UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-3855
Fidelity Advisor Series VIII
(Exact name of registrant as specified in charter)
82 Devonshire St., Boston, Massachusetts 02109
(Address of principal executive offices) (Zip code)
Scott C. Goebel, Secretary
82 Devonshire St.
Boston, Massachusetts 02109
(Name and address of agent for service)
Registrant's telephone number, including area code: 617-563-7000
Date of fiscal year end: | December 31 |
| |
Date of reporting period: | June 30, 2010 |
Item 1. Reports to Stockholders
(Fidelity Investment logo)(registered trademark)
Fidelity® Advisor
Emerging Markets Income
Fund - Class A, Class T, Class B
and Class C
Semiannual Report
June 30, 2010
(2_fidelity_logos) (Registered_Trademark)
Contents
Chairman's Message | <Click Here> | The Chairman's message to shareholders. |
Shareholder Expense Example | <Click Here> | An example of shareholder expenses. |
Investment Changes | <Click Here> | A summary of major shifts in the fund's investments over the past six months. |
Investments | <Click Here> | A complete list of the fund's investments with their market values. |
Financial Statements | <Click Here> | Statements of assets and liabilities, operations, and changes in net assets, as well as financial highlights. |
Notes | <Click Here> | Notes to the financial statements. |
To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://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 LLC 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 holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com or http://www.advisor.fidelity.com, as applicable.
NOT FDIC INSURED • MAY LOSE VALUE • NO BANK GUARANTEE
Neither the fund nor Fidelity Distributors Corporation is a bank.
Semiannual Report
(photo_of_Edward_C_Johnson_3d)
Dear Shareholder:
A yearlong uptrend in global equity markets came under significant pressure in May 2010 when investor sentiment turned bearish amid growing concern that Europe's debt crisis would expand and slow or derail economic recovery. Financial markets are always unpredictable, of course, but there also are several time-tested investment principles that can help put the 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 can be tax advantages and cost benefits to consider as well. 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 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 "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 by phone. It is our privilege to provide you the information you need to make the investments that are right for you.
Sincerely,
(The chairman's signature appears here.)
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, redemption fees, 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, 2010 to June 30, 2010).
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. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
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. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
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.
Semiannual Report
Shareholder Expense Example - continued
|
Annualized
Expense Ratio
|
Beginning
Account Value
January 1, 2010
|
Ending
Account Value
June 30, 2010
| Expenses Paid
During Period*
January 1, 2010 to
June 30, 2010 |
Class A | 1.20% | | | |
Actual | | $ 1,000.00 | $ 1,040.90 | $ 6.07 |
Hypothetical A | | $ 1,000.00 | $ 1,018.84 | $ 6.01 |
Class T | 1.20% | | | |
Actual | | $ 1,000.00 | $ 1,041.80 | $ 6.08 |
Hypothetical A | | $ 1,000.00 | $ 1,018.84 | $ 6.01 |
Class B | 1.85% | | | |
Actual | | $ 1,000.00 | $ 1,037.90 | $ 9.35 |
Hypothetical A | | $ 1,000.00 | $ 1,015.62 | $ 9.25 |
Class C | 1.95% | | | |
Actual | | $ 1,000.00 | $ 1,037.60 | $ 9.85 |
Hypothetical A | | $ 1,000.00 | $ 1,015.12 | $ 9.74 |
Institutional Class | .94% | | | |
Actual | | $ 1,000.00 | $ 1,042.90 | $ 4.76 |
Hypothetical A | | $ 1,000.00 | $ 1,020.13 | $ 4.71 |
A 5% return per year before expenses
* Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).
Semiannual Report
Investment Changes (Unaudited)
Top Five Countries as of June 30, 2010 |
(excluding cash equivalents) | % of fund's
net assets | % of fund's net assets
6 months ago |
United States of America | 9.1 | 6.0 |
Brazil | 7.2 | 8.3 |
Russia | 6.9 | 8.0 |
Turkey | 6.8 | 4.6 |
Indonesia | 5.9 | 6.8 |
Percentages are adjusted for the effect of open futures contracts, if applicable. |
Top Five Holdings as of June 30, 2010 |
(by issuer, excluding cash equivalents) | % of fund's
net assets | % of fund's net assets
6 months ago |
Turkish Republic | 6.8 | 4.6 |
Russian Federation | 6.7 | 8.0 |
Brazilian Federative Republic | 5.1 | 6.6 |
Indonesian Republic | 5.0 | 6.0 |
U.S. Treasury Obligations | 4.5 | 1.8 |
| 28.1 | |
Asset Allocation (% of fund's net assets) |
As of June 30, 2010 | As of December 31, 2009 |
 | Corporate Bonds 22.7% | | | Corporate Bonds 19.0% | |
 | Government
Obligations 64.6% | | | Government
Obligations 66.1% | |
 | Supranational Obligations 0.6% | | | Supranational Obligations 0.8% | |
 | Stocks and Investment
Companies 1.3% | | | Stocks and Investment
Companies 2.9% | |
 | Preferred Securities 0.9% | | | Preferred Securities 0.7% | |
 | Short-Term
Investments and
Net Other Assets 9.9% | | | Short-Term
Investments and
Net Other Assets 10.5% | |
Semiannual Report
Investments June 30, 2010 (Unaudited)
Showing Percentage of Net Assets
Nonconvertible Bonds - 22.7% |
| Principal Amount (b) | | Value |
Argentina - 0.6% |
City of Buenos Aires 12.5% 4/6/15 (d) | | $ 1,920,000 | | $ 1,939,200 |
Pan American Energy LLC 7.875% 5/7/21 (d) | | 2,415,000 | | 2,390,850 |
TOTAL ARGENTINA | | 4,330,050 |
Australia - 0.0% |
Leighton Finance International 7.875% 5/16/11 | | 250,000 | | 251,875 |
Bahamas (Nassau) - 0.2% |
Odebrecht Overseas Ltd. 9.625% | | 1,615,000 | | 1,615,000 |
Bermuda - 0.2% |
Noble Group Ltd.: | | | | |
6.75% 1/29/20 (d) | | 930,000 | | 892,800 |
8.5% 5/30/13 (Reg. S) | | 250,000 | | 273,750 |
TOTAL BERMUDA | | 1,166,550 |
Brazil - 1.9% |
Banco Cruzeiro Do Sul SA 8.5% 2/20/15 (d) | | 1,550,000 | | 1,588,750 |
Banco do Brasil SA 4.5% 1/22/15 (d) | | 1,475,000 | | 1,489,750 |
Banco Nacional de Desenvolvimento Economico e Social 5.5% 7/12/20 (d) | | 3,260,000 | | 3,260,000 |
Banco Votorantim SA 7.375% 1/21/20 (d) | | 1,110,000 | | 1,137,750 |
BFF International Ltd. 7.25% 1/28/20 (d) | | 1,445,000 | | 1,483,004 |
Braskem Finance Ltd. 7% 5/7/20 (d) | | 1,830,000 | | 1,848,300 |
Centrais Eletricas Brasileiras SA (Electrobras) 6.875% 7/30/19 (d) | | 820,000 | | 889,700 |
Net Servicos de Comunicacao SA 7.5% 1/27/20 (d) | | 1,850,000 | | 1,928,625 |
Rearden G Holdings Eins GmbH 7.875% 3/30/20 (d) | | 970,000 | | 977,275 |
TOTAL BRAZIL | | 14,603,154 |
British Virgin Islands - 0.0% |
Road King Infrastructure Finance 2004 Ltd. 6.25% 7/15/11 | | 235,000 | | 234,413 |
Cayman Islands - 2.3% |
Banco Bradesco SA 4.1% 3/23/15 (d) | | 1,990,000 | | 1,980,050 |
Country Garden Holdings Co. Ltd. 11.25% 4/22/17 (d) | | 845,000 | | 790,075 |
CSN Islands XI Corp. 6.875% 9/21/19 (d) | | 1,910,000 | | 1,942,470 |
Hutchison Whampoa International 09 Ltd. 7.625% 4/9/19 (Reg. S) | | 1,035,000 | | 1,234,599 |
Lumena Resources Corp. 12% 10/27/14 (d) | | 265,000 | | 225,250 |
Odebrecht Finance Ltd.: | | | | |
7% 4/21/20 (d) | | 1,480,000 | | 1,502,200 |
9.625% 4/9/14 (d) | | 1,430,000 | | 1,673,100 |
Petrobras International Finance Co. Ltd. 5.75% 1/20/20 | | 1,795,000 | | 1,807,651 |
Pontis Ltd. 6.25% 7/20/10 (d) | | 3,260,000 | | 3,211,100 |
Nonconvertible Bonds - continued |
| Principal Amount (b) | | Value |
Cayman Islands - continued |
TDIC Finance Ltd. 6.5% 7/2/14 (d) | | $ 2,320,000 | | $ 2,467,900 |
Voto-Votorantim Overseas Trading Operations V Ltd. 6.625% 9/25/19 (d) | | 1,540,000 | | 1,559,250 |
TOTAL CAYMAN ISLANDS | | 18,393,645 |
Colombia - 0.2% |
Empresas Publicas de Medellin 7.625% 7/29/19 (d) | | 1,390,000 | | 1,560,275 |
Egypt - 0.2% |
African Export-Import Bank 8.75% 11/13/14 | | 1,740,000 | | 1,844,400 |
Indonesia - 0.4% |
Adaro Indonesia PT 7.625% 10/22/19 (d) | | 2,210,000 | | 2,243,150 |
APP International Finance (Mauritius) Ltd.: | | | | |
0% 7/5/01 (a)(d) | | 1,235,000 | | 0 |
0% 7/5/01 (Reg. S) (a) | | 445,000 | | 0 |
BLT Finance BV 7.5% 5/15/14 (Reg. S) | | 245,000 | | 163,856 |
Listrindo Capital BV 9.25% 1/29/15 (d) | | 740,000 | | 777,000 |
TOTAL INDONESIA | | 3,184,006 |
Ireland - 0.4% |
Vimpel Communications: | | | | |
8.375% 4/30/13 (Issued by VIP Finance Ireland Ltd. for Vimpel Communications) (d) | | 1,455,000 | | 1,535,025 |
9.125% 4/30/18 (Issued by VIP Finance Ireland Ltd. for Vimpel Communications) (d) | | 1,455,000 | | 1,567,763 |
TOTAL IRELAND | | 3,102,788 |
Isle of Man - 0.2% |
AngloGold Ashanti Holdings PLC 5.375% 4/15/20 | | 1,885,000 | | 1,880,495 |
Korea (South) - 1.9% |
Export-Import Bank of Korea: | | | | |
5.125% 6/29/20 | | 1,660,000 | | 1,664,482 |
8.125% 1/21/14 | | 1,360,000 | | 1,548,224 |
Hyundai Capital Services, Inc. 6% 5/5/15 (d) | | 1,960,000 | | 2,058,000 |
Industrial Bank of Korea 7.125% 4/23/14 (d) | | 1,620,000 | | 1,808,568 |
Korea Development Bank 4.375% 8/10/15 | | 1,930,000 | | 1,971,688 |
Korea Expressway Corp. 4.5% 3/23/15 (d) | | 1,940,000 | | 1,980,934 |
POSCO 8.75% 3/26/14 (d) | | 1,590,000 | | 1,878,585 |
SK Broadband Co., Ltd. 7% 2/1/12 (d) | | 1,490,000 | | 1,545,875 |
Woori Bank 7% 2/2/15 (d) | | 690,000 | | 753,342 |
TOTAL KOREA (SOUTH) | | 15,209,698 |
Nonconvertible Bonds - continued |
| Principal Amount (b) | | Value |
Luxembourg - 1.9% |
ArcelorMittal SA 9% 2/15/15 | | $ 1,080,000 | | $ 1,270,574 |
Millicom International Cellular SA 10% 12/1/13 | | 1,800,000 | | 1,854,000 |
OJSC Russian Agricultural Bank: | | | | |
6.299% 5/15/17 (Issued by RSHB Capital SA for OJSC Russian Agricultural Bank) (d) | | 1,665,000 | | 1,652,513 |
6.97% 9/21/16 (Issued by RSHB Capital SA for OJSC Russian Agricultural Bank) (e) | | 565,000 | | 557,938 |
7.125% 1/14/14 (Issued by RSHB Capital SA for OJSC Russian Agricultural Bank) (d) | | 1,355,000 | | 1,432,913 |
7.175% 5/16/13 (Issued by RSHB Capital SA for OJSC Russian Agricultural Bank) (d) | | 1,040,000 | | 1,094,600 |
7.75% 5/29/18 (Issued by RSHB Capital SA for OJSC Russian Agricultural Bank) (d) | | 1,265,000 | | 1,353,550 |
RSHB Capital SA 9% 6/11/14 (d) | | 1,215,000 | | 1,363,838 |
TNK-BP Finance SA: | | | | |
7.5% 3/13/13 (d) | | 1,070,000 | | 1,128,850 |
7.875% 3/13/18 (Reg. S) | | 1,450,000 | | 1,511,625 |
VTB Capital SA 6.465% 3/4/15 (d) | | 1,860,000 | | 1,860,000 |
TOTAL LUXEMBOURG | | 15,080,401 |
Mexico - 0.7% |
Alestra SA de RL de CV 11.75% 8/11/14 | | 1,320,000 | | 1,405,800 |
America Movil SAB de CV 3.625% 3/30/15 (d) | | 1,479,000 | | 1,517,155 |
Petroleos Mexicanos 6% 3/5/20 (d) | | 2,105,000 | | 2,199,725 |
Vitro SAB de CV 9.125% 2/1/17 (a) | | 675,000 | | 310,500 |
TOTAL MEXICO | | 5,433,180 |
Netherlands - 4.6% |
Bulgaria Steel Finance BV 12% 5/4/13 unit (a) | EUR | 600,000 | | 73,368 |
DTEK Finance BV 9.5% 4/28/15 (d) | | 1,560,000 | | 1,474,200 |
Indosat Finance Co. BV 7.75% 11/5/10 | | 625,000 | | 631,250 |
Intergas Finance BV: | | | | |
6.375% 5/14/17 (Reg. S) | | 2,080,000 | | 2,080,000 |
6.875% 11/4/11 (Reg. S) | | 954,000 | | 982,620 |
Kazakhstan Temir Zholy Finance BV 6.5% 5/11/11 | | 1,110,000 | | 1,118,325 |
KazMunaiGaz Finance Sub BV: | | | | |
7% 5/5/20 (d) | | 3,170,000 | | 3,173,170 |
8.375% 7/2/13 (d) | | 2,660,000 | | 2,859,500 |
9.125% 7/2/18 (d) | | 3,700,000 | | 4,250,375 |
11.75% 1/23/15 (d) | | 3,750,000 | | 4,584,375 |
Lippo Karawaci Finance BV 8.875% 3/9/11 | | 260,000 | | 264,888 |
Nonconvertible Bonds - continued |
| Principal Amount (b) | | Value |
Netherlands - continued |
Majapahit Holding BV: | | | | |
7.25% 6/28/17 (Reg. S) | | $ 1,105,000 | | $ 1,179,588 |
7.75% 10/17/16 (Reg. S) | | 1,720,000 | | 1,896,300 |
7.75% 1/20/20 (d) | | 3,340,000 | | 3,657,300 |
7.875% 6/29/37 (Reg. S) | | 3,065,000 | | 3,110,975 |
8% 8/7/19 (d) | | 1,700,000 | | 1,878,500 |
Matahari International Finance Co. BV 10.75% 8/7/12 | | 1,690,000 | | 1,768,247 |
Paiton Energy Funding BV 9.34% 2/15/14 (Reg. S) | | 247,000 | | 251,940 |
PT Indosat International Finance Co. BV 7.125% 6/22/12 (d) | | 1,090,000 | | 1,122,700 |
TOTAL NETHERLANDS | | 36,357,621 |
Peru - 0.1% |
CFG Investment SAC 9.25% 12/19/13 (Reg. S) | | 705,000 | | 712,050 |
Philippines - 1.5% |
National Power Corp. 6.875% 11/2/16 (d) | | 2,885,000 | | 3,173,500 |
Power Sector Assets and Liabilities Management Corp.: | | | | |
7.25% 5/27/19 (d) | | 3,700,000 | | 4,084,060 |
7.39% 12/2/24 (d) | | 4,260,000 | | 4,659,375 |
TOTAL PHILIPPINES | | 11,916,935 |
Qatar - 0.2% |
Qtel International Finance Ltd. 6.5% 6/10/14 (d) | | 1,310,000 | | 1,434,450 |
Russia - 0.2% |
MTS International Funding Ltd. 8.625% 6/22/20 (d) | | 1,555,000 | | 1,606,471 |
Trinidad & Tobago - 0.3% |
Petroleum Co. of Trinidad & Tobago Ltd. 9.75% 8/14/19 (d) | | 2,045,000 | | 2,336,413 |
Ukraine - 0.4% |
Naftogaz of Ukraine NJSC 9.5% 9/30/14 | | 2,770,000 | | 2,873,875 |
United Arab Emirates - 0.6% |
Dolphin Energy Ltd. 5.888% 6/15/19 (d) | | 2,906,679 | | 3,008,413 |
Dubai Electricity & Water Authority 8.5% 4/22/15 (d) | | 1,850,000 | | 1,882,375 |
TOTAL UNITED ARAB EMIRATES | | 4,890,788 |
United Kingdom - 0.6% |
EXIM of Ukraine 7.65% 9/7/11 (Issued by Credit Suisse International for EXIM of Ukraine) | | 4,345,000 | | 4,279,825 |
United States of America - 2.6% |
Drummond Co., Inc. 9% 10/15/14 (d) | | 3,062,000 | | 3,107,930 |
Gerdau Holdings, Inc. 7% 1/20/20 (d) | | 1,365,000 | | 1,386,840 |
Nonconvertible Bonds - continued |
| Principal Amount (b) | | Value |
United States of America - continued |
NII Capital Corp.: | | | | |
8.875% 12/15/19 | | $ 1,875,000 | | $ 1,921,875 |
10% 8/15/16 | | 2,100,000 | | 2,210,250 |
Pemex Project Funding Master Trust 8.625% 2/1/22 | | 5,800,000 | | 7,163,000 |
Southern Copper Corp.: | | | | |
5.375% 4/16/20 | | 845,000 | | 847,113 |
6.75% 4/16/40 | | 3,975,000 | | 3,955,125 |
TOTAL UNITED STATES OF AMERICA | | 20,592,133 |
Venezuela - 0.5% |
Petroleos de Venezuela SA: | | | | |
5.25% 4/12/17 | | 3,585,000 | | 1,917,975 |
5.375% 4/12/27 | | 3,535,000 | | 1,573,075 |
TOTAL VENEZUELA | | 3,491,050 |
TOTAL NONCONVERTIBLE BONDS (Cost $174,028,660) | 178,381,541 |
Government Obligations - 64.6% |
|
Argentina - 2.8% |
Argentine Republic: | | | | |
discount (with partial capitalization through 12/31/13) 8.28% 12/31/33 | | 8,300,635 | | 5,582,177 |
par 2.5% 12/31/38 (c) | | 10,520,000 | | 3,734,600 |
0% 12/15/35 | | 7,523,560 | | 583,076 |
7% 9/12/13 | | 10,790,000 | | 9,390,897 |
discount (with partial capitalization through 12/31/13) 8.28% 12/31/33 | | 3,257,600 | | 2,174,448 |
8.75% 6/2/17 | | 703,801 | | 594,712 |
TOTAL ARGENTINA | | 22,059,910 |
Bahamas (Nassau) - 0.5% |
Bahamian Republic 6.95% 11/20/29 (d) | | 3,740,000 | | 3,740,000 |
Barbados - 0.4% |
Barbados Government 7.25% 12/15/21 (d) | | 2,635,000 | | 2,793,100 |
Belize - 0.2% |
Belize Government 6% 2/20/29 (c)(d) | | 2,354,700 | | 1,730,705 |
Brazil - 5.1% |
Brazilian Federative Republic: | | | | |
5.625% 1/7/41 | | 5,945,000 | | 5,855,825 |
Government Obligations - continued |
| Principal Amount (b) | | Value |
Brazil - continued |
Brazilian Federative Republic: - continued | | | | |
5.875% 1/15/19 | | $ 4,665,000 | | $ 5,131,500 |
7.125% 1/20/37 | | 3,070,000 | | 3,647,160 |
8% 1/15/18 | | 1,693,333 | | 1,972,733 |
8.25% 1/20/34 | | 2,040,000 | | 2,692,800 |
8.875% 4/15/24 | | 2,290,000 | | 3,102,950 |
10.125% 5/15/27 | | 2,990,000 | | 4,485,000 |
11% 8/17/40 | | 4,600,000 | | 6,175,500 |
12.25% 3/6/30 | | 2,015,000 | | 3,526,250 |
12.5% 1/5/16 | BRL | 4,105,000 | | 2,523,356 |
12.75% 1/15/20 | | 850,000 | | 1,377,000 |
TOTAL BRAZIL | | 40,490,074 |
Cayman Islands - 0.5% |
Cayman Island Government 5.95% 11/24/19 (d) | | 3,880,000 | | 3,880,000 |
Colombia - 2.2% |
Colombian Republic: | | | | |
6.125% 1/18/41 | | 4,635,000 | | 4,681,350 |
7.375% 3/18/19 | | 2,005,000 | | 2,345,850 |
10.375% 1/28/33 | | 3,790,000 | | 5,495,500 |
11.75% 2/25/20 | | 3,393,000 | | 5,030,123 |
TOTAL COLOMBIA | | 17,552,823 |
Congo - 0.6% |
Congo Republic 3% 6/30/29 (c) | | 8,298,250 | | 4,398,073 |
Croatia - 0.6% |
Croatia Republic 6.75% 11/5/19 (d) | | 4,890,000 | | 5,071,908 |
Dominican Republic - 0.9% |
Dominican Republic: | | | | |
7.5% 5/6/21 (d) | | 3,240,000 | | 3,337,200 |
9.04% 1/23/18 (d) | | 3,202,422 | | 3,554,689 |
TOTAL DOMINICAN REPUBLIC | | 6,891,889 |
Ecuador - 0.4% |
Ecuador Republic 9.375% 12/15/15 (d) | | 3,940,000 | | 3,467,200 |
Egypt - 0.3% |
Arab Republic of Egypt 5.75% 4/29/20 (d) | | 2,690,000 | | 2,703,450 |
El Salvador - 1.0% |
El Salvador Republic: | | | | |
7.375% 12/1/19 (d) | | 2,705,000 | | 2,948,450 |
7.65% 6/15/35 (Reg. S) | | 2,975,000 | | 3,153,500 |
Government Obligations - continued |
| Principal Amount (b) | | Value |
El Salvador - continued |
El Salvador Republic: - continued | | | | |
7.75% 1/24/23 (Reg. S) | | $ 1,050,000 | | $ 1,149,750 |
8.25% 4/10/32 (Reg. S) | | 865,000 | | 951,500 |
TOTAL EL SALVADOR | | 8,203,200 |
Gabon - 0.9% |
Gabonese Republic 8.2% 12/12/17 (d) | | 6,590,000 | | 6,993,638 |
Georgia - 0.8% |
Georgia Republic 7.5% 4/15/13 | | 5,875,000 | | 6,080,625 |
Ghana - 1.0% |
Ghana Republic: | | | | |
8.5% 10/4/17 (d) | | 6,555,000 | | 6,882,750 |
14.99% 3/11/13 | GHS | 1,380,000 | | 945,575 |
TOTAL GHANA | | 7,828,325 |
Hungary - 0.3% |
Hungarian Republic 6.25% 1/29/20 | | 1,990,000 | | 1,950,200 |
Indonesia - 5.5% |
Indonesian Republic: | | | | |
5.875% 3/13/20 (d) | | 2,610,000 | | 2,750,418 |
6.625% 2/17/37 (d) | | 3,145,000 | | 3,302,250 |
6.75% 3/10/14 (Reg. S) | | 1,940,000 | | 2,138,850 |
6.875% 3/9/17 (d) | | 1,990,000 | | 2,243,725 |
6.875% 1/17/18 (d) | | 3,825,000 | | 4,312,688 |
7.25% 4/20/15 (d) | | 1,615,000 | | 1,841,100 |
7.5% 1/15/16 (d) | | 5,310,000 | | 6,159,600 |
7.75% 1/17/38 (d) | | 3,485,000 | | 4,112,300 |
8.5% 10/12/35 (d) | | 4,440,000 | | 5,594,400 |
10.375% 5/4/14 (d) | | 1,715,000 | | 2,105,163 |
11.625% 3/4/19 (d) | | 3,685,000 | | 5,287,975 |
Perusahaan Penerbit SBSN Indonesia 8.8% 4/23/14 (d) | | 3,070,000 | | 3,568,875 |
TOTAL INDONESIA | | 43,417,344 |
Iraq - 0.8% |
Republic of Iraq 5.8% 1/15/28 (Reg. S) | | 7,270,000 | | 5,888,700 |
Ivory Coast - 1.4% |
Ivory Coast 2.45% 12/31/32 (c) | | 19,815,000 | | 10,700,100 |
Jamaica - 0.1% |
Jamaican Government 8% 3/15/39 | | 1,228,000 | | 1,105,200 |
Government Obligations - continued |
| Principal Amount (b) | | Value |
Lebanon - 1.6% |
Lebanese Republic: | | | | |
4% 12/31/17 | | $ 6,067,500 | | $ 5,803,564 |
9% 3/20/17 | | 2,365,000 | | 2,778,875 |
11.625% 5/11/16 (Reg. S) | | 3,290,000 | | 4,227,650 |
TOTAL LEBANON | | 12,810,089 |
Lithuania - 0.9% |
Lithuanian Republic: | | | | |
6.75% 1/15/15 (d) | | 3,515,000 | | 3,676,690 |
7.375% 2/11/20 (d) | | 3,545,000 | | 3,718,705 |
TOTAL LITHUANIA | | 7,395,395 |
Mexico - 3.6% |
United Mexican States: | | | | |
5.125% 1/15/20 | | 1,516,000 | | 1,588,010 |
5.625% 1/15/17 | | 9,317,000 | | 10,248,700 |
6.05% 1/11/40 | | 6,594,000 | | 6,956,670 |
11.375% 9/15/16 | | 1,939,000 | | 2,733,990 |
11.5% 5/15/26 | | 3,945,000 | | 6,726,225 |
TOTAL MEXICO | | 28,253,595 |
Pakistan - 1.2% |
Islamic Republic of Pakistan: | | | | |
6.875% 6/1/17 (d) | | 7,665,000 | | 6,975,150 |
7.125% 3/31/16 (d) | | 2,320,000 | | 2,157,600 |
TOTAL PAKISTAN | | 9,132,750 |
Panama - 0.5% |
Panamanian Republic 5.2% 1/30/20 | | 3,740,000 | | 3,880,250 |
Peru - 0.9% |
Peruvian Republic: | | | | |
7.35% 7/21/25 | | 2,725,000 | | 3,265,913 |
8.75% 11/21/33 | | 2,940,000 | | 3,983,700 |
TOTAL PERU | | 7,249,613 |
Philippines - 3.2% |
Philippine Republic: | | | | |
6.375% 10/23/34 | | 7,350,000 | | 7,369,110 |
6.5% 1/20/20 | | 6,065,000 | | 6,672,107 |
7.75% 1/14/31 | | 3,395,000 | | 3,934,126 |
Government Obligations - continued |
| Principal Amount (b) | | Value |
Philippines - continued |
Philippine Republic: - continued | | | | |
9.5% 2/2/30 | | $ 3,300,000 | | $ 4,463,250 |
10.625% 3/16/25 | | 1,765,000 | | 2,546,013 |
TOTAL PHILIPPINES | | 24,984,606 |
Poland - 0.6% |
Polish Government 6.375% 7/15/19 | | 4,510,000 | | 4,915,900 |
Qatar - 0.8% |
State of Qatar: | | | | |
4% 1/20/15 (d) | | 3,555,000 | | 3,652,514 |
6.4% 1/20/40 (d) | | 2,095,000 | | 2,225,665 |
TOTAL QATAR | | 5,878,179 |
Russia - 6.7% |
Russian Federation: | | | | |
3.625% 4/29/15 (d) | | 8,700,000 | | 8,428,560 |
7.5% 3/31/30 (Reg. S) | | 31,960,800 | | 36,075,735 |
12.75% 6/24/28 (Reg. S) | | 4,974,000 | | 8,331,450 |
TOTAL RUSSIA | | 52,835,745 |
Serbia - 0.6% |
Republic of Serbia 6.75% 11/1/24 (d) | | 5,147,500 | | 4,928,731 |
South Africa - 0.2% |
South African Republic 5.5% 3/9/20 | | 1,810,000 | | 1,871,088 |
Sri Lanka - 0.7% |
Democratic Socialist Republic of Sri Lanka: | | | | |
7.4% 1/22/15 (d) | | 3,195,000 | | 3,282,863 |
8.25% 10/24/12 (d) | | 1,850,000 | | 1,970,250 |
TOTAL SRI LANKA | | 5,253,113 |
Turkey - 6.8% |
Turkish Republic: | | | | |
0% 11/16/11 | TRY | 6,930,000 | | 3,895,978 |
5.625% 3/30/21 | | 3,295,000 | | 3,253,813 |
6.75% 4/3/18 | | 1,615,000 | | 1,768,425 |
6.75% 5/30/40 | | 5,100,000 | | 5,115,300 |
6.875% 3/17/36 | | 6,700,000 | | 6,917,750 |
7% 9/26/16 | | 1,225,000 | | 1,364,405 |
7% 3/11/19 | | 4,045,000 | | 4,479,838 |
7% 6/5/20 | | 1,565,000 | | 1,727,447 |
7.25% 3/15/15 | | 1,195,000 | | 1,335,413 |
Government Obligations - continued |
| Principal Amount (b) | | Value |
Turkey - continued |
Turkish Republic: - continued | | | | |
7.25% 3/5/38 | | $ 1,815,000 | | $ 1,946,588 |
7.375% 2/5/25 | | 4,620,000 | | 5,191,956 |
7.5% 7/14/17 | | 1,735,000 | | 1,977,900 |
7.5% 11/7/19 | | 1,460,000 | | 1,673,598 |
9.5% 1/15/14 | | 2,675,000 | | 3,143,125 |
11% 1/14/13 | | 2,325,000 | | 2,726,063 |
11.875% 1/15/30 | | 4,305,000 | | 6,958,172 |
TOTAL TURKEY | | 53,475,771 |
Ukraine - 0.9% |
Ukraine Cabinet of Ministers: | | | | |
6.58% 11/21/16 (d) | | 2,095,000 | | 1,943,113 |
6.875% 3/4/11 (Reg. S) | | 1,445,000 | | 1,445,000 |
Ukraine Government: | | | | |
6.385% 6/26/12 (d) | | 845,000 | | 836,550 |
6.75% 11/14/17 (d) | | 1,830,000 | | 1,697,325 |
7.65% 6/11/13 (Reg. S) | | 1,400,000 | | 1,417,500 |
TOTAL UKRAINE | | 7,339,488 |
United States of America - 4.5% |
U.S. Treasury Bonds 4.375% 5/15/40 | | 32,630,000 | | 35,378,099 |
Uruguay - 0.4% |
Uruguay Republic 8% 11/18/22 | | 2,420,000 | | 2,916,100 |
Venezuela - 3.5% |
Venezuelan Republic: | | | | |
oil recovery rights 4/15/20 (g) | | 15,490 | | 387,250 |
1.3072% 4/20/11 (Reg. S) (e) | | 8,360,000 | | 7,733,000 |
5.375% 8/7/10 (Reg. S) | | 1,535,000 | | 1,523,488 |
5.75% 2/26/16 (Reg S.) | | 3,010,000 | | 1,896,300 |
7% 3/31/38 | | 1,345,000 | | 706,125 |
7.75% 10/13/19 (Reg. S) | | 5,005,000 | | 3,003,000 |
8.5% 10/8/14 | | 2,495,000 | | 1,946,100 |
9.25% 9/15/27 | | 3,960,000 | | 2,722,500 |
9.25% 5/7/28 (Reg. S) | | 2,025,000 | | 1,235,250 |
9.375% 1/13/34 | | 2,080,000 | | 1,300,000 |
10.75% 9/19/13 | | 4,445,000 | | 3,911,600 |
13.625% 8/15/18 | | 1,255,000 | | 1,098,125 |
TOTAL VENEZUELA | | 27,462,738 |
Government Obligations - continued |
| Principal Amount (b) | | Value |
Vietnam - 0.7% |
Vietnamese Socialist Republic: | | | | |
6.75% 1/29/20 (d) | | $ 3,720,000 | | $ 3,831,600 |
6.875% 1/15/16 (d) | | 1,445,000 | | 1,535,313 |
TOTAL VIETNAM | | 5,366,913 |
TOTAL GOVERNMENT OBLIGATIONS (Cost $483,932,563) | 508,274,627 |
Supranational Obligations - 0.6% |
|
Central American Bank 5.375% 9/24/14 (d) | | 1,770,000 | | 1,871,775 |
Corporacion Andina de Fomento 8.125% 6/4/19 | | 1,610,000 | | 1,974,021 |
Eurasian Development Bank 7.375% 9/29/14 (d) | | 980,000 | | 1,016,750 |
TOTAL SUPRANATIONAL OBLIGATIONS (Cost $4,462,196) | 4,862,546 |
Investment Companies - 1.3% |
| Shares | | |
United States of America - 1.3% |
iShares MSCI Brazil Index ETF
(Cost $10,661,583) | 164,800 | | 10,211,008 |
Preferred Securities - 0.9% |
| Principal Amount (b) | | |
Brazil - 0.2% |
Globo Comunicacoes e Participacoes SA 9.375% | $ 1,805,000 | | 1,838,007 |
United States of America - 0.7% |
Pemex Project Funding Master Trust 7.75% | 5,060,000 | | 5,082,371 |
TOTAL PREFERRED SECURITIES (Cost $6,926,026) | 6,920,378 |
Money Market Funds - 8.0% |
| Shares | | Value |
Fidelity Cash Central Fund, 0.20% (f)
(Cost $63,026,038) | 63,026,038 | | $ 63,026,038 |
TOTAL INVESTMENT PORTFOLIO - 98.1% (Cost $743,037,066) | | 771,676,138 |
NET OTHER ASSETS (LIABILITIES) - 1.9% | | 15,189,083 |
NET ASSETS - 100% | $ 786,865,221 |
Security Type Abbreviations |
ETF | - | Exchange-Traded Fund |
Currency Abbreviations |
BRL | - | Brazilian real |
EUR | - | European Monetary Unit |
GHS | - | Ghana cedi |
TRY | - | New Turkish Lira |
Legend |
(a) Non-income producing - Issuer is in default. |
(b) Principal amount is stated in United States dollars unless otherwise noted. |
(c) Security initially issued at one coupon which converts to a higher coupon at a specified date. The rate shown is the rate at period end. |
(d) 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 end of the period, the value of these securities amounted to $258,299,745 or 32.8% of net assets. |
(e) The coupon rate shown on floating or adjustable rate securities represents the rate at period end. |
(f) 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. |
(g) Quantity represents share amount. |
Affiliated Central Funds |
Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows: |
Fund | Income earned |
Fidelity Cash Central Fund | $ 39,709 |
Fidelity Securities Lending Cash Central Fund | 7 |
Total | $ 39,716 |
Other Information |
The following is a summary of the inputs used, as of June 30, 2010, involving the Fund's assets and liabilities carried at value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the tables below, please refer to the Security Valuation section in the accompanying Notes to Financial Statements. |
Valuation Inputs at Reporting Date: |
Description | Total | Level 1 | Level 2 | Level 3 |
Investments in Securities: | | | | |
Corporate Bonds | $ 178,381,541 | $ - | $ 178,308,173 | $ 73,368 |
Government Obligations | 508,274,627 | - | 508,274,627 | - |
Supranational Obligations | 4,862,546 | - | 4,862,546 | - |
Investment Companies | 10,211,008 | 10,211,008 | - | - |
Preferred Securities | 6,920,378 | - | 6,920,378 | - |
Money Market Funds | 63,026,038 | 63,026,038 | - | - |
Total Investments in Securities: | $ 771,676,138 | $ 73,237,046 | $ 698,365,724 | $ 73,368 |
The following is a reconciliation of Investments in Securities for which Level 3 inputs were used in determining value: |
Investments in Securities: | |
Beginning Balance | $ 563,258 |
Total Realized Gain (Loss) | - |
Total Unrealized Gain (Loss) | 56,188 |
Cost of Purchases | - |
Proceeds of Sales | - |
Amortization/Accretion | - |
Transfers in to Level 3 | 17,180 |
Transfers out of Level 3 | (563,258) |
Ending Balance | $ 73,368 |
The change in unrealized gain (loss) for the period attributable to Level 3 securities held at June 30, 2010 | $ 56,188 |
The information used in the above reconciliation represents fiscal year to date activity for any Investments in Securities identified as using Level 3 inputs at either the beginning or the end of the current fiscal period. Transfers in or out of Level 3 represent the beginning value of any Security or Instrument where a change in the pricing level occurred from the beginning to the end of the period. The cost of purchases and the proceeds of sales may include securities received or delivered through corporate actions or exchanges. Realized and unrealized gains (losses) disclosed in the reconciliation are included in Net Gain (Loss) on the Fund's Statement of Operations. |
Other Information - continued |
The composition of credit quality ratings as a percentage of net assets is as follows (ratings are unaudited): |
U.S. Government and U.S. Government Agency Obligations | 4.5% |
AAA,AA,A | 5.9% |
BBB | 27.9% |
BB | 29.2% |
B | 16.0% |
CCC,CC,C | 0.4% |
Not Rated | 4.8% |
Equities | 1.4% |
Short-Term Investments
and Net Other Assets | 9.9% |
| 100.0% |
We have used ratings from Moody's Investors Service, Inc. Where Moody's ratings are not available, we have used S&P ratings. All ratings are as of the report date and do not reflect subsequent downgrades. |
Income Tax Information |
At December 31, 2009, the Fund had a capital loss carryforward of approximately $3,380,295 all of which will expire on December 31, 2016. Capital loss carryforwards are only available to offset future capital gains of the Fund to the extent provided by regulations and may be limited. |
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Statement of Assets and Liabilities
| June 30, 2010 (Unaudited) |
| | |
Assets | | |
Investment in securities, at value - See accompanying schedule: Unaffiliated issuers (cost $680,011,028) | $ 708,650,100 | |
Fidelity Central Funds (cost $63,026,038) | 63,026,038 | |
Total Investments (cost $743,037,066) | | $ 771,676,138 |
Cash | | 818,469 |
Receivable for investments sold | | 5,215,395 |
Receivable for fund shares sold | | 3,665,272 |
Dividends receivable | | 120,000 |
Interest receivable | | 13,442,523 |
Distributions receivable from Fidelity Central Funds | | 11,811 |
Receivable from investment adviser for expense reductions | | 24,262 |
Other receivables | | 327 |
Total assets | | 794,974,197 |
| | |
Liabilities | | |
Payable for investments purchased | $ 5,363,305 | |
Payable for fund shares redeemed | 1,000,359 | |
Distributions payable | 944,374 | |
Accrued management fee | 422,461 | |
Distribution fees payable | 154,546 | |
Other affiliated payables | 149,188 | |
Other payables and accrued expenses | 74,743 | |
Total liabilities | | 8,108,976 |
| | |
Net Assets | | $ 786,865,221 |
Net Assets consist of: | | |
Paid in capital | | $ 761,405,179 |
Undistributed net investment income | | 5,114,398 |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | | (8,295,959) |
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies | | 28,641,603 |
Net Assets | | $ 786,865,221 |
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Statements - continued
Statement of Assets and Liabilities - continued
| June 30, 2010 (Unaudited) |
| | |
Calculation of Maximum Offering Price Class A:
Net Asset Value and redemption price per share ($229,235,669 ÷ 17,698,870 shares) | | $ 12.95 |
| | |
Maximum offering price per share (100/96.00 of $12.95) | | $ 13.49 |
Class T:
Net Asset Value and redemption price per share ($115,016,893 ÷ 8,910,697 shares) | | $ 12.91 |
| | |
Maximum offering price per share (100/96.00 of $12.91) | | $ 13.45 |
Class B:
Net Asset Value and offering price per share ($20,209,125 ÷ 1,545,304 shares)A | | $ 13.08 |
| | |
Class C:
Net Asset Value and offering price per share ($86,743,705 ÷ 6,658,960 shares)A | | $ 13.03 |
| | |
Institutional Class:
Net Asset Value, offering price and redemption price per share ($335,659,829 ÷ 26,311,156 shares) | | $ 12.76 |
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
Six months ended June 30, 2010 (Unaudited) |
| | |
Investment Income | | |
Dividends | | $ 481,531 |
Interest | | 23,170,398 |
Income from Fidelity Central Funds | | 39,716 |
Total income | | 23,691,645 |
| | |
Expenses | | |
Management fee | $ 2,258,642 | |
Transfer agent fees | 669,175 | |
Distribution fees | 854,866 | |
Accounting and security lending fees | 166,458 | |
Custodian fees and expenses | 56,695 | |
Independent trustees' compensation | 1,756 | |
Registration fees | 116,837 | |
Audit | 31,537 | |
Legal | 481 | |
Miscellaneous | 3,497 | |
Total expenses before reductions | 4,159,944 | |
Expense reductions | (127,755) | 4,032,189 |
Net investment income | | 19,659,456 |
Realized and Unrealized Gain (Loss) Net realized gain (loss) on: | | |
Investment securities: | | |
Unaffiliated issuers | (84,092) | |
Foreign currency transactions | (112,150) | |
Total net realized gain (loss) | | (196,242) |
Change in net unrealized appreciation (depreciation) on: Investment securities | 5,076,948 | |
Assets and liabilities in foreign currencies | 5,913 | |
Total change in net unrealized appreciation (depreciation) | | 5,082,861 |
Net gain (loss) | | 4,886,619 |
Net increase (decrease) in net assets resulting from operations | | $ 24,546,075 |
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Statements - continued
Statement of Changes in Net Assets
| Six months ended
June 30, 2010
(Unaudited) | Year ended
December 31,
2009 |
Increase (Decrease) in Net Assets | | |
Operations | | |
Net investment income | $ 19,659,456 | $ 27,410,345 |
Net realized gain (loss) | (196,242) | 4,190,926 |
Change in net unrealized appreciation (depreciation) | 5,082,861 | 74,936,989 |
Net increase (decrease) in net assets resulting
from operations | 24,546,075 | 106,538,260 |
Distributions to shareholders from net investment income | (17,202,759) | (24,963,530) |
Distributions to shareholders from net realized gain | - | (647,094) |
Total distributions | (17,202,759) | (25,610,624) |
Share transactions - net increase (decrease) | 218,969,056 | 261,650,696 |
Redemption fees | 181,313 | 87,851 |
Total increase (decrease) in net assets | 226,493,685 | 342,666,183 |
| | |
Net Assets | | |
Beginning of period | 560,371,536 | 217,705,353 |
End of period (including undistributed net investment income of $5,114,398 and undistributed net investment income of $2,657,701, respectively) | $ 786,865,221 | $ 560,371,536 |
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights - Class A
| Six months ended
June 30, 2010 | Years ended December 31, |
| (Unaudited) | 2009 | 2008 | 2007 | 2006 | 2005 |
Selected Per-Share Data | | | | | |
Net asset value, beginning of period | $ 12.76 | $ 9.51 | $ 12.32 | $ 12.40 | $ 12.11 | $ 12.16 |
Income from Investment Operations | | | | | | |
Net investment income E | .374 | .950 | .675 | .709 | .715 | .727 |
Net realized and unrealized gain (loss) | .141 | 3.126 | (2.793) | (.066) | .638 | .556 |
Total from investment operations | .515 | 4.076 | (2.118) | .643 | 1.353 | 1.283 |
Distributions from net investment income | (.328) | (.814) | (.664) | (.705) | (.699) | (.744) |
Distributions from net realized gain | - | (.015) | (.030) | (.020) | (.367) | (.590) |
Total distributions | (.328) | (.829) | (.694) | (.725) | (1.066) | (1.334) |
Redemption fees added to paid in capital E | .003 | .003 | .002 | .002 | .003 | .001 |
Net asset value, end of period | $ 12.95 | $ 12.76 | $ 9.51 | $ 12.32 | $ 12.40 | $ 12.11 |
Total Return B, C, D | 4.09% | 44.11% | (17.82)% | 5.36% | 11.57% | 11.15% |
Ratios to Average Net Assets F, H | | | | | |
Expenses before reductions | 1.27% A | 1.29% | 1.32% | 1.27% | 1.28% | 1.31% |
Expenses net of fee waivers, if any | 1.20% A | 1.20% | 1.20% | 1.18% | 1.10% | 1.11% |
Expenses net of all reductions | 1.20% A | 1.20% | 1.20% | 1.17% | 1.09% | 1.11% |
Net investment income | 5.85% A | 8.13% | 5.94% | 5.75% | 5.80% | 6.04% |
Supplemental Data | | | | | | |
Net assets, end of period (000 omitted) | $ 229,236 | $ 167,196 | $ 60,543 | $ 75,584 | $ 65,593 | $ 42,836 |
Portfolio turnover rate G | 105% A | 123% | 57% | 72% | 105% | 202% |
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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
H 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 reductions from other expense offset arrangements and do not represent the amount paid by the class 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 class.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights - Class T
| Six months ended
June 30, 2010 | Years ended December 31, |
| (Unaudited) | 2009 | 2008 | 2007 | 2006 | 2005 |
Selected Per-Share Data | | | | | | |
Net asset value, beginning of period | $ 12.71 | $ 9.48 | $ 12.28 | $ 12.37 | $ 12.08 | $ 12.14 |
Income from Investment Operations | | | | | | |
Net investment income E | .373 | .924 | .676 | .704 | .701 | .713 |
Net realized and unrealized gain (loss) | .152 | 3.132 | (2.784) | (.074) | .640 | .549 |
Total from investment operations | .525 | 4.056 | (2.108) | .630 | 1.341 | 1.262 |
Distributions from net investment income | (.328) | (.814) | (.664) | (.702) | (.687) | (.733) |
Distributions from net realized gain | - | (.015) | (.030) | (.020) | (.367) | (.590) |
Total distributions | (.328) | (.829) | (.694) | (.722) | (1.054) | (1.323) |
Redemption fees added to paid in capital E | .003 | .003 | .002 | .002 | .003 | .001 |
Net asset value, end of period | $ 12.91 | $ 12.71 | $ 9.48 | $ 12.28 | $ 12.37 | $ 12.08 |
Total Return B, C, D | 4.18% | 44.04% | (17.80)% | 5.26% | 11.49% | 10.98% |
Ratios to Average Net Assets F, H | | | | | |
Expenses before reductions | 1.26% A | 1.30% | 1.32% | 1.29% | 1.36% | 1.40% |
Expenses net of fee waivers, if any | 1.20% A | 1.20% | 1.20% | 1.20% | 1.20% | 1.21% |
Expenses net of all reductions | 1.20% A | 1.20% | 1.20% | 1.19% | 1.19% | 1.21% |
Net investment income | 5.85% A | 8.13% | 5.95% | 5.73% | 5.70% | 5.94% |
Supplemental Data | | | | | | |
Net assets, end of period (000 omitted) | $ 115,017 | $ 106,446 | $ 87,427 | $ 136,031 | $ 137,200 | $ 95,102 |
Portfolio turnover rate G | 105% A | 123% | 57% | 72% | 105% | 202% |
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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
H 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 reductions from other expense offset arrangements and do not represent the amount paid by the class 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 class.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights - Class B
| Six months ended
June 30, 2010 | Years ended December 31, |
| (Unaudited) | 2009 | 2008 | 2007 | 2006 | 2005 |
Selected Per-Share Data | | | | | | |
Net asset value, beginning of period | $ 12.88 | $ 9.60 | $ 12.42 | $ 12.50 | $ 12.20 | $ 12.24 |
Income from Investment Operations | | | | | | |
Net investment income E | .336 | .861 | .609 | .632 | .628 | .640 |
Net realized and unrealized gain (loss) | .146 | 3.169 | (2.812) | (.073) | .642 | .562 |
Total from investment operations | .482 | 4.030 | (2.203) | .559 | 1.270 | 1.202 |
Distributions from net investment income | (.285) | (.738) | (.589) | (.621) | (.606) | (.653) |
Distributions from net realized gain | - | (.015) | (.030) | (.020) | (.367) | (.590) |
Total distributions | (.285) | (.753) | (.619) | (.641) | (.973) | (1.243) |
Redemption fees added to paid in capital E | .003 | .003 | .002 | .002 | .003 | .001 |
Net asset value, end of period | $ 13.08 | $ 12.88 | $ 9.60 | $ 12.42 | $ 12.50 | $ 12.20 |
Total Return B, C, D | 3.79% | 43.08% | (18.29)% | 4.61% | 10.74% | 10.34% |
Ratios to Average Net Assets F, H | | | | | |
Expenses before reductions | 1.96% A | 1.97% | 1.97% | 1.94% | 2.10% | 2.12% |
Expenses net of fee waivers, if any | 1.85% A | 1.85% | 1.85% | 1.85% | 1.85% | 1.86% |
Expenses net of all reductions | 1.85% A | 1.85% | 1.85% | 1.84% | 1.84% | 1.86% |
Net investment income | 5.20% A | 7.48% | 5.30% | 5.08% | 5.06% | 5.28% |
Supplemental Data | | | | | | |
Net assets, end of period (000 omitted) | $ 20,209 | $ 18,398 | $ 14,324 | $ 22,418 | $ 26,442 | $ 27,303 |
Portfolio turnover rate G | 105% A | 123% | 57% | 72% | 105% | 202% |
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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
H 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 reductions from other expense offset arrangements and do not represent the amount paid by the class 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 class.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights - Class C
| Six months ended
June 30, 2010 | Years ended December 31, |
| (Unaudited) | 2009 | 2008 | 2007 | 2006 | 2005 |
Selected Per-Share Data | | | | | | |
Net asset value, beginning of period | $ 12.83 | $ 9.56 | $ 12.37 | $ 12.46 | $ 12.16 | $ 12.21 |
Income from Investment Operations | | | | | | |
Net investment income E | .328 | .867 | .594 | .616 | .613 | .627 |
Net realized and unrealized gain (loss) | .148 | 3.142 | (2.798) | (.080) | .645 | .553 |
Total from investment operations | .476 | 4.009 | (2.204) | .536 | 1.258 | 1.180 |
Distributions from net investment income | (.279) | (.727) | (.578) | (.608) | (.594) | (.641) |
Distributions from net realized gain | - | (.015) | (.030) | (.020) | (.367) | (.590) |
Total distributions | (.279) | (.742) | (.608) | (.628) | (.961) | (1.231) |
Redemption fees added to paid in capital E | .003 | .003 | .002 | .002 | .003 | .001 |
Net asset value, end of period | $ 13.03 | $ 12.83 | $ 9.56 | $ 12.37 | $ 12.46 | $ 12.16 |
Total Return B, C, D | 3.76% | 43.02% | (18.37)% | 4.44% | 10.66% | 10.17% |
Ratios to Average Net Assets F, H | | | | | |
Expenses before reductions | 2.00% A | 2.02% | 2.06% | 2.04% | 2.12% | 2.16% |
Expenses net of fee waivers, if any | 1.95% A | 1.95% | 1.95% | 1.95% | 1.95% | 1.96% |
Expenses net of all reductions | 1.95% A | 1.95% | 1.95% | 1.94% | 1.94% | 1.96% |
Net investment income | 5.09% A | 7.38% | 5.20% | 4.98% | 4.95% | 5.19% |
Supplemental Data | | | | | | |
Net assets, end of period (000 omitted) | $ 86,744 | $ 63,669 | $ 22,464 | $ 30,962 | $ 28,628 | $ 18,863 |
Portfolio turnover rate G | 105% A | 123% | 57% | 72% | 105% | 202% |
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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
H 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 reductions from other expense offset arrangements and do not represent the amount paid by the class 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 class.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights - Institutional Class
| Six months ended
June 30, 2010 | Years ended December 31, |
| (Unaudited) | 2009 | 2008 | 2007 | 2006 | 2005 |
Selected Per-Share Data | | | | | |
Net asset value, beginning of period | $ 12.57 | $ 9.39 | $ 12.16 | $ 12.25 | $ 11.98 | $ 12.04 |
Income from Investment Operations | | | | | | |
Net investment income D | .384 | .990 | .695 | .725 | .725 | .739 |
Net realized and unrealized gain (loss) | .147 | 3.044 | (2.745) | (.064) | .628 | .554 |
Total from investment operations | .531 | 4.034 | (2.050) | .661 | 1.353 | 1.293 |
Distributions from net investment income | (.344) | (.842) | (.692) | (.733) | (.718) | (.764) |
Distributions from net realized gain | - | (.015) | (.030) | (.020) | (.367) | (.590) |
Total distributions | (.344) | (.857) | (.722) | (.753) | (1.085) | (1.354) |
Redemption fees added to paid in capital D | .003 | .003 | .002 | .002 | .002 | .001 |
Net asset value, end of period | $ 12.76 | $ 12.57 | $ 9.39 | $ 12.16 | $ 12.25 | $ 11.98 |
Total Return B, C | 4.29% | 44.29% | (17.52)% | 5.58% | 11.70% | 11.37% |
Ratios to Average Net Assets E,G | | | | | |
Expenses before reductions | .94% A | .97% | 1.02% | .99% | 1.02% | 1.01% |
Expenses net of fee waivers, if any | .94% A | .95% | .95% | .95% | .95% | .95% |
Expenses net of all reductions | .94% A | .95% | .95% | .95% | .94% | .95% |
Net investment income | 6.10% A | 8.38% | 6.19% | 5.97% | 5.96% | 6.20% |
Supplemental Data | | | | | | |
Net assets, end of period (000 omitted) | $ 335,660 | $ 204,663 | $ 32,947 | $ 45,232 | $ 25,177 | $ 22,134 |
Portfolio turnover rate F | 105% A | 123% | 57% | 72% | 105% | 202% |
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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
F Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
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 reductions from other expense offset arrangements and do not represent the amount paid by the class 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 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, 2010 (Unaudited)
1. Organization.
Fidelity Advisor Emerging Markets Income Fund (the Fund) is a fund of Fidelity Advisor Series VIII (the Trust) and is authorized to issue an unlimited number of shares. The Trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. The 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. Effective after the close of business on September 1, 2010, Class B shares will be closed to new accounts and additional purchases by existing shareholders. 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.
2. Investments in Fidelity Central Funds.
The Fund may invest in Fidelity Central Funds, which are open-end investment companies available only to other investment companies and accounts managed by Fidelity Management & Research Company (FMR) and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.
The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of FMR.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) web site at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC web site or upon request.
3. Significant Accounting Policies.
The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), which require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates. The following summarizes the significant accounting policies of the Fund:
Semiannual Report
Notes to Financial Statements (Unaudited) - continued
3. Significant Accounting Policies - continued
Security Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Fund uses independent pricing services approved by the Board of Trustees to value its investments. When current market prices or quotations are not readily available or reliable, valuations may be determined in good faith in accordance with procedures adopted by the Board of Trustees. Factors used in determining value may include market or security specific events, changes in interest rates and credit quality. The frequency with which these procedures are used cannot be predicted and they may be utilized to a significant extent. The value used for net asset value (NAV) calculation under these procedures may differ from published prices for the same securities.
The Fund categorizes the inputs to valuation techniques used to value its investments into a disclosure hierarchy consisting of three levels as shown below.
Level 1 - quoted prices in active markets for identical investments
Level 2 - other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, etc.)
Level 3 - unobservable inputs (including the fund's own assumptions based on the best information available)
Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. The aggregate value of investments by input level, as of June 30, 2010, for the Fund's investments, as well as a roll forward of Level 3 securities, is included at the end of the Fund's Schedule of Investments. Valuation techniques used to value the Fund's investments by major category are as follows.
Debt securities, including restricted securities, are valued based on evaluated prices received from independent pricing services or from dealers who make markets in such securities. For corporate bonds, foreign government and government agency obligations, preferred securities, supranational obligations, and U.S. government and government agency obligations, pricing services utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type as well as dealer supplied prices and are generally categorized as Level 2 in the hierarchy. 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 and are categorized as Level 2 in the hierarchy. The Fund invests a significant portion of its assets in below investment grade securities. The value of these securities can be more volatile due to changes in the credit quality of the issuer and is sensitive to changes in economic, market and regulatory conditions.
Semiannual Report
3. Significant Accounting Policies - continued
Security Valuation - continued
When independent prices are unavailable or unreliable, debt securities may be valued utilizing pricing matrices which consider similar factors that would be used by independent pricing services. These are generally categorized as Level 2 in the hierarchy but may be Level 3 depending on the circumstances.
Exchange-traded funds (ETFs) are valued at their last sale price or official closing price as reported by an independent pricing service on the primary market or exchange on which they are traded and are categorized as Level 1 in the hierarchy. In the event there were no sales during the day but the exchange reports a closing bid level, ETFs are valued at the closing bid and would be categorized as Level 1 in the hierarchy. In the event there was no closing bid, ETFs may be valued by another method that the Board of Trustees believes reflects fair value in accordance with the Board's fair value pricing policies and may be categorized as Level 2 in the hierarchy.
Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value each business day and are categorized as Level 1 in the hierarchy.
Foreign Currency. The Fund uses foreign currency contracts to facilitate transactions in foreign-denominated securities. Gains and 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. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. 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
Semiannual Report
Notes to Financial Statements (Unaudited) - continued
3. Significant Accounting Policies - continued
Investment Transactions and Income - continued
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. Interest income and distributions from the Fidelity 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. Debt obligations may be placed on non-accrual status and related interest income may be reduced by ceasing current accruals and writing off interest receivables when the collection of all or a portion of interest has become doubtful based on consistently applied procedures. A debt obligation is removed from non-accrual status when the issuer resumes interest payments or when collectability of interest is reasonably assured.
Expenses. Most expenses of the Trust can be directly attributed to a fund. Expenses which cannot be directly attributed are apportioned amongst each fund in the Trust. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company by distributing substantially all of its taxable income and realized gains under Subchapter M of the Internal Revenue Code and filing its U.S. federal tax return. As a result, no provision for income taxes is required. A fund's federal tax return is subject to examination by the Internal Revenue Service (IRS) for a period of three years. 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.
Dividends are declared daily and paid monthly from net investment income. Distributions from realized gains, if any, 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 GAAP.
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, defaulted bonds, market discount, deferred trustees compensation, capital loss carryforwards and losses deferred due to wash sales and excise tax regulations.
Semiannual Report
3. Significant Accounting Policies - continued
Income Tax Information and Distributions to Shareholders - continued
The federal tax cost of investment securities and unrealized appreciation (depreciation) as of period end were as follows:
Gross unrealized appreciation | $ 39,700,967 |
Gross unrealized depreciation | (8,789,262) |
Net unrealized appreciation (depreciation) | $ 30,911,705 |
| |
Tax cost | $ 740,764,433 |
Short-Term Trading (Redemption) Fees. Shares held in the Fund less than 90 days are subject to a redemption fee equal to 1.00% of the proceeds of the redeemed shares. All redemption fees, including any estimated redemption fees paid by FMR, are retained by the Fund and accounted for as an addition to paid in capital.
4. Operating Policies.
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.
5. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities and U.S. government securities, aggregated $414,441,286 and $242,595,494, respectively.
6. 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 .55% of the Fund's average net assets and a group fee rate that averaged .12% 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 .67% of the Fund's average net assets.
Semiannual Report
Notes to Financial Statements (Unaudited) - continued
6. Fees and Other Transactions with Affiliates - continued
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 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 | -% | .25% | $ 254,878 | $ 3,440 |
Class T | -% | .25% | 141,667 | - |
Class B | .65% | .25% | 88,341 | 66,256 |
Class C | .75% | .25% | 369,980 | 183,868 |
| | | $ 854,866 | $ 253,564 |
Sales Load. FDC receives a front-end sales charge of up to 4.00% for selling Class A shares and 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, ..75% to .50% for certain purchases of Class A shares 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 | $ 33,002 |
Class T | 8,480 |
Class B* | 22,019 |
Class C* | 16,450 |
| $ 79,951 |
* 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.
Semiannual Report
6. Fees and Other Transactions with Affiliates - continued
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 shareholder reports, except proxy statements. For the period, the total transfer agent fees paid by each class were as follows:
| Amount | % of
Average
Net Assets* |
Class A | $ 231,472 | .23 |
Class T | 126,137 | .22 |
Class B | 25,649 | .26 |
Class C | 74,899 | .20 |
Institutional Class | 211,018 | .16 |
| $ 669,175 | |
* 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.
7. Committed Line of Credit.
The Fund participates with other funds managed by FMR in a $3.75 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 amounted to $1,123 and is reflected in Miscellaneous expenses on the Statement of Operations. During the period, there were no borrowings on this line of credit.
8. 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
Semiannual Report
Notes to Financial Statements (Unaudited) - continued
8. Security Lending - continued
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. At period end, there were no security loans outstanding. 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 Fidelity Central Funds. Net income from lending portfolio securities during the period amounted to $7.
9. Expense Reductions.
FMR voluntarily agreed to reimburse each class to the extent annual operating expenses exceeded certain levels of average net assets as noted in the table below. Some expenses, for example interest expense, including commitment fees, are excluded from this reimbursement.
The following classes were in reimbursement during the period:
| Expense
Limitations | Reimbursement
from adviser |
| | |
Class A | 1.20% | $ 65,024 |
Class T | 1.20% | 35,290 |
Class B | 1.85% | 10,327 |
Class C | 1.95% | 16,238 |
| | $ 126,879 |
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 $570 for the period. In addition, through arrangements with the Fund's custodian, 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 expenses by $306.
Semiannual Report
10. Distributions to Shareholders.
Distributions to shareholders of each class were as follows:
| Six months ended
June 30,
2010 | Year ended
December 31,
2009 |
From net investment income | | |
Class A | $ 5,139,826 | $ 7,132,338 |
Class T | 2,882,182 | 6,958,625 |
Class B | 428,077 | 1,003,714 |
Class C | 1,575,080 | 2,468,243 |
Institutional Class | 7,177,594 | 7,400,610 |
Total | $ 17,202,759 | $ 24,963,530 |
From net realized gain | | |
Class A | $ - | $ 193,016 |
Class T | - | 123,558 |
Class B | - | 21,170 |
Class C | - | 72,723 |
Institutional Class | - | 236,627 |
Total | $ - | $ 647,094 |
11. Share Transactions.
Transactions for each class of shares were as follows:
| Shares | Dollars |
| Six months ended
June 30,
2010 | Year ended
December 31,
2009 | Six months ended
June 30,
2010 | Year ended
December 31,
2009 |
Class A | | | | |
Shares sold | 7,435,480 | 8,915,226 | $ 96,435,397 | $ 108,963,057 |
Reinvestment of distributions | 339,385 | 540,320 | 4,391,443 | 6,421,068 |
Shares redeemed | (3,182,511) | (2,712,377) | (41,058,354) | (30,467,236) |
Net increase (decrease) | 4,592,354 | 6,743,169 | $ 59,768,486 | $ 84,916,889 |
Class T | | | | |
Shares sold | 1,484,168 | 2,295,615 | $ 19,163,046 | $ 26,938,453 |
Reinvestment of distributions | 192,544 | 535,436 | 2,481,771 | 6,153,825 |
Shares redeemed | (1,138,330) | (3,676,469) | (14,661,279) | (42,208,743) |
Net increase (decrease) | 538,382 | (845,418) | $ 6,983,538 | $ (9,116,465) |
Semiannual Report
Notes to Financial Statements (Unaudited) - continued
11. Share Transactions - continued
Transactions for each class of shares were as follows: - continued
| Shares | Dollars |
| Six months ended
June 30,
2010 | Year ended
December 31,
2009 | Six months ended
June 30,
2010 | Year ended
December 31,
2009 |
Class B | | | | |
Shares sold | 399,625 | 399,800 | $ 5,248,292 | $ 4,901,028 |
Reinvestment of distributions | 26,346 | 72,990 | 343,929 | 851,775 |
Shares redeemed | (309,412) | (536,535) | (4,042,175) | (5,974,173) |
Net increase (decrease) | 116,559 | (63,745) | $ 1,550,046 | $ (221,370) |
Class C | | | | |
Shares sold | 2,526,852 | 3,284,954 | $ 32,984,015 | $ 40,335,680 |
Reinvestment of distributions | 95,993 | 171,629 | 1,248,366 | 2,056,422 |
Shares redeemed | (927,132) | (842,206) | (12,009,982) | (9,820,911) |
Net increase (decrease) | 1,695,713 | 2,614,377 | $ 22,222,399 | $ 32,571,191 |
Institutional Class | | | | |
Shares sold | 13,020,386 | 14,734,937 | $ 166,413,829 | $ 176,271,975 |
Reinvestment of distributions | 292,787 | 357,732 | 3,731,373 | 4,285,454 |
Shares redeemed | (3,284,033) | (2,321,252) | (41,700,615) | (27,056,978) |
Net increase (decrease) | 10,029,140 | 12,771,417 | $ 128,444,587 | $ 153,500,451 |
12. 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.
13. Credit Risk.
The Fund's relatively large investment in countries with limited or developing capital markets may involve greater risks than investments in more developed markets and the prices of such investments may be volatile. The yields of emerging market debt obligations reflect, among other things, perceived credit risk. The consequences of political, social or economic changes in these markets may have disruptive effects on the market prices of the Fund's investments and the income they generate, as well as the Fund's ability to repatriate such amounts.
Semiannual Report
Investment Adviser
Fidelity Management & Research Company
Boston, MA
Investment Sub-Advisers
FMR Co., Inc.
Fidelity Management &
Research (U.K.) Inc.
Fidelity Research & Analysis Company
FIL Investments (Japan) Limited
FIL Investment Advisors
FIL Investment Advisors (U.K.) Ltd.
Fidelity Management & Research
(Hong Kong) Limited
Fidelity Management & Research
(Japan) Inc.
General Distributor
Fidelity Distributors Corporation
Boston, MA
Transfer and Service Agents
Fidelity Investments Institutional Operations Company, Inc.
Boston, MA
Fidelity Service Company, Inc.
Boston, MA
Custodian
JPMorgan Chase Bank
New York, NY
EMI-USAN-0810
1.787773.107
(Fidelity Investment logo)(registered trademark)
Fidelity® Advisor
Emerging Markets Income
Fund - Institutional Class
Semiannual Report
June 30, 2010
(2_fidelity_logos) (Registered_Trademark)
Contents
Chairman's Message | <Click Here> | The Chairman's message to shareholders. |
Shareholder Expense Example | <Click Here> | An example of shareholder expenses. |
Investment Changes | <Click Here> | A summary of major shifts in the fund's investments over the past six months. |
Investments | <Click Here> | A complete list of the fund's investments with their market values. |
Financial Statements | <Click Here> | Statements of assets and liabilities, operations, and changes in net assets, as well as financial highlights. |
Notes | <Click Here> | Notes to the financial statements. |
To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://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 LLC 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 holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com or http://www.advisor.fidelity.com, as applicable.
NOT FDIC INSURED • MAY LOSE VALUE • NO BANK GUARANTEE
Neither the fund nor Fidelity Distributors Corporation is a bank.
Semiannual Report
(photo_of_Edward_C_Johnson_3d)
Dear Shareholder:
A yearlong uptrend in global equity markets came under significant pressure in May 2010 when investor sentiment turned bearish amid growing concern that Europe's debt crisis would expand and slow or derail economic recovery. Financial markets are always unpredictable, of course, but there also are several time-tested investment principles that can help put the 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 can be tax advantages and cost benefits to consider as well. 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 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 "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 by phone. It is our privilege to provide you the information you need to make the investments that are right for you.
Sincerely,
(The chairman's signature appears here.)
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, redemption fees, 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, 2010 to June 30, 2010).
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. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
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. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
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.
Semiannual Report
Shareholder Expense Example - continued
|
Annualized
Expense Ratio
|
Beginning
Account Value
January 1, 2010
|
Ending
Account Value
June 30, 2010
| Expenses Paid
During Period*
January 1, 2010 to
June 30, 2010 |
Class A | 1.20% | | | |
Actual | | $ 1,000.00 | $ 1,040.90 | $ 6.07 |
Hypothetical A | | $ 1,000.00 | $ 1,018.84 | $ 6.01 |
Class T | 1.20% | | | |
Actual | | $ 1,000.00 | $ 1,041.80 | $ 6.08 |
Hypothetical A | | $ 1,000.00 | $ 1,018.84 | $ 6.01 |
Class B | 1.85% | | | |
Actual | | $ 1,000.00 | $ 1,037.90 | $ 9.35 |
Hypothetical A | | $ 1,000.00 | $ 1,015.62 | $ 9.25 |
Class C | 1.95% | | | |
Actual | | $ 1,000.00 | $ 1,037.60 | $ 9.85 |
Hypothetical A | | $ 1,000.00 | $ 1,015.12 | $ 9.74 |
Institutional Class | .94% | | | |
Actual | | $ 1,000.00 | $ 1,042.90 | $ 4.76 |
Hypothetical A | | $ 1,000.00 | $ 1,020.13 | $ 4.71 |
A 5% return per year before expenses
* Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).
Semiannual Report
Investment Changes (Unaudited)
Top Five Countries as of June 30, 2010 |
(excluding cash equivalents) | % of fund's
net assets | % of fund's net assets
6 months ago |
United States of America | 9.1 | 6.0 |
Brazil | 7.2 | 8.3 |
Russia | 6.9 | 8.0 |
Turkey | 6.8 | 4.6 |
Indonesia | 5.9 | 6.8 |
Percentages are adjusted for the effect of open futures contracts, if applicable. |
Top Five Holdings as of June 30, 2010 |
(by issuer, excluding cash equivalents) | % of fund's
net assets | % of fund's net assets
6 months ago |
Turkish Republic | 6.8 | 4.6 |
Russian Federation | 6.7 | 8.0 |
Brazilian Federative Republic | 5.1 | 6.6 |
Indonesian Republic | 5.0 | 6.0 |
U.S. Treasury Obligations | 4.5 | 1.8 |
| 28.1 | |
Asset Allocation (% of fund's net assets) |
As of June 30, 2010 | As of December 31, 2009 |
| Corporate Bonds 22.7% | | | Corporate Bonds 19.0% | |
| Government
Obligations 64.6% | | | Government
Obligations 66.1% | |
| Supranational Obligations 0.6% | | | Supranational Obligations 0.8% | |
| Stocks and Investment
Companies 1.3% | | | Stocks and Investment
Companies 2.9% | |
| Preferred Securities 0.9% | | | Preferred Securities 0.7% | |
| Short-Term
Investments and
Net Other Assets 9.9% | | | Short-Term
Investments and
Net Other Assets 10.5% | |
Semiannual Report
Investments June 30, 2010 (Unaudited)
Showing Percentage of Net Assets
Nonconvertible Bonds - 22.7% |
| Principal Amount (b) | | Value |
Argentina - 0.6% |
City of Buenos Aires 12.5% 4/6/15 (d) | | $ 1,920,000 | | $ 1,939,200 |
Pan American Energy LLC 7.875% 5/7/21 (d) | | 2,415,000 | | 2,390,850 |
TOTAL ARGENTINA | | 4,330,050 |
Australia - 0.0% |
Leighton Finance International 7.875% 5/16/11 | | 250,000 | | 251,875 |
Bahamas (Nassau) - 0.2% |
Odebrecht Overseas Ltd. 9.625% | | 1,615,000 | | 1,615,000 |
Bermuda - 0.2% |
Noble Group Ltd.: | | | | |
6.75% 1/29/20 (d) | | 930,000 | | 892,800 |
8.5% 5/30/13 (Reg. S) | | 250,000 | | 273,750 |
TOTAL BERMUDA | | 1,166,550 |
Brazil - 1.9% |
Banco Cruzeiro Do Sul SA 8.5% 2/20/15 (d) | | 1,550,000 | | 1,588,750 |
Banco do Brasil SA 4.5% 1/22/15 (d) | | 1,475,000 | | 1,489,750 |
Banco Nacional de Desenvolvimento Economico e Social 5.5% 7/12/20 (d) | | 3,260,000 | | 3,260,000 |
Banco Votorantim SA 7.375% 1/21/20 (d) | | 1,110,000 | | 1,137,750 |
BFF International Ltd. 7.25% 1/28/20 (d) | | 1,445,000 | | 1,483,004 |
Braskem Finance Ltd. 7% 5/7/20 (d) | | 1,830,000 | | 1,848,300 |
Centrais Eletricas Brasileiras SA (Electrobras) 6.875% 7/30/19 (d) | | 820,000 | | 889,700 |
Net Servicos de Comunicacao SA 7.5% 1/27/20 (d) | | 1,850,000 | | 1,928,625 |
Rearden G Holdings Eins GmbH 7.875% 3/30/20 (d) | | 970,000 | | 977,275 |
TOTAL BRAZIL | | 14,603,154 |
British Virgin Islands - 0.0% |
Road King Infrastructure Finance 2004 Ltd. 6.25% 7/15/11 | | 235,000 | | 234,413 |
Cayman Islands - 2.3% |
Banco Bradesco SA 4.1% 3/23/15 (d) | | 1,990,000 | | 1,980,050 |
Country Garden Holdings Co. Ltd. 11.25% 4/22/17 (d) | | 845,000 | | 790,075 |
CSN Islands XI Corp. 6.875% 9/21/19 (d) | | 1,910,000 | | 1,942,470 |
Hutchison Whampoa International 09 Ltd. 7.625% 4/9/19 (Reg. S) | | 1,035,000 | | 1,234,599 |
Lumena Resources Corp. 12% 10/27/14 (d) | | 265,000 | | 225,250 |
Odebrecht Finance Ltd.: | | | | |
7% 4/21/20 (d) | | 1,480,000 | | 1,502,200 |
9.625% 4/9/14 (d) | | 1,430,000 | | 1,673,100 |
Petrobras International Finance Co. Ltd. 5.75% 1/20/20 | | 1,795,000 | | 1,807,651 |
Pontis Ltd. 6.25% 7/20/10 (d) | | 3,260,000 | | 3,211,100 |
Nonconvertible Bonds - continued |
| Principal Amount (b) | | Value |
Cayman Islands - continued |
TDIC Finance Ltd. 6.5% 7/2/14 (d) | | $ 2,320,000 | | $ 2,467,900 |
Voto-Votorantim Overseas Trading Operations V Ltd. 6.625% 9/25/19 (d) | | 1,540,000 | | 1,559,250 |
TOTAL CAYMAN ISLANDS | | 18,393,645 |
Colombia - 0.2% |
Empresas Publicas de Medellin 7.625% 7/29/19 (d) | | 1,390,000 | | 1,560,275 |
Egypt - 0.2% |
African Export-Import Bank 8.75% 11/13/14 | | 1,740,000 | | 1,844,400 |
Indonesia - 0.4% |
Adaro Indonesia PT 7.625% 10/22/19 (d) | | 2,210,000 | | 2,243,150 |
APP International Finance (Mauritius) Ltd.: | | | | |
0% 7/5/01 (a)(d) | | 1,235,000 | | 0 |
0% 7/5/01 (Reg. S) (a) | | 445,000 | | 0 |
BLT Finance BV 7.5% 5/15/14 (Reg. S) | | 245,000 | | 163,856 |
Listrindo Capital BV 9.25% 1/29/15 (d) | | 740,000 | | 777,000 |
TOTAL INDONESIA | | 3,184,006 |
Ireland - 0.4% |
Vimpel Communications: | | | | |
8.375% 4/30/13 (Issued by VIP Finance Ireland Ltd. for Vimpel Communications) (d) | | 1,455,000 | | 1,535,025 |
9.125% 4/30/18 (Issued by VIP Finance Ireland Ltd. for Vimpel Communications) (d) | | 1,455,000 | | 1,567,763 |
TOTAL IRELAND | | 3,102,788 |
Isle of Man - 0.2% |
AngloGold Ashanti Holdings PLC 5.375% 4/15/20 | | 1,885,000 | | 1,880,495 |
Korea (South) - 1.9% |
Export-Import Bank of Korea: | | | | |
5.125% 6/29/20 | | 1,660,000 | | 1,664,482 |
8.125% 1/21/14 | | 1,360,000 | | 1,548,224 |
Hyundai Capital Services, Inc. 6% 5/5/15 (d) | | 1,960,000 | | 2,058,000 |
Industrial Bank of Korea 7.125% 4/23/14 (d) | | 1,620,000 | | 1,808,568 |
Korea Development Bank 4.375% 8/10/15 | | 1,930,000 | | 1,971,688 |
Korea Expressway Corp. 4.5% 3/23/15 (d) | | 1,940,000 | | 1,980,934 |
POSCO 8.75% 3/26/14 (d) | | 1,590,000 | | 1,878,585 |
SK Broadband Co., Ltd. 7% 2/1/12 (d) | | 1,490,000 | | 1,545,875 |
Woori Bank 7% 2/2/15 (d) | | 690,000 | | 753,342 |
TOTAL KOREA (SOUTH) | | 15,209,698 |
Nonconvertible Bonds - continued |
| Principal Amount (b) | | Value |
Luxembourg - 1.9% |
ArcelorMittal SA 9% 2/15/15 | | $ 1,080,000 | | $ 1,270,574 |
Millicom International Cellular SA 10% 12/1/13 | | 1,800,000 | | 1,854,000 |
OJSC Russian Agricultural Bank: | | | | |
6.299% 5/15/17 (Issued by RSHB Capital SA for OJSC Russian Agricultural Bank) (d) | | 1,665,000 | | 1,652,513 |
6.97% 9/21/16 (Issued by RSHB Capital SA for OJSC Russian Agricultural Bank) (e) | | 565,000 | | 557,938 |
7.125% 1/14/14 (Issued by RSHB Capital SA for OJSC Russian Agricultural Bank) (d) | | 1,355,000 | | 1,432,913 |
7.175% 5/16/13 (Issued by RSHB Capital SA for OJSC Russian Agricultural Bank) (d) | | 1,040,000 | | 1,094,600 |
7.75% 5/29/18 (Issued by RSHB Capital SA for OJSC Russian Agricultural Bank) (d) | | 1,265,000 | | 1,353,550 |
RSHB Capital SA 9% 6/11/14 (d) | | 1,215,000 | | 1,363,838 |
TNK-BP Finance SA: | | | | |
7.5% 3/13/13 (d) | | 1,070,000 | | 1,128,850 |
7.875% 3/13/18 (Reg. S) | | 1,450,000 | | 1,511,625 |
VTB Capital SA 6.465% 3/4/15 (d) | | 1,860,000 | | 1,860,000 |
TOTAL LUXEMBOURG | | 15,080,401 |
Mexico - 0.7% |
Alestra SA de RL de CV 11.75% 8/11/14 | | 1,320,000 | | 1,405,800 |
America Movil SAB de CV 3.625% 3/30/15 (d) | | 1,479,000 | | 1,517,155 |
Petroleos Mexicanos 6% 3/5/20 (d) | | 2,105,000 | | 2,199,725 |
Vitro SAB de CV 9.125% 2/1/17 (a) | | 675,000 | | 310,500 |
TOTAL MEXICO | | 5,433,180 |
Netherlands - 4.6% |
Bulgaria Steel Finance BV 12% 5/4/13 unit (a) | EUR | 600,000 | | 73,368 |
DTEK Finance BV 9.5% 4/28/15 (d) | | 1,560,000 | | 1,474,200 |
Indosat Finance Co. BV 7.75% 11/5/10 | | 625,000 | | 631,250 |
Intergas Finance BV: | | | | |
6.375% 5/14/17 (Reg. S) | | 2,080,000 | | 2,080,000 |
6.875% 11/4/11 (Reg. S) | | 954,000 | | 982,620 |
Kazakhstan Temir Zholy Finance BV 6.5% 5/11/11 | | 1,110,000 | | 1,118,325 |
KazMunaiGaz Finance Sub BV: | | | | |
7% 5/5/20 (d) | | 3,170,000 | | 3,173,170 |
8.375% 7/2/13 (d) | | 2,660,000 | | 2,859,500 |
9.125% 7/2/18 (d) | | 3,700,000 | | 4,250,375 |
11.75% 1/23/15 (d) | | 3,750,000 | | 4,584,375 |
Lippo Karawaci Finance BV 8.875% 3/9/11 | | 260,000 | | 264,888 |
Nonconvertible Bonds - continued |
| Principal Amount (b) | | Value |
Netherlands - continued |
Majapahit Holding BV: | | | | |
7.25% 6/28/17 (Reg. S) | | $ 1,105,000 | | $ 1,179,588 |
7.75% 10/17/16 (Reg. S) | | 1,720,000 | | 1,896,300 |
7.75% 1/20/20 (d) | | 3,340,000 | | 3,657,300 |
7.875% 6/29/37 (Reg. S) | | 3,065,000 | | 3,110,975 |
8% 8/7/19 (d) | | 1,700,000 | | 1,878,500 |
Matahari International Finance Co. BV 10.75% 8/7/12 | | 1,690,000 | | 1,768,247 |
Paiton Energy Funding BV 9.34% 2/15/14 (Reg. S) | | 247,000 | | 251,940 |
PT Indosat International Finance Co. BV 7.125% 6/22/12 (d) | | 1,090,000 | | 1,122,700 |
TOTAL NETHERLANDS | | 36,357,621 |
Peru - 0.1% |
CFG Investment SAC 9.25% 12/19/13 (Reg. S) | | 705,000 | | 712,050 |
Philippines - 1.5% |
National Power Corp. 6.875% 11/2/16 (d) | | 2,885,000 | | 3,173,500 |
Power Sector Assets and Liabilities Management Corp.: | | | | |
7.25% 5/27/19 (d) | | 3,700,000 | | 4,084,060 |
7.39% 12/2/24 (d) | | 4,260,000 | | 4,659,375 |
TOTAL PHILIPPINES | | 11,916,935 |
Qatar - 0.2% |
Qtel International Finance Ltd. 6.5% 6/10/14 (d) | | 1,310,000 | | 1,434,450 |
Russia - 0.2% |
MTS International Funding Ltd. 8.625% 6/22/20 (d) | | 1,555,000 | | 1,606,471 |
Trinidad & Tobago - 0.3% |
Petroleum Co. of Trinidad & Tobago Ltd. 9.75% 8/14/19 (d) | | 2,045,000 | | 2,336,413 |
Ukraine - 0.4% |
Naftogaz of Ukraine NJSC 9.5% 9/30/14 | | 2,770,000 | | 2,873,875 |
United Arab Emirates - 0.6% |
Dolphin Energy Ltd. 5.888% 6/15/19 (d) | | 2,906,679 | | 3,008,413 |
Dubai Electricity & Water Authority 8.5% 4/22/15 (d) | | 1,850,000 | | 1,882,375 |
TOTAL UNITED ARAB EMIRATES | | 4,890,788 |
United Kingdom - 0.6% |
EXIM of Ukraine 7.65% 9/7/11 (Issued by Credit Suisse International for EXIM of Ukraine) | | 4,345,000 | | 4,279,825 |
United States of America - 2.6% |
Drummond Co., Inc. 9% 10/15/14 (d) | | 3,062,000 | | 3,107,930 |
Gerdau Holdings, Inc. 7% 1/20/20 (d) | | 1,365,000 | | 1,386,840 |
Nonconvertible Bonds - continued |
| Principal Amount (b) | | Value |
United States of America - continued |
NII Capital Corp.: | | | | |
8.875% 12/15/19 | | $ 1,875,000 | | $ 1,921,875 |
10% 8/15/16 | | 2,100,000 | | 2,210,250 |
Pemex Project Funding Master Trust 8.625% 2/1/22 | | 5,800,000 | | 7,163,000 |
Southern Copper Corp.: | | | | |
5.375% 4/16/20 | | 845,000 | | 847,113 |
6.75% 4/16/40 | | 3,975,000 | | 3,955,125 |
TOTAL UNITED STATES OF AMERICA | | 20,592,133 |
Venezuela - 0.5% |
Petroleos de Venezuela SA: | | | | |
5.25% 4/12/17 | | 3,585,000 | | 1,917,975 |
5.375% 4/12/27 | | 3,535,000 | | 1,573,075 |
TOTAL VENEZUELA | | 3,491,050 |
TOTAL NONCONVERTIBLE BONDS (Cost $174,028,660) | 178,381,541 |
Government Obligations - 64.6% |
|
Argentina - 2.8% |
Argentine Republic: | | | | |
discount (with partial capitalization through 12/31/13) 8.28% 12/31/33 | | 8,300,635 | | 5,582,177 |
par 2.5% 12/31/38 (c) | | 10,520,000 | | 3,734,600 |
0% 12/15/35 | | 7,523,560 | | 583,076 |
7% 9/12/13 | | 10,790,000 | | 9,390,897 |
discount (with partial capitalization through 12/31/13) 8.28% 12/31/33 | | 3,257,600 | | 2,174,448 |
8.75% 6/2/17 | | 703,801 | | 594,712 |
TOTAL ARGENTINA | | 22,059,910 |
Bahamas (Nassau) - 0.5% |
Bahamian Republic 6.95% 11/20/29 (d) | | 3,740,000 | | 3,740,000 |
Barbados - 0.4% |
Barbados Government 7.25% 12/15/21 (d) | | 2,635,000 | | 2,793,100 |
Belize - 0.2% |
Belize Government 6% 2/20/29 (c)(d) | | 2,354,700 | | 1,730,705 |
Brazil - 5.1% |
Brazilian Federative Republic: | | | | |
5.625% 1/7/41 | | 5,945,000 | | 5,855,825 |
Government Obligations - continued |
| Principal Amount (b) | | Value |
Brazil - continued |
Brazilian Federative Republic: - continued | | | | |
5.875% 1/15/19 | | $ 4,665,000 | | $ 5,131,500 |
7.125% 1/20/37 | | 3,070,000 | | 3,647,160 |
8% 1/15/18 | | 1,693,333 | | 1,972,733 |
8.25% 1/20/34 | | 2,040,000 | | 2,692,800 |
8.875% 4/15/24 | | 2,290,000 | | 3,102,950 |
10.125% 5/15/27 | | 2,990,000 | | 4,485,000 |
11% 8/17/40 | | 4,600,000 | | 6,175,500 |
12.25% 3/6/30 | | 2,015,000 | | 3,526,250 |
12.5% 1/5/16 | BRL | 4,105,000 | | 2,523,356 |
12.75% 1/15/20 | | 850,000 | | 1,377,000 |
TOTAL BRAZIL | | 40,490,074 |
Cayman Islands - 0.5% |
Cayman Island Government 5.95% 11/24/19 (d) | | 3,880,000 | | 3,880,000 |
Colombia - 2.2% |
Colombian Republic: | | | | |
6.125% 1/18/41 | | 4,635,000 | | 4,681,350 |
7.375% 3/18/19 | | 2,005,000 | | 2,345,850 |
10.375% 1/28/33 | | 3,790,000 | | 5,495,500 |
11.75% 2/25/20 | | 3,393,000 | | 5,030,123 |
TOTAL COLOMBIA | | 17,552,823 |
Congo - 0.6% |
Congo Republic 3% 6/30/29 (c) | | 8,298,250 | | 4,398,073 |
Croatia - 0.6% |
Croatia Republic 6.75% 11/5/19 (d) | | 4,890,000 | | 5,071,908 |
Dominican Republic - 0.9% |
Dominican Republic: | | | | |
7.5% 5/6/21 (d) | | 3,240,000 | | 3,337,200 |
9.04% 1/23/18 (d) | | 3,202,422 | | 3,554,689 |
TOTAL DOMINICAN REPUBLIC | | 6,891,889 |
Ecuador - 0.4% |
Ecuador Republic 9.375% 12/15/15 (d) | | 3,940,000 | | 3,467,200 |
Egypt - 0.3% |
Arab Republic of Egypt 5.75% 4/29/20 (d) | | 2,690,000 | | 2,703,450 |
El Salvador - 1.0% |
El Salvador Republic: | | | | |
7.375% 12/1/19 (d) | | 2,705,000 | | 2,948,450 |
7.65% 6/15/35 (Reg. S) | | 2,975,000 | | 3,153,500 |
Government Obligations - continued |
| Principal Amount (b) | | Value |
El Salvador - continued |
El Salvador Republic: - continued | | | | |
7.75% 1/24/23 (Reg. S) | | $ 1,050,000 | | $ 1,149,750 |
8.25% 4/10/32 (Reg. S) | | 865,000 | | 951,500 |
TOTAL EL SALVADOR | | 8,203,200 |
Gabon - 0.9% |
Gabonese Republic 8.2% 12/12/17 (d) | | 6,590,000 | | 6,993,638 |
Georgia - 0.8% |
Georgia Republic 7.5% 4/15/13 | | 5,875,000 | | 6,080,625 |
Ghana - 1.0% |
Ghana Republic: | | | | |
8.5% 10/4/17 (d) | | 6,555,000 | | 6,882,750 |
14.99% 3/11/13 | GHS | 1,380,000 | | 945,575 |
TOTAL GHANA | | 7,828,325 |
Hungary - 0.3% |
Hungarian Republic 6.25% 1/29/20 | | 1,990,000 | | 1,950,200 |
Indonesia - 5.5% |
Indonesian Republic: | | | | |
5.875% 3/13/20 (d) | | 2,610,000 | | 2,750,418 |
6.625% 2/17/37 (d) | | 3,145,000 | | 3,302,250 |
6.75% 3/10/14 (Reg. S) | | 1,940,000 | | 2,138,850 |
6.875% 3/9/17 (d) | | 1,990,000 | | 2,243,725 |
6.875% 1/17/18 (d) | | 3,825,000 | | 4,312,688 |
7.25% 4/20/15 (d) | | 1,615,000 | | 1,841,100 |
7.5% 1/15/16 (d) | | 5,310,000 | | 6,159,600 |
7.75% 1/17/38 (d) | | 3,485,000 | | 4,112,300 |
8.5% 10/12/35 (d) | | 4,440,000 | | 5,594,400 |
10.375% 5/4/14 (d) | | 1,715,000 | | 2,105,163 |
11.625% 3/4/19 (d) | | 3,685,000 | | 5,287,975 |
Perusahaan Penerbit SBSN Indonesia 8.8% 4/23/14 (d) | | 3,070,000 | | 3,568,875 |
TOTAL INDONESIA | | 43,417,344 |
Iraq - 0.8% |
Republic of Iraq 5.8% 1/15/28 (Reg. S) | | 7,270,000 | | 5,888,700 |
Ivory Coast - 1.4% |
Ivory Coast 2.45% 12/31/32 (c) | | 19,815,000 | | 10,700,100 |
Jamaica - 0.1% |
Jamaican Government 8% 3/15/39 | | 1,228,000 | | 1,105,200 |
Government Obligations - continued |
| Principal Amount (b) | | Value |
Lebanon - 1.6% |
Lebanese Republic: | | | | |
4% 12/31/17 | | $ 6,067,500 | | $ 5,803,564 |
9% 3/20/17 | | 2,365,000 | | 2,778,875 |
11.625% 5/11/16 (Reg. S) | | 3,290,000 | | 4,227,650 |
TOTAL LEBANON | | 12,810,089 |
Lithuania - 0.9% |
Lithuanian Republic: | | | | |
6.75% 1/15/15 (d) | | 3,515,000 | | 3,676,690 |
7.375% 2/11/20 (d) | | 3,545,000 | | 3,718,705 |
TOTAL LITHUANIA | | 7,395,395 |
Mexico - 3.6% |
United Mexican States: | | | | |
5.125% 1/15/20 | | 1,516,000 | | 1,588,010 |
5.625% 1/15/17 | | 9,317,000 | | 10,248,700 |
6.05% 1/11/40 | | 6,594,000 | | 6,956,670 |
11.375% 9/15/16 | | 1,939,000 | | 2,733,990 |
11.5% 5/15/26 | | 3,945,000 | | 6,726,225 |
TOTAL MEXICO | | 28,253,595 |
Pakistan - 1.2% |
Islamic Republic of Pakistan: | | | | |
6.875% 6/1/17 (d) | | 7,665,000 | | 6,975,150 |
7.125% 3/31/16 (d) | | 2,320,000 | | 2,157,600 |
TOTAL PAKISTAN | | 9,132,750 |
Panama - 0.5% |
Panamanian Republic 5.2% 1/30/20 | | 3,740,000 | | 3,880,250 |
Peru - 0.9% |
Peruvian Republic: | | | | |
7.35% 7/21/25 | | 2,725,000 | | 3,265,913 |
8.75% 11/21/33 | | 2,940,000 | | 3,983,700 |
TOTAL PERU | | 7,249,613 |
Philippines - 3.2% |
Philippine Republic: | | | | |
6.375% 10/23/34 | | 7,350,000 | | 7,369,110 |
6.5% 1/20/20 | | 6,065,000 | | 6,672,107 |
7.75% 1/14/31 | | 3,395,000 | | 3,934,126 |
Government Obligations - continued |
| Principal Amount (b) | | Value |
Philippines - continued |
Philippine Republic: - continued | | | | |
9.5% 2/2/30 | | $ 3,300,000 | | $ 4,463,250 |
10.625% 3/16/25 | | 1,765,000 | | 2,546,013 |
TOTAL PHILIPPINES | | 24,984,606 |
Poland - 0.6% |
Polish Government 6.375% 7/15/19 | | 4,510,000 | | 4,915,900 |
Qatar - 0.8% |
State of Qatar: | | | | |
4% 1/20/15 (d) | | 3,555,000 | | 3,652,514 |
6.4% 1/20/40 (d) | | 2,095,000 | | 2,225,665 |
TOTAL QATAR | | 5,878,179 |
Russia - 6.7% |
Russian Federation: | | | | |
3.625% 4/29/15 (d) | | 8,700,000 | | 8,428,560 |
7.5% 3/31/30 (Reg. S) | | 31,960,800 | | 36,075,735 |
12.75% 6/24/28 (Reg. S) | | 4,974,000 | | 8,331,450 |
TOTAL RUSSIA | | 52,835,745 |
Serbia - 0.6% |
Republic of Serbia 6.75% 11/1/24 (d) | | 5,147,500 | | 4,928,731 |
South Africa - 0.2% |
South African Republic 5.5% 3/9/20 | | 1,810,000 | | 1,871,088 |
Sri Lanka - 0.7% |
Democratic Socialist Republic of Sri Lanka: | | | | |
7.4% 1/22/15 (d) | | 3,195,000 | | 3,282,863 |
8.25% 10/24/12 (d) | | 1,850,000 | | 1,970,250 |
TOTAL SRI LANKA | | 5,253,113 |
Turkey - 6.8% |
Turkish Republic: | | | | |
0% 11/16/11 | TRY | 6,930,000 | | 3,895,978 |
5.625% 3/30/21 | | 3,295,000 | | 3,253,813 |
6.75% 4/3/18 | | 1,615,000 | | 1,768,425 |
6.75% 5/30/40 | | 5,100,000 | | 5,115,300 |
6.875% 3/17/36 | | 6,700,000 | | 6,917,750 |
7% 9/26/16 | | 1,225,000 | | 1,364,405 |
7% 3/11/19 | | 4,045,000 | | 4,479,838 |
7% 6/5/20 | | 1,565,000 | | 1,727,447 |
7.25% 3/15/15 | | 1,195,000 | | 1,335,413 |
Government Obligations - continued |
| Principal Amount (b) | | Value |
Turkey - continued |
Turkish Republic: - continued | | | | |
7.25% 3/5/38 | | $ 1,815,000 | | $ 1,946,588 |
7.375% 2/5/25 | | 4,620,000 | | 5,191,956 |
7.5% 7/14/17 | | 1,735,000 | | 1,977,900 |
7.5% 11/7/19 | | 1,460,000 | | 1,673,598 |
9.5% 1/15/14 | | 2,675,000 | | 3,143,125 |
11% 1/14/13 | | 2,325,000 | | 2,726,063 |
11.875% 1/15/30 | | 4,305,000 | | 6,958,172 |
TOTAL TURKEY | | 53,475,771 |
Ukraine - 0.9% |
Ukraine Cabinet of Ministers: | | | | |
6.58% 11/21/16 (d) | | 2,095,000 | | 1,943,113 |
6.875% 3/4/11 (Reg. S) | | 1,445,000 | | 1,445,000 |
Ukraine Government: | | | | |
6.385% 6/26/12 (d) | | 845,000 | | 836,550 |
6.75% 11/14/17 (d) | | 1,830,000 | | 1,697,325 |
7.65% 6/11/13 (Reg. S) | | 1,400,000 | | 1,417,500 |
TOTAL UKRAINE | | 7,339,488 |
United States of America - 4.5% |
U.S. Treasury Bonds 4.375% 5/15/40 | | 32,630,000 | | 35,378,099 |
Uruguay - 0.4% |
Uruguay Republic 8% 11/18/22 | | 2,420,000 | | 2,916,100 |
Venezuela - 3.5% |
Venezuelan Republic: | | | | |
oil recovery rights 4/15/20 (g) | | 15,490 | | 387,250 |
1.3072% 4/20/11 (Reg. S) (e) | | 8,360,000 | | 7,733,000 |
5.375% 8/7/10 (Reg. S) | | 1,535,000 | | 1,523,488 |
5.75% 2/26/16 (Reg S.) | | 3,010,000 | | 1,896,300 |
7% 3/31/38 | | 1,345,000 | | 706,125 |
7.75% 10/13/19 (Reg. S) | | 5,005,000 | | 3,003,000 |
8.5% 10/8/14 | | 2,495,000 | | 1,946,100 |
9.25% 9/15/27 | | 3,960,000 | | 2,722,500 |
9.25% 5/7/28 (Reg. S) | | 2,025,000 | | 1,235,250 |
9.375% 1/13/34 | | 2,080,000 | | 1,300,000 |
10.75% 9/19/13 | | 4,445,000 | | 3,911,600 |
13.625% 8/15/18 | | 1,255,000 | | 1,098,125 |
TOTAL VENEZUELA | | 27,462,738 |
Government Obligations - continued |
| Principal Amount (b) | | Value |
Vietnam - 0.7% |
Vietnamese Socialist Republic: | | | | |
6.75% 1/29/20 (d) | | $ 3,720,000 | | $ 3,831,600 |
6.875% 1/15/16 (d) | | 1,445,000 | | 1,535,313 |
TOTAL VIETNAM | | 5,366,913 |
TOTAL GOVERNMENT OBLIGATIONS (Cost $483,932,563) | 508,274,627 |
Supranational Obligations - 0.6% |
|
Central American Bank 5.375% 9/24/14 (d) | | 1,770,000 | | 1,871,775 |
Corporacion Andina de Fomento 8.125% 6/4/19 | | 1,610,000 | | 1,974,021 |
Eurasian Development Bank 7.375% 9/29/14 (d) | | 980,000 | | 1,016,750 |
TOTAL SUPRANATIONAL OBLIGATIONS (Cost $4,462,196) | 4,862,546 |
Investment Companies - 1.3% |
| Shares | | |
United States of America - 1.3% |
iShares MSCI Brazil Index ETF
(Cost $10,661,583) | 164,800 | | 10,211,008 |
Preferred Securities - 0.9% |
| Principal Amount (b) | | |
Brazil - 0.2% |
Globo Comunicacoes e Participacoes SA 9.375% | $ 1,805,000 | | 1,838,007 |
United States of America - 0.7% |
Pemex Project Funding Master Trust 7.75% | 5,060,000 | | 5,082,371 |
TOTAL PREFERRED SECURITIES (Cost $6,926,026) | 6,920,378 |
Money Market Funds - 8.0% |
| Shares | | Value |
Fidelity Cash Central Fund, 0.20% (f)
(Cost $63,026,038) | 63,026,038 | | $ 63,026,038 |
TOTAL INVESTMENT PORTFOLIO - 98.1% (Cost $743,037,066) | | 771,676,138 |
NET OTHER ASSETS (LIABILITIES) - 1.9% | | 15,189,083 |
NET ASSETS - 100% | $ 786,865,221 |
Security Type Abbreviations |
ETF | - | Exchange-Traded Fund |
Currency Abbreviations |
BRL | - | Brazilian real |
EUR | - | European Monetary Unit |
GHS | - | Ghana cedi |
TRY | - | New Turkish Lira |
Legend |
(a) Non-income producing - Issuer is in default. |
(b) Principal amount is stated in United States dollars unless otherwise noted. |
(c) Security initially issued at one coupon which converts to a higher coupon at a specified date. The rate shown is the rate at period end. |
(d) 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 end of the period, the value of these securities amounted to $258,299,745 or 32.8% of net assets. |
(e) The coupon rate shown on floating or adjustable rate securities represents the rate at period end. |
(f) 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. |
(g) Quantity represents share amount. |
Affiliated Central Funds |
Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows: |
Fund | Income earned |
Fidelity Cash Central Fund | $ 39,709 |
Fidelity Securities Lending Cash Central Fund | 7 |
Total | $ 39,716 |
Other Information |
The following is a summary of the inputs used, as of June 30, 2010, involving the Fund's assets and liabilities carried at value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the tables below, please refer to the Security Valuation section in the accompanying Notes to Financial Statements. |
Valuation Inputs at Reporting Date: |
Description | Total | Level 1 | Level 2 | Level 3 |
Investments in Securities: | | | | |
Corporate Bonds | $ 178,381,541 | $ - | $ 178,308,173 | $ 73,368 |
Government Obligations | 508,274,627 | - | 508,274,627 | - |
Supranational Obligations | 4,862,546 | - | 4,862,546 | - |
Investment Companies | 10,211,008 | 10,211,008 | - | - |
Preferred Securities | 6,920,378 | - | 6,920,378 | - |
Money Market Funds | 63,026,038 | 63,026,038 | - | - |
Total Investments in Securities: | $ 771,676,138 | $ 73,237,046 | $ 698,365,724 | $ 73,368 |
The following is a reconciliation of Investments in Securities for which Level 3 inputs were used in determining value: |
Investments in Securities: | |
Beginning Balance | $ 563,258 |
Total Realized Gain (Loss) | - |
Total Unrealized Gain (Loss) | 56,188 |
Cost of Purchases | - |
Proceeds of Sales | - |
Amortization/Accretion | - |
Transfers in to Level 3 | 17,180 |
Transfers out of Level 3 | (563,258) |
Ending Balance | $ 73,368 |
The change in unrealized gain (loss) for the period attributable to Level 3 securities held at June 30, 2010 | $ 56,188 |
The information used in the above reconciliation represents fiscal year to date activity for any Investments in Securities identified as using Level 3 inputs at either the beginning or the end of the current fiscal period. Transfers in or out of Level 3 represent the beginning value of any Security or Instrument where a change in the pricing level occurred from the beginning to the end of the period. The cost of purchases and the proceeds of sales may include securities received or delivered through corporate actions or exchanges. Realized and unrealized gains (losses) disclosed in the reconciliation are included in Net Gain (Loss) on the Fund's Statement of Operations. |
Other Information - continued |
The composition of credit quality ratings as a percentage of net assets is as follows (ratings are unaudited): |
U.S. Government and U.S. Government Agency Obligations | 4.5% |
AAA,AA,A | 5.9% |
BBB | 27.9% |
BB | 29.2% |
B | 16.0% |
CCC,CC,C | 0.4% |
Not Rated | 4.8% |
Equities | 1.4% |
Short-Term Investments
and Net Other Assets | 9.9% |
| 100.0% |
We have used ratings from Moody's Investors Service, Inc. Where Moody's ratings are not available, we have used S&P ratings. All ratings are as of the report date and do not reflect subsequent downgrades. |
Income Tax Information |
At December 31, 2009, the Fund had a capital loss carryforward of approximately $3,380,295 all of which will expire on December 31, 2016. Capital loss carryforwards are only available to offset future capital gains of the Fund to the extent provided by regulations and may be limited. |
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Statement of Assets and Liabilities
| June 30, 2010 (Unaudited) |
| | |
Assets | | |
Investment in securities, at value - See accompanying schedule: Unaffiliated issuers (cost $680,011,028) | $ 708,650,100 | |
Fidelity Central Funds (cost $63,026,038) | 63,026,038 | |
Total Investments (cost $743,037,066) | | $ 771,676,138 |
Cash | | 818,469 |
Receivable for investments sold | | 5,215,395 |
Receivable for fund shares sold | | 3,665,272 |
Dividends receivable | | 120,000 |
Interest receivable | | 13,442,523 |
Distributions receivable from Fidelity Central Funds | | 11,811 |
Receivable from investment adviser for expense reductions | | 24,262 |
Other receivables | | 327 |
Total assets | | 794,974,197 |
| | |
Liabilities | | |
Payable for investments purchased | $ 5,363,305 | |
Payable for fund shares redeemed | 1,000,359 | |
Distributions payable | 944,374 | |
Accrued management fee | 422,461 | |
Distribution fees payable | 154,546 | |
Other affiliated payables | 149,188 | |
Other payables and accrued expenses | 74,743 | |
Total liabilities | | 8,108,976 |
| | |
Net Assets | | $ 786,865,221 |
Net Assets consist of: | | |
Paid in capital | | $ 761,405,179 |
Undistributed net investment income | | 5,114,398 |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | | (8,295,959) |
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies | | 28,641,603 |
Net Assets | | $ 786,865,221 |
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Statements - continued
Statement of Assets and Liabilities - continued
| June 30, 2010 (Unaudited) |
| | |
Calculation of Maximum Offering Price Class A:
Net Asset Value and redemption price per share ($229,235,669 ÷ 17,698,870 shares) | | $ 12.95 |
| | |
Maximum offering price per share (100/96.00 of $12.95) | | $ 13.49 |
Class T:
Net Asset Value and redemption price per share ($115,016,893 ÷ 8,910,697 shares) | | $ 12.91 |
| | |
Maximum offering price per share (100/96.00 of $12.91) | | $ 13.45 |
Class B:
Net Asset Value and offering price per share ($20,209,125 ÷ 1,545,304 shares)A | | $ 13.08 |
| | |
Class C:
Net Asset Value and offering price per share ($86,743,705 ÷ 6,658,960 shares)A | | $ 13.03 |
| | |
Institutional Class:
Net Asset Value, offering price and redemption price per share ($335,659,829 ÷ 26,311,156 shares) | | $ 12.76 |
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
Six months ended June 30, 2010 (Unaudited) |
| | |
Investment Income | | |
Dividends | | $ 481,531 |
Interest | | 23,170,398 |
Income from Fidelity Central Funds | | 39,716 |
Total income | | 23,691,645 |
| | |
Expenses | | |
Management fee | $ 2,258,642 | |
Transfer agent fees | 669,175 | |
Distribution fees | 854,866 | |
Accounting and security lending fees | 166,458 | |
Custodian fees and expenses | 56,695 | |
Independent trustees' compensation | 1,756 | |
Registration fees | 116,837 | |
Audit | 31,537 | |
Legal | 481 | |
Miscellaneous | 3,497 | |
Total expenses before reductions | 4,159,944 | |
Expense reductions | (127,755) | 4,032,189 |
Net investment income | | 19,659,456 |
Realized and Unrealized Gain (Loss) Net realized gain (loss) on: | | |
Investment securities: | | |
Unaffiliated issuers | (84,092) | |
Foreign currency transactions | (112,150) | |
Total net realized gain (loss) | | (196,242) |
Change in net unrealized appreciation (depreciation) on: Investment securities | 5,076,948 | |
Assets and liabilities in foreign currencies | 5,913 | |
Total change in net unrealized appreciation (depreciation) | | 5,082,861 |
Net gain (loss) | | 4,886,619 |
Net increase (decrease) in net assets resulting from operations | | $ 24,546,075 |
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Statements - continued
Statement of Changes in Net Assets
| Six months ended
June 30, 2010
(Unaudited) | Year ended
December 31,
2009 |
Increase (Decrease) in Net Assets | | |
Operations | | |
Net investment income | $ 19,659,456 | $ 27,410,345 |
Net realized gain (loss) | (196,242) | 4,190,926 |
Change in net unrealized appreciation (depreciation) | 5,082,861 | 74,936,989 |
Net increase (decrease) in net assets resulting
from operations | 24,546,075 | 106,538,260 |
Distributions to shareholders from net investment income | (17,202,759) | (24,963,530) |
Distributions to shareholders from net realized gain | - | (647,094) |
Total distributions | (17,202,759) | (25,610,624) |
Share transactions - net increase (decrease) | 218,969,056 | 261,650,696 |
Redemption fees | 181,313 | 87,851 |
Total increase (decrease) in net assets | 226,493,685 | 342,666,183 |
| | |
Net Assets | | |
Beginning of period | 560,371,536 | 217,705,353 |
End of period (including undistributed net investment income of $5,114,398 and undistributed net investment income of $2,657,701, respectively) | $ 786,865,221 | $ 560,371,536 |
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights - Class A
| Six months ended
June 30, 2010 | Years ended December 31, |
| (Unaudited) | 2009 | 2008 | 2007 | 2006 | 2005 |
Selected Per-Share Data | | | | | |
Net asset value, beginning of period | $ 12.76 | $ 9.51 | $ 12.32 | $ 12.40 | $ 12.11 | $ 12.16 |
Income from Investment Operations | | | | | | |
Net investment income E | .374 | .950 | .675 | .709 | .715 | .727 |
Net realized and unrealized gain (loss) | .141 | 3.126 | (2.793) | (.066) | .638 | .556 |
Total from investment operations | .515 | 4.076 | (2.118) | .643 | 1.353 | 1.283 |
Distributions from net investment income | (.328) | (.814) | (.664) | (.705) | (.699) | (.744) |
Distributions from net realized gain | - | (.015) | (.030) | (.020) | (.367) | (.590) |
Total distributions | (.328) | (.829) | (.694) | (.725) | (1.066) | (1.334) |
Redemption fees added to paid in capital E | .003 | .003 | .002 | .002 | .003 | .001 |
Net asset value, end of period | $ 12.95 | $ 12.76 | $ 9.51 | $ 12.32 | $ 12.40 | $ 12.11 |
Total Return B, C, D | 4.09% | 44.11% | (17.82)% | 5.36% | 11.57% | 11.15% |
Ratios to Average Net Assets F, H | | | | | |
Expenses before reductions | 1.27% A | 1.29% | 1.32% | 1.27% | 1.28% | 1.31% |
Expenses net of fee waivers, if any | 1.20% A | 1.20% | 1.20% | 1.18% | 1.10% | 1.11% |
Expenses net of all reductions | 1.20% A | 1.20% | 1.20% | 1.17% | 1.09% | 1.11% |
Net investment income | 5.85% A | 8.13% | 5.94% | 5.75% | 5.80% | 6.04% |
Supplemental Data | | | | | | |
Net assets, end of period (000 omitted) | $ 229,236 | $ 167,196 | $ 60,543 | $ 75,584 | $ 65,593 | $ 42,836 |
Portfolio turnover rate G | 105% A | 123% | 57% | 72% | 105% | 202% |
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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
H 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 reductions from other expense offset arrangements and do not represent the amount paid by the class 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 class.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights - Class T
| Six months ended
June 30, 2010 | Years ended December 31, |
| (Unaudited) | 2009 | 2008 | 2007 | 2006 | 2005 |
Selected Per-Share Data | | | | | | |
Net asset value, beginning of period | $ 12.71 | $ 9.48 | $ 12.28 | $ 12.37 | $ 12.08 | $ 12.14 |
Income from Investment Operations | | | | | | |
Net investment income E | .373 | .924 | .676 | .704 | .701 | .713 |
Net realized and unrealized gain (loss) | .152 | 3.132 | (2.784) | (.074) | .640 | .549 |
Total from investment operations | .525 | 4.056 | (2.108) | .630 | 1.341 | 1.262 |
Distributions from net investment income | (.328) | (.814) | (.664) | (.702) | (.687) | (.733) |
Distributions from net realized gain | - | (.015) | (.030) | (.020) | (.367) | (.590) |
Total distributions | (.328) | (.829) | (.694) | (.722) | (1.054) | (1.323) |
Redemption fees added to paid in capital E | .003 | .003 | .002 | .002 | .003 | .001 |
Net asset value, end of period | $ 12.91 | $ 12.71 | $ 9.48 | $ 12.28 | $ 12.37 | $ 12.08 |
Total Return B, C, D | 4.18% | 44.04% | (17.80)% | 5.26% | 11.49% | 10.98% |
Ratios to Average Net Assets F, H | | | | | |
Expenses before reductions | 1.26% A | 1.30% | 1.32% | 1.29% | 1.36% | 1.40% |
Expenses net of fee waivers, if any | 1.20% A | 1.20% | 1.20% | 1.20% | 1.20% | 1.21% |
Expenses net of all reductions | 1.20% A | 1.20% | 1.20% | 1.19% | 1.19% | 1.21% |
Net investment income | 5.85% A | 8.13% | 5.95% | 5.73% | 5.70% | 5.94% |
Supplemental Data | | | | | | |
Net assets, end of period (000 omitted) | $ 115,017 | $ 106,446 | $ 87,427 | $ 136,031 | $ 137,200 | $ 95,102 |
Portfolio turnover rate G | 105% A | 123% | 57% | 72% | 105% | 202% |
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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
H 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 reductions from other expense offset arrangements and do not represent the amount paid by the class 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 class.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights - Class B
| Six months ended
June 30, 2010 | Years ended December 31, |
| (Unaudited) | 2009 | 2008 | 2007 | 2006 | 2005 |
Selected Per-Share Data | | | | | | |
Net asset value, beginning of period | $ 12.88 | $ 9.60 | $ 12.42 | $ 12.50 | $ 12.20 | $ 12.24 |
Income from Investment Operations | | | | | | |
Net investment income E | .336 | .861 | .609 | .632 | .628 | .640 |
Net realized and unrealized gain (loss) | .146 | 3.169 | (2.812) | (.073) | .642 | .562 |
Total from investment operations | .482 | 4.030 | (2.203) | .559 | 1.270 | 1.202 |
Distributions from net investment income | (.285) | (.738) | (.589) | (.621) | (.606) | (.653) |
Distributions from net realized gain | - | (.015) | (.030) | (.020) | (.367) | (.590) |
Total distributions | (.285) | (.753) | (.619) | (.641) | (.973) | (1.243) |
Redemption fees added to paid in capital E | .003 | .003 | .002 | .002 | .003 | .001 |
Net asset value, end of period | $ 13.08 | $ 12.88 | $ 9.60 | $ 12.42 | $ 12.50 | $ 12.20 |
Total Return B, C, D | 3.79% | 43.08% | (18.29)% | 4.61% | 10.74% | 10.34% |
Ratios to Average Net Assets F, H | | | | | |
Expenses before reductions | 1.96% A | 1.97% | 1.97% | 1.94% | 2.10% | 2.12% |
Expenses net of fee waivers, if any | 1.85% A | 1.85% | 1.85% | 1.85% | 1.85% | 1.86% |
Expenses net of all reductions | 1.85% A | 1.85% | 1.85% | 1.84% | 1.84% | 1.86% |
Net investment income | 5.20% A | 7.48% | 5.30% | 5.08% | 5.06% | 5.28% |
Supplemental Data | | | | | | |
Net assets, end of period (000 omitted) | $ 20,209 | $ 18,398 | $ 14,324 | $ 22,418 | $ 26,442 | $ 27,303 |
Portfolio turnover rate G | 105% A | 123% | 57% | 72% | 105% | 202% |
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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
H 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 reductions from other expense offset arrangements and do not represent the amount paid by the class 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 class.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights - Class C
| Six months ended
June 30, 2010 | Years ended December 31, |
| (Unaudited) | 2009 | 2008 | 2007 | 2006 | 2005 |
Selected Per-Share Data | | | | | | |
Net asset value, beginning of period | $ 12.83 | $ 9.56 | $ 12.37 | $ 12.46 | $ 12.16 | $ 12.21 |
Income from Investment Operations | | | | | | |
Net investment income E | .328 | .867 | .594 | .616 | .613 | .627 |
Net realized and unrealized gain (loss) | .148 | 3.142 | (2.798) | (.080) | .645 | .553 |
Total from investment operations | .476 | 4.009 | (2.204) | .536 | 1.258 | 1.180 |
Distributions from net investment income | (.279) | (.727) | (.578) | (.608) | (.594) | (.641) |
Distributions from net realized gain | - | (.015) | (.030) | (.020) | (.367) | (.590) |
Total distributions | (.279) | (.742) | (.608) | (.628) | (.961) | (1.231) |
Redemption fees added to paid in capital E | .003 | .003 | .002 | .002 | .003 | .001 |
Net asset value, end of period | $ 13.03 | $ 12.83 | $ 9.56 | $ 12.37 | $ 12.46 | $ 12.16 |
Total Return B, C, D | 3.76% | 43.02% | (18.37)% | 4.44% | 10.66% | 10.17% |
Ratios to Average Net Assets F, H | | | | | |
Expenses before reductions | 2.00% A | 2.02% | 2.06% | 2.04% | 2.12% | 2.16% |
Expenses net of fee waivers, if any | 1.95% A | 1.95% | 1.95% | 1.95% | 1.95% | 1.96% |
Expenses net of all reductions | 1.95% A | 1.95% | 1.95% | 1.94% | 1.94% | 1.96% |
Net investment income | 5.09% A | 7.38% | 5.20% | 4.98% | 4.95% | 5.19% |
Supplemental Data | | | | | | |
Net assets, end of period (000 omitted) | $ 86,744 | $ 63,669 | $ 22,464 | $ 30,962 | $ 28,628 | $ 18,863 |
Portfolio turnover rate G | 105% A | 123% | 57% | 72% | 105% | 202% |
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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
H 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 reductions from other expense offset arrangements and do not represent the amount paid by the class 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 class.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights - Institutional Class
| Six months ended
June 30, 2010 | Years ended December 31, |
| (Unaudited) | 2009 | 2008 | 2007 | 2006 | 2005 |
Selected Per-Share Data | | | | | |
Net asset value, beginning of period | $ 12.57 | $ 9.39 | $ 12.16 | $ 12.25 | $ 11.98 | $ 12.04 |
Income from Investment Operations | | | | | | |
Net investment income D | .384 | .990 | .695 | .725 | .725 | .739 |
Net realized and unrealized gain (loss) | .147 | 3.044 | (2.745) | (.064) | .628 | .554 |
Total from investment operations | .531 | 4.034 | (2.050) | .661 | 1.353 | 1.293 |
Distributions from net investment income | (.344) | (.842) | (.692) | (.733) | (.718) | (.764) |
Distributions from net realized gain | - | (.015) | (.030) | (.020) | (.367) | (.590) |
Total distributions | (.344) | (.857) | (.722) | (.753) | (1.085) | (1.354) |
Redemption fees added to paid in capital D | .003 | .003 | .002 | .002 | .002 | .001 |
Net asset value, end of period | $ 12.76 | $ 12.57 | $ 9.39 | $ 12.16 | $ 12.25 | $ 11.98 |
Total Return B, C | 4.29% | 44.29% | (17.52)% | 5.58% | 11.70% | 11.37% |
Ratios to Average Net Assets E,G | | | | | |
Expenses before reductions | .94% A | .97% | 1.02% | .99% | 1.02% | 1.01% |
Expenses net of fee waivers, if any | .94% A | .95% | .95% | .95% | .95% | .95% |
Expenses net of all reductions | .94% A | .95% | .95% | .95% | .94% | .95% |
Net investment income | 6.10% A | 8.38% | 6.19% | 5.97% | 5.96% | 6.20% |
Supplemental Data | | | | | | |
Net assets, end of period (000 omitted) | $ 335,660 | $ 204,663 | $ 32,947 | $ 45,232 | $ 25,177 | $ 22,134 |
Portfolio turnover rate F | 105% A | 123% | 57% | 72% | 105% | 202% |
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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
F Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
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 reductions from other expense offset arrangements and do not represent the amount paid by the class 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 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, 2010 (Unaudited)
1. Organization.
Fidelity Advisor Emerging Markets Income Fund (the Fund) is a fund of Fidelity Advisor Series VIII (the Trust) and is authorized to issue an unlimited number of shares. The Trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. The 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. Effective after the close of business on September 1, 2010, Class B shares will be closed to new accounts and additional purchases by existing shareholders. 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.
2. Investments in Fidelity Central Funds.
The Fund may invest in Fidelity Central Funds, which are open-end investment companies available only to other investment companies and accounts managed by Fidelity Management & Research Company (FMR) and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.
The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of FMR.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) web site at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC web site or upon request.
3. Significant Accounting Policies.
The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), which require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates. The following summarizes the significant accounting policies of the Fund:
Semiannual Report
Notes to Financial Statements (Unaudited) - continued
3. Significant Accounting Policies - continued
Security Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Fund uses independent pricing services approved by the Board of Trustees to value its investments. When current market prices or quotations are not readily available or reliable, valuations may be determined in good faith in accordance with procedures adopted by the Board of Trustees. Factors used in determining value may include market or security specific events, changes in interest rates and credit quality. The frequency with which these procedures are used cannot be predicted and they may be utilized to a significant extent. The value used for net asset value (NAV) calculation under these procedures may differ from published prices for the same securities.
The Fund categorizes the inputs to valuation techniques used to value its investments into a disclosure hierarchy consisting of three levels as shown below.
Level 1 - quoted prices in active markets for identical investments
Level 2 - other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, etc.)
Level 3 - unobservable inputs (including the fund's own assumptions based on the best information available)
Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. The aggregate value of investments by input level, as of June 30, 2010, for the Fund's investments, as well as a roll forward of Level 3 securities, is included at the end of the Fund's Schedule of Investments. Valuation techniques used to value the Fund's investments by major category are as follows.
Debt securities, including restricted securities, are valued based on evaluated prices received from independent pricing services or from dealers who make markets in such securities. For corporate bonds, foreign government and government agency obligations, preferred securities, supranational obligations, and U.S. government and government agency obligations, pricing services utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type as well as dealer supplied prices and are generally categorized as Level 2 in the hierarchy. 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 and are categorized as Level 2 in the hierarchy. The Fund invests a significant portion of its assets in below investment grade securities. The value of these securities can be more volatile due to changes in the credit quality of the issuer and is sensitive to changes in economic, market and regulatory conditions.
Semiannual Report
3. Significant Accounting Policies - continued
Security Valuation - continued
When independent prices are unavailable or unreliable, debt securities may be valued utilizing pricing matrices which consider similar factors that would be used by independent pricing services. These are generally categorized as Level 2 in the hierarchy but may be Level 3 depending on the circumstances.
Exchange-traded funds (ETFs) are valued at their last sale price or official closing price as reported by an independent pricing service on the primary market or exchange on which they are traded and are categorized as Level 1 in the hierarchy. In the event there were no sales during the day but the exchange reports a closing bid level, ETFs are valued at the closing bid and would be categorized as Level 1 in the hierarchy. In the event there was no closing bid, ETFs may be valued by another method that the Board of Trustees believes reflects fair value in accordance with the Board's fair value pricing policies and may be categorized as Level 2 in the hierarchy.
Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value each business day and are categorized as Level 1 in the hierarchy.
Foreign Currency. The Fund uses foreign currency contracts to facilitate transactions in foreign-denominated securities. Gains and 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. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. 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
Semiannual Report
Notes to Financial Statements (Unaudited) - continued
3. Significant Accounting Policies - continued
Investment Transactions and Income - continued
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. Interest income and distributions from the Fidelity 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. Debt obligations may be placed on non-accrual status and related interest income may be reduced by ceasing current accruals and writing off interest receivables when the collection of all or a portion of interest has become doubtful based on consistently applied procedures. A debt obligation is removed from non-accrual status when the issuer resumes interest payments or when collectability of interest is reasonably assured.
Expenses. Most expenses of the Trust can be directly attributed to a fund. Expenses which cannot be directly attributed are apportioned amongst each fund in the Trust. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company by distributing substantially all of its taxable income and realized gains under Subchapter M of the Internal Revenue Code and filing its U.S. federal tax return. As a result, no provision for income taxes is required. A fund's federal tax return is subject to examination by the Internal Revenue Service (IRS) for a period of three years. 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.
Dividends are declared daily and paid monthly from net investment income. Distributions from realized gains, if any, 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 GAAP.
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, defaulted bonds, market discount, deferred trustees compensation, capital loss carryforwards and losses deferred due to wash sales and excise tax regulations.
Semiannual Report
3. Significant Accounting Policies - continued
Income Tax Information and Distributions to Shareholders - continued
The federal tax cost of investment securities and unrealized appreciation (depreciation) as of period end were as follows:
Gross unrealized appreciation | $ 39,700,967 |
Gross unrealized depreciation | (8,789,262) |
Net unrealized appreciation (depreciation) | $ 30,911,705 |
| |
Tax cost | $ 740,764,433 |
Short-Term Trading (Redemption) Fees. Shares held in the Fund less than 90 days are subject to a redemption fee equal to 1.00% of the proceeds of the redeemed shares. All redemption fees, including any estimated redemption fees paid by FMR, are retained by the Fund and accounted for as an addition to paid in capital.
4. Operating Policies.
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.
5. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities and U.S. government securities, aggregated $414,441,286 and $242,595,494, respectively.
6. 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 .55% of the Fund's average net assets and a group fee rate that averaged .12% 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 .67% of the Fund's average net assets.
Semiannual Report
Notes to Financial Statements (Unaudited) - continued
6. Fees and Other Transactions with Affiliates - continued
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 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 | -% | .25% | $ 254,878 | $ 3,440 |
Class T | -% | .25% | 141,667 | - |
Class B | .65% | .25% | 88,341 | 66,256 |
Class C | .75% | .25% | 369,980 | 183,868 |
| | | $ 854,866 | $ 253,564 |
Sales Load. FDC receives a front-end sales charge of up to 4.00% for selling Class A shares and 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, ..75% to .50% for certain purchases of Class A shares 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 | $ 33,002 |
Class T | 8,480 |
Class B* | 22,019 |
Class C* | 16,450 |
| $ 79,951 |
* 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.
Semiannual Report
6. Fees and Other Transactions with Affiliates - continued
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 shareholder reports, except proxy statements. For the period, the total transfer agent fees paid by each class were as follows:
| Amount | % of
Average
Net Assets* |
Class A | $ 231,472 | .23 |
Class T | 126,137 | .22 |
Class B | 25,649 | .26 |
Class C | 74,899 | .20 |
Institutional Class | 211,018 | .16 |
| $ 669,175 | |
* 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.
7. Committed Line of Credit.
The Fund participates with other funds managed by FMR in a $3.75 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 amounted to $1,123 and is reflected in Miscellaneous expenses on the Statement of Operations. During the period, there were no borrowings on this line of credit.
8. 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
Semiannual Report
Notes to Financial Statements (Unaudited) - continued
8. Security Lending - continued
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. At period end, there were no security loans outstanding. 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 Fidelity Central Funds. Net income from lending portfolio securities during the period amounted to $7.
9. Expense Reductions.
FMR voluntarily agreed to reimburse each class to the extent annual operating expenses exceeded certain levels of average net assets as noted in the table below. Some expenses, for example interest expense, including commitment fees, are excluded from this reimbursement.
The following classes were in reimbursement during the period:
| Expense
Limitations | Reimbursement
from adviser |
| | |
Class A | 1.20% | $ 65,024 |
Class T | 1.20% | 35,290 |
Class B | 1.85% | 10,327 |
Class C | 1.95% | 16,238 |
| | $ 126,879 |
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 $570 for the period. In addition, through arrangements with the Fund's custodian, 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 expenses by $306.
Semiannual Report
10. Distributions to Shareholders.
Distributions to shareholders of each class were as follows:
| Six months ended
June 30,
2010 | Year ended
December 31,
2009 |
From net investment income | | |
Class A | $ 5,139,826 | $ 7,132,338 |
Class T | 2,882,182 | 6,958,625 |
Class B | 428,077 | 1,003,714 |
Class C | 1,575,080 | 2,468,243 |
Institutional Class | 7,177,594 | 7,400,610 |
Total | $ 17,202,759 | $ 24,963,530 |
From net realized gain | | |
Class A | $ - | $ 193,016 |
Class T | - | 123,558 |
Class B | - | 21,170 |
Class C | - | 72,723 |
Institutional Class | - | 236,627 |
Total | $ - | $ 647,094 |
11. Share Transactions.
Transactions for each class of shares were as follows:
| Shares | Dollars |
| Six months ended
June 30,
2010 | Year ended
December 31,
2009 | Six months ended
June 30,
2010 | Year ended
December 31,
2009 |
Class A | | | | |
Shares sold | 7,435,480 | 8,915,226 | $ 96,435,397 | $ 108,963,057 |
Reinvestment of distributions | 339,385 | 540,320 | 4,391,443 | 6,421,068 |
Shares redeemed | (3,182,511) | (2,712,377) | (41,058,354) | (30,467,236) |
Net increase (decrease) | 4,592,354 | 6,743,169 | $ 59,768,486 | $ 84,916,889 |
Class T | | | | |
Shares sold | 1,484,168 | 2,295,615 | $ 19,163,046 | $ 26,938,453 |
Reinvestment of distributions | 192,544 | 535,436 | 2,481,771 | 6,153,825 |
Shares redeemed | (1,138,330) | (3,676,469) | (14,661,279) | (42,208,743) |
Net increase (decrease) | 538,382 | (845,418) | $ 6,983,538 | $ (9,116,465) |
Semiannual Report
Notes to Financial Statements (Unaudited) - continued
11. Share Transactions - continued
Transactions for each class of shares were as follows: - continued
| Shares | Dollars |
| Six months ended
June 30,
2010 | Year ended
December 31,
2009 | Six months ended
June 30,
2010 | Year ended
December 31,
2009 |
Class B | | | | |
Shares sold | 399,625 | 399,800 | $ 5,248,292 | $ 4,901,028 |
Reinvestment of distributions | 26,346 | 72,990 | 343,929 | 851,775 |
Shares redeemed | (309,412) | (536,535) | (4,042,175) | (5,974,173) |
Net increase (decrease) | 116,559 | (63,745) | $ 1,550,046 | $ (221,370) |
Class C | | | | |
Shares sold | 2,526,852 | 3,284,954 | $ 32,984,015 | $ 40,335,680 |
Reinvestment of distributions | 95,993 | 171,629 | 1,248,366 | 2,056,422 |
Shares redeemed | (927,132) | (842,206) | (12,009,982) | (9,820,911) |
Net increase (decrease) | 1,695,713 | 2,614,377 | $ 22,222,399 | $ 32,571,191 |
Institutional Class | | | | |
Shares sold | 13,020,386 | 14,734,937 | $ 166,413,829 | $ 176,271,975 |
Reinvestment of distributions | 292,787 | 357,732 | 3,731,373 | 4,285,454 |
Shares redeemed | (3,284,033) | (2,321,252) | (41,700,615) | (27,056,978) |
Net increase (decrease) | 10,029,140 | 12,771,417 | $ 128,444,587 | $ 153,500,451 |
12. 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.
13. Credit Risk.
The Fund's relatively large investment in countries with limited or developing capital markets may involve greater risks than investments in more developed markets and the prices of such investments may be volatile. The yields of emerging market debt obligations reflect, among other things, perceived credit risk. The consequences of political, social or economic changes in these markets may have disruptive effects on the market prices of the Fund's investments and the income they generate, as well as the Fund's ability to repatriate such amounts.
Semiannual Report
Investment Adviser
Fidelity Management & Research Company
Boston, MA
Investment Sub-Advisers
FMR Co., Inc.
Fidelity Management &
Research (U.K.) Inc.
Fidelity Research & Analysis Company
FIL Investments (Japan) Limited
FIL Investment Advisors
FIL Investment Advisors (U.K.) Ltd.
Fidelity Management & Research
(Hong Kong) Limited
Fidelity Management & Research
(Japan) Inc.
General Distributor
Fidelity Distributors Corporation
Boston, MA
Transfer and Service Agents
Fidelity Investments Institutional Operations Company, Inc.
Boston, MA
Fidelity Service Company, Inc.
Boston, MA
Custodian
JPMorgan Chase Bank
New York, NY
EMII-USAN-0810
1.787774.107
Item 2. Code of Ethics
Not applicable.
Item 3. Audit Committee Financial Expert
Not applicable.
Item 4. Principal Accountant Fees and Services
Not applicable.
Item 5. Audit Committee of Listed Registrants
Not applicable.
Item 6. Investments
(a) Not applicable.
(b) Not applicable
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 Advisor Series VIII'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 Advisor Series VIII'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 Advisor Series VIII
By: | /s/ Kenneth B. Robins |
| Kenneth B. Robins |
| President and Treasurer |
| |
Date: | September 2, 2010 |
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/ Kenneth B. Robins |
| Kenneth B. Robins |
| President and Treasurer |
| |
Date: | September 2, 2010 |
By: | /s/ Christine Reynolds |
| Christine Reynolds |
| Chief Financial Officer |
| |
Date: | September 2, 2010 |
