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 811-5251
Fidelity Concord Street Trust
(Exact name of registrant as specified in charter)
245 Summer St., Boston, MA 02210
(Address of principal executive offices) (Zip code)
Marc Bryant, Secretary
245 Summer St.
Boston, Massachusetts 02210
(Name and address of agent for service)
Registrant's telephone number, including area code:
617-563-7000
Date of fiscal year end: | April 30 |
Date of reporting period: | October 31, 2016 |
Item 1.
Reports to Stockholders
Fidelity Advisor® Event Driven Opportunities Fund Semi-Annual Report October 31, 2016 |
Contents
Board Approval of Investment Advisory Contracts and Management Fees |
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. © 2016 FMR LLC. All rights reserved.
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, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Fund nor Fidelity Distributors Corporation is a bank.
Investment Summary (Unaudited)
Top Ten Stocks as of October 31, 2016
% of fund's net assets | % of fund's net assets 6 months ago | |
Exterran Corp. | 10.1 | 3.2 |
Universal Corp. | 4.7 | 10.3 |
The Brink's Co. | 4.4 | 2.6 |
The Madison Square Garden Co. | 4.2 | 2.9 |
TopBuild Corp. | 4.2 | 3.0 |
Alliance Data Systems Corp. | 3.4 | 0.0 |
Encore Capital Group, Inc. | 3.1 | 2.1 |
Time, Inc. | 3.0 | 3.2 |
DepoMed, Inc. | 2.7 | 2.1 |
Kimball Electronics, Inc. | 2.5 | 2.5 |
42.3 |
Top Five Market Sectors as of October 31, 2016
% of fund's net assets | % of fund's net assets 6 months ago | |
Consumer Discretionary | 23.1 | 25.0 |
Information Technology | 20.2 | 6.9 |
Financials | 14.0 | 13.4 |
Energy | 10.1 | 3.2 |
Industrials | 10.0 | 13.6 |
Prior period industry classifications reflect the categories in place as of the date indicated and have not been adjusted to reflect current industry classifications.
Asset Allocation (% of fund's net assets)
As of October 31, 2016 * | ||
Stocks and Equity Futures | 97.7% | |
Short-Term Investments and Net Other Assets (Liabilities) | 2.3% |
* Foreign investments - 5.7%
As of April 30, 2016 * | ||
Stocks and Equity Futures | 99.3% | |
Short-Term Investments and Net Other Assets (Liabilities) | 0.7% |
* Foreign investments - 2.8%
Percentages shown as 0.0% may reflect amounts less than 0.05%.
Investments October 31, 2016 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 89.7% | |||
Shares | Value | ||
CONSUMER DISCRETIONARY - 23.1% | |||
Diversified Consumer Services - 2.4% | |||
Apollo Education Group, Inc. Class A (non-vtg.) (a) | 24,500 | $215,355 | |
Household Durables - 4.2% | |||
TopBuild Corp. (a) | 12,536 | 377,710 | |
Internet & Direct Marketing Retail - 0.8% | |||
Liberty TripAdvisor Holdings, Inc. (a) | 3,200 | 71,040 | |
Leisure Products - 1.4% | |||
Vista Outdoor, Inc. (a) | 3,340 | 129,158 | |
Media - 11.6% | |||
Cable One, Inc. | 145 | 83,627 | |
Gannett Co., Inc. | 4,036 | 31,360 | |
NZME Ltd. | 150,974 | 72,334 | |
The Madison Square Garden Co. (a) | 2,284 | 377,979 | |
Time, Inc. | 21,081 | 274,053 | |
Twenty-First Century Fox, Inc. Class B | 7,757 | 204,707 | |
1,044,060 | |||
Specialty Retail - 2.7% | |||
Barnes & Noble Education, Inc. (a) | 19,651 | 182,951 | |
Signet Jewelers Ltd. | 707 | 57,451 | |
240,402 | |||
TOTAL CONSUMER DISCRETIONARY | 2,077,725 | ||
CONSUMER STAPLES - 6.9% | |||
Food & Staples Retailing - 0.6% | |||
SUPERVALU, Inc. (a) | 13,700 | 58,773 | |
Food Products - 1.6% | |||
Mondelez International, Inc. | 1,638 | 73,612 | |
SunOpta, Inc. (a) | 10,200 | 67,830 | |
141,442 | |||
Tobacco - 4.7% | |||
Universal Corp. | 7,744 | 419,725 | |
TOTAL CONSUMER STAPLES | 619,940 | ||
ENERGY - 10.1% | |||
Energy Equipment & Services - 10.1% | |||
Exterran Corp. (a) | 57,640 | 911,285 | |
FINANCIALS - 14.0% | |||
Capital Markets - 3.0% | |||
Associated Capital Group, Inc. | 3,770 | 127,992 | |
PJT Partners, Inc. | 4,940 | 136,048 | |
264,040 | |||
Consumer Finance - 3.1% | |||
Encore Capital Group, Inc. (a) | 13,914 | 276,193 | |
Diversified Financial Services - 2.8% | |||
Donnelley Financial Solutions, Inc. (a) | 6,200 | 132,990 | |
ECN Capital Corp. | 53,600 | 117,086 | |
250,076 | |||
Insurance - 2.7% | |||
Genworth Financial, Inc. Class A (a) | 27,100 | 112,194 | |
Stewart Information Services Corp. | 2,950 | 132,603 | |
244,797 | |||
Thrifts & Mortgage Finance - 2.4% | |||
Fannie Mae (a) | 64,535 | 109,710 | |
Freddie Mac (a) | 68,335 | 109,336 | |
219,046 | |||
TOTAL FINANCIALS | 1,254,152 | ||
HEALTH CARE - 3.7% | |||
Health Care Providers & Services - 0.5% | |||
Quorum Health Corp. (a) | 10,652 | 43,034 | |
Pharmaceuticals - 3.2% | |||
DepoMed, Inc. (a) | 10,900 | 243,724 | |
Valeant Pharmaceuticals International, Inc. (United States) (a) | 2,727 | 48,650 | |
292,374 | |||
TOTAL HEALTH CARE | 335,408 | ||
INDUSTRIALS - 10.0% | |||
Aerospace & Defense - 0.8% | |||
KLX, Inc. (a) | 2,010 | 69,184 | |
Commercial Services & Supplies - 4.4% | |||
The Brink's Co. | 10,123 | 400,365 | |
Electrical Equipment - 0.8% | |||
Babcock & Wilcox Enterprises, Inc. (a) | 4,643 | 73,081 | |
Machinery - 2.1% | |||
Allison Transmission Holdings, Inc. | 6,517 | 190,883 | |
Professional Services - 1.9% | |||
Insperity, Inc. | 2,239 | 168,373 | |
TOTAL INDUSTRIALS | 901,886 | ||
INFORMATION TECHNOLOGY - 20.2% | |||
Communications Equipment - 1.2% | |||
Lumentum Holdings, Inc. (a) | 3,270 | 109,872 | |
Electronic Equipment & Components - 2.5% | |||
Kimball Electronics, Inc. (a) | 16,384 | 227,738 | |
Internet Software & Services - 1.5% | |||
CommerceHub, Inc. Series A, (a) | 8,600 | 129,172 | |
IT Services - 6.5% | |||
Alliance Data Systems Corp. | 1,469 | 300,366 | |
Computer Sciences Corp. | 2,620 | 142,659 | |
PayPal Holdings, Inc. (a) | 3,300 | 137,478 | |
580,503 | |||
Semiconductors & Semiconductor Equipment - 3.0% | |||
Marvell Technology Group Ltd. | 11,240 | 146,457 | |
Versum Materials, Inc. (a) | 5,430 | 123,261 | |
269,718 | |||
Software - 3.0% | |||
CDK Global, Inc. | 2,426 | 132,484 | |
TiVo Corp. (a) | 6,950 | 137,958 | |
270,442 | |||
Technology Hardware, Storage & Peripherals - 2.5% | |||
Hewlett Packard Enterprise Co. | 6,040 | 135,719 | |
Quantum Corp. (a) | 113,574 | 90,882 | |
226,601 | |||
TOTAL INFORMATION TECHNOLOGY | 1,814,046 | ||
MATERIALS - 0.9% | |||
Containers & Packaging - 0.9% | |||
Owens-Illinois, Inc. (a) | 4,011 | 77,412 | |
REAL ESTATE - 0.8% | |||
Equity Real Estate Investment Trusts (REITs) - 0.8% | |||
Four Corners Property Trust, Inc. | 3,594 | 72,168 | |
TOTAL COMMON STOCKS | |||
(Cost $7,994,896) | 8,064,022 | ||
Principal Amount | Value | ||
U.S. Treasury Obligations - 0.3% | |||
U.S. Treasury Bills, yield at date of purchase 0.33% 12/8/16 (b) | |||
(Cost $29,990) | 30,000 | 29,995 | |
Shares | Value | ||
Money Market Funds - 7.9% | |||
Fidelity Cash Central Fund, 0.41% (c) | |||
(Cost $712,354) | 712,259 | 712,473 | |
Equity Funds - 0.9% | |||
Domestic Equity Funds - 0.9% | |||
iShares Russell 3000 Index ETF | |||
(Cost $78,899) | 645 | 80,889 | |
TOTAL INVESTMENT PORTFOLIO - 98.8% | |||
(Cost $8,816,139) | 8,887,379 | ||
NET OTHER ASSETS (LIABILITIES) - 1.2% | 105,356 | ||
NET ASSETS - 100% | $8,992,735 |
Futures Contracts | |||
Expiration Date | Underlying Face Amount at Value | Unrealized Appreciation/(Depreciation) | |
Purchased | |||
Equity Index Contracts | |||
6 CME E-mini S&P 500 Index Contracts (United States) | Dec. 2016 | 636,030 | $(11,530) |
The face value of futures purchased as a percentage of Net Assets is 7.1%
For the period, the average monthly underlying face amount at value for futures contracts in the aggregate was $648,548.
Security Type Abbreviations
ETF – Exchange-Traded Fund
Legend
(a) Non-income producing
(b) Security or a portion of the security was pledged to cover margin requirements for futures contracts. At period end, the value of securities pledged amounted to $29,995.
(c) Affiliated fund that is generally 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. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
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 | $1,656 |
Total | $1,656 |
Investment Valuation
The following is a summary of the inputs used, as of October 31, 2016, involving the Fund's assets and liabilities carried at fair 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 below, please refer to the Investment 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: | ||||
Equities: | ||||
Consumer Discretionary | $2,077,725 | $2,077,725 | $-- | $-- |
Consumer Staples | 619,940 | 619,940 | -- | -- |
Energy | 911,285 | 911,285 | -- | -- |
Financials | 1,254,152 | 1,254,152 | -- | -- |
Health Care | 335,408 | 335,408 | -- | -- |
Industrials | 901,886 | 901,886 | -- | -- |
Information Technology | 1,814,046 | 1,814,046 | -- | -- |
Materials | 77,412 | 77,412 | -- | -- |
Real Estate | 72,168 | 72,168 | -- | -- |
U.S. Government and Government Agency Obligations | 29,995 | -- | 29,995 | -- |
Money Market Funds | 712,473 | 712,473 | -- | -- |
Equity Funds | 80,889 | 80,889 | -- | -- |
Total Investments in Securities: | $8,887,379 | $8,857,384 | $29,995 | $-- |
Derivative Instruments: | ||||
Liabilities | ||||
Futures Contracts | $(11,530) | $(11,530) | $-- | $-- |
Total Liabilities | $(11,530) | $(11,530) | $-- | $-- |
Total Derivative Instruments: | $(11,530) | $(11,530) | $-- | $-- |
Value of Derivative Instruments
The following table is a summary of the Fund's value of derivative instruments by primary risk exposure as of October 31, 2016. For additional information on derivative instruments, please refer to the Derivative Instruments section in the accompanying Notes to Financial Statements.
Primary Risk Exposure / Derivative Type | Value | |
Asset | Liability | |
Equity Risk | ||
Futures Contracts(a) | $0 | $(11,530) |
Total Equity Risk | 0 | (11,530) |
Total Value of Derivatives | $0 | $(11,530) |
(a) Reflects gross cumulative appreciation (depreciation) on futures contracts as presented in the Schedule of Investments. In the Statement of Assets and Liabilities, the period end daily variation margin is included in receivable or payable for daily variation margin for derivative instruments, and the net cumulative appreciation (depreciation) is included in net unrealized appreciation (depreciation).
See accompanying notes which are an integral part of the financial statements.
Financial Statements
Statement of Assets and Liabilities
October 31, 2016 (Unaudited) | ||
Assets | ||
Investment in securities, at value — See accompanying schedule: Unaffiliated issuers (cost $8,103,785) | $8,174,906 | |
Fidelity Central Funds (cost $712,354) | 712,473 | |
Total Investments (cost $8,816,139) | $8,887,379 | |
Cash | 38,027 | |
Receivable for investments sold | 302,087 | |
Receivable for fund shares sold | 843 | |
Dividends receivable | 7,107 | |
Distributions receivable from Fidelity Central Funds | 231 | |
Prepaid expenses | 23 | |
Receivable from investment adviser for expense reductions | 2,754 | |
Other receivables | 138 | |
Total assets | 9,238,589 | |
Liabilities | ||
Payable for investments purchased | $125,502 | |
Payable for fund shares redeemed | 86,447 | |
Accrued management fee | 5,994 | |
Distribution and service plan fees payable | 1,780 | |
Payable for daily variation margin for derivative instruments | 959 | |
Audit fee payable | 22,167 | |
Other affiliated payables | 1,824 | |
Other payables and accrued expenses | 1,181 | |
Total liabilities | 245,854 | |
Net Assets | $8,992,735 | |
Net Assets consist of: | ||
Paid in capital | $8,681,153 | |
Undistributed net investment income | 762 | |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | 251,102 | |
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies | 59,718 | |
Net Assets | $8,992,735 | |
Calculation of Maximum Offering Price | ||
Class A: | ||
Net Asset Value and redemption price per share ($2,768,122 ÷ 248,729 shares) | $11.13 | |
Maximum offering price per share (100/94.25 of $11.13) | $11.81 | |
Class T: | ||
Net Asset Value and redemption price per share ($869,186 ÷ 78,453 shares) | $11.08 | |
Maximum offering price per share (100/96.50 of $11.08) | $11.48 | |
Class C: | ||
Net Asset Value and offering price per share ($958,083 ÷ 87,402 shares)(a) | $10.96 | |
Class I: | ||
Net Asset Value, offering price and redemption price per share ($4,397,344 ÷ 393,259 shares) | $11.18 |
(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.
Statement of Operations
Six months ended October 31, 2016 (Unaudited) | ||
Investment Income | ||
Dividends | $67,576 | |
Interest | 54 | |
Income from Fidelity Central Funds | 1,656 | |
Total income | 69,286 | |
Expenses | ||
Management fee | ||
Basic fee | $37,072 | |
Performance adjustment | (2,634) | |
Transfer agent fees | 9,099 | |
Distribution and service plan fees | 10,978 | |
Accounting fees and expenses | 1,701 | |
Custodian fees and expenses | 2,000 | |
Independent trustees' fees and expenses | 18 | |
Registration fees | 17,076 | |
Audit | 23,275 | |
Legal | 12 | |
Miscellaneous | 166 | |
Total expenses before reductions | 98,763 | |
Expense reductions | (31,834) | 66,929 |
Net investment income (loss) | 2,357 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | 256,468 | |
Fidelity Central Funds | 136 | |
Foreign currency transactions | 468 | |
Futures contracts | 66,901 | |
Total net realized gain (loss) | 323,973 | |
Change in net unrealized appreciation (depreciation) on: Investment securities | (75,319) | |
Assets and liabilities in foreign currencies | 8 | |
Futures contracts | (39,663) | |
Total change in net unrealized appreciation (depreciation) | (114,974) | |
Net gain (loss) | 208,999 | |
Net increase (decrease) in net assets resulting from operations | $211,356 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Six months ended October 31, 2016 (Unaudited) | Year ended April 30, 2016 | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $2,357 | $49,270 |
Net realized gain (loss) | 323,973 | 59,963 |
Change in net unrealized appreciation (depreciation) | (114,974) | (332,806) |
Net increase (decrease) in net assets resulting from operations | 211,356 | (223,573) |
Distributions to shareholders from net investment income | (31,399) | – |
Distributions to shareholders from net realized gain | – | (78,048) |
Total Distributions | (31,399) | (78,048) |
Share transactions - net increase (decrease) | 683,520 | (365,630) |
Total increase (decrease) in net assets | 863,477 | (667,251) |
Net Assets | ||
Beginning of period | 8,129,258 | 8,796,509 |
End of period | $8,992,735 | $8,129,258 |
Other Information | ||
Undistributed net investment income end of period | $762 | $29,804 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Advisor Event Driven Opportunities Fund Class A
Six months ended (Unaudited) October 31, | Years ended April 30, | |||
2016 | 2016 | 2015 | 2014 A | |
Selected Per–Share Data | ||||
Net asset value, beginning of period | $10.87 | $11.26 | $10.58 | $10.00 |
Income from Investment Operations | ||||
Net investment income (loss)B | – | .08C | .01 | .02D |
Net realized and unrealized gain (loss) | .30 | (.36)E | .89F | .56G |
Total from investment operations | .30 | (.28) | .90 | .58 |
Distributions from net investment income | (.04) | – | (.01) | – |
Distributions from net realized gain | – | (.11) | (.20) | – |
Total distributions | (.04) | (.11) | (.22)H | – |
Net asset value, end of period | $11.13 | $10.87 | $11.26 | $10.58 |
Total ReturnI,J,K | 2.79% | (2.49)%E | 8.55%F | 5.80%G |
Ratios to Average Net AssetsL,M | ||||
Expenses before reductions | 2.30%N | 2.76% | 2.82% | 4.76%N |
Expenses net of fee waivers, if any | 1.55%N | 1.55% | 1.55% | 1.55%N |
Expenses net of all reductions | 1.53%N | 1.54% | 1.53% | 1.55%N |
Net investment income (loss) | .06%N | .74%C | .10% | .59%D,N |
Supplemental Data | ||||
Net assets, end of period (000 omitted) | $2,768 | $2,513 | $2,983 | $1,389 |
Portfolio turnover rateO | 112%N | 113% | 150% | 57%P |
A For the period December 12, 2013 (commencement of operations) to April 30, 2014.
B Calculated based on average shares outstanding during the period.
C Net Investment income per share reflects a large, non-recurring dividend which amounted to $.06 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .22%.
D Net Investment income per share reflects large, non-recurring dividends which amounted to $.03 per share. Excluding these non-recurring dividends, the ratio of net investment income (loss) to average net assets would have been (.25) %.
E Amount includes a reimbursement from the investment adviser for an operational error which amounted to les than $.01 per share. Excluding this reimbursement, the total return would have been (2.52)%.
F Amount includes a reimbursement from the investment adviser for an operational error which amounted to less than $.01 per share. Excluding this reimbursement, the total return would have been 8.47%.
G Amount includes a reimbursement from the investment adviser for an operational error which amounted to less than $.01 per share. Excluding this reimbursement, the total return would have been 5.70%.
H Total distributions of $.22 per share is comprised of distributions from net investment income of $.014 and distributions from net realized gain of $.201 per share.
I Total returns for periods of less than one year are not annualized.
J Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
K Total returns do not include the effect of the sales charges.
L Fees and expenses of any 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.
M 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. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
N Annualized
O Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
P Amount not annualized.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Advisor Event Driven Opportunities Fund Class T
Six months ended (Unaudited) October 31, | Years ended April 30, | |||
2016 | 2016 | 2015 | 2014 A | |
Selected Per–Share Data | ||||
Net asset value, beginning of period | $10.83 | $11.25 | $10.57 | $10.00 |
Income from Investment Operations | ||||
Net investment income (loss)B | (.01) | .05C | (.02) | .01D |
Net realized and unrealized gain (loss) | .29 | (.36)E | .89F | .56G |
Total from investment operations | .28 | (.31) | .87 | .57 |
Distributions from net investment income | (.03) | – | (.01) | – |
Distributions from net realized gain | – | (.11) | (.18) | – |
Total distributions | (.03) | (.11) | (.19) | – |
Net asset value, end of period | $11.08 | $10.83 | $11.25 | $10.57 |
Total ReturnH,I,J | 2.61% | (2.76)%E | 8.35%F | 5.70%G |
Ratios to Average Net AssetsK,L | ||||
Expenses before reductions | 2.62%M | 2.98% | 3.18% | 4.95%M |
Expenses net of fee waivers, if any | 1.80%M | 1.80% | 1.80% | 1.80%M |
Expenses net of all reductions | 1.78%M | 1.79% | 1.78% | 1.80%M |
Net investment income (loss) | (.20)%M | .49%C | (.15)% | .34%D,M |
Supplemental Data | ||||
Net assets, end of period (000 omitted) | $869 | $966 | $1,977 | $1,631 |
Portfolio turnover rateN | 112%M | 113% | 150% | 57%O |
A For the period December 12, 2013 (commencement of operations) to April 30, 2014.
B Calculated based on average shares outstanding during the period.
C Net Investment income per share reflects a large, non-recurring dividend which amounted to $.06 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been (.03) %.
D Net Investment income per share reflects large, non-recurring dividends which amounted to $.03 per share. Excluding these non-recurring dividends, the ratio of net investment income (loss) to average net assets would have been (.50) %.
E Amount includes a reimbursement from the investment adviser for an operational error which amounted to less than $.01 per share. Excluding this reimbursement, the total return would have been (2.79)%.
F Amount includes a reimbursement from the investment adviser for an operational error which amounted to less than $.01 per share. Excluding this reimbursement, the total return would have been 8.27%.
G Amount includes a reimbursement from the investment adviser for an operational error which amounted to less than $.01 per share. Excluding this reimbursement, the total return would have been 5.60%.
H Total returns for periods of less than one year are not annualized.
I Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
J Total returns do not include the effect of the sales charges.
K Fees and expenses of any 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.
L 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. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
M Annualized
N Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
O Amount not annualized.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Advisor Event Driven Opportunities Fund Class C
Six months ended (Unaudited) October 31, | Years ended April 30, | |||
2016 | 2016 | 2015 | 2014 A | |
Selected Per–Share Data | ||||
Net asset value, beginning of period | $10.72 | $11.19 | $10.55 | $10.00 |
Income from Investment Operations | ||||
Net investment income (loss)B | (.04) | –C,D | (.07) | (.01)E |
Net realized and unrealized gain (loss) | .30 | (.36)F | .88G | .56H |
Total from investment operations | .26 | (.36) | .81 | .55 |
Distributions from net investment income | (.02) | – | – | – |
Distributions from net realized gain | – | (.11) | (.17) | – |
Total distributions | (.02) | (.11) | (.17) | – |
Net asset value, end of period | $10.96 | $10.72 | $11.19 | $10.55 |
Total ReturnI,J,K | 2.38% | (3.23)%F | 7.75%G | 5.50%H |
Ratios to Average Net AssetsL,M | ||||
Expenses before reductions | 3.07%N | 3.46% | 3.63% | 5.38%N |
Expenses net of fee waivers, if any | 2.30%N | 2.30% | 2.30% | 2.30%N |
Expenses net of all reductions | 2.28%N | 2.29% | 2.29% | 2.30%N |
Net investment income (loss) | (.70)%N | (.01)%C | (.65)% | (.16)%E,N |
Supplemental Data | ||||
Net assets, end of period (000 omitted) | $958 | $1,046 | $1,846 | $3,011 |
Portfolio turnover rateO | 112%N | 113% | 150% | 57%P |
A For the period December 12, 2013 (commencement of operations) to April 30, 2014.
B Calculated based on average shares outstanding during the period.
C Net Investment income per share reflects a large, non-recurring dividend which amounted to $.06 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been (.53) %.
D Amount represents less than $.005 per share.
E Net Investment income per share reflects large, non-recurring dividends which amounted to $.03 per share. Excluding these non-recurring dividends, the ratio of net investment income (loss) to average net assets would have been (1.00) %.
F Amount includes a reimbursement from the investment adviser for an operational error which amounted to less than $.01 per share. Excluding this reimbursement, the total return would have been (3.26)%.
G Amount includes a reimbursement from the investment adviser for an operational error which amounted to less than $.01 per share. Excluding this reimbursement, the total return would have been 7.67%.
H Amount includes a reimbursement from the investment adviser for an operational error which amounted to less than $.01 per share. Excluding this reimbursement, the total return would have been 5.40%.
I Total returns for periods of less than one year are not annualized.
J Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
K Total returns do not include the effect of the contingent deferred sales charge.
L Fees and expenses of any 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.
M 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. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
N Annualized
O Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
P Amount not annualized.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Advisor Event Driven Opportunities Fund Class I
Six months ended (Unaudited) October 31, | Years ended April 30, | |||
2016 | 2016 | 2015 | 2014 A | |
Selected Per–Share Data | ||||
Net asset value, beginning of period | $10.91 | $11.28 | $10.59 | $10.00 |
Income from Investment Operations | ||||
Net investment income (loss)B | .02 | .11C | .04 | .03D |
Net realized and unrealized gain (loss) | .30 | (.37)E | .89F | .56G |
Total from investment operations | .32 | (.26) | .93 | .59 |
Distributions from net investment income | (.05) | – | (.03) | – |
Distributions from net realized gain | – | (.11) | (.21) | – |
Total distributions | (.05) | (.11) | (.24) | – |
Net asset value, end of period | $11.18 | $10.91 | $11.28 | $10.59 |
Total ReturnH,I | 2.94% | (2.31)%E | 8.86%F | 5.90%G |
Ratios to Average Net AssetsJ,K | ||||
Expenses before reductions | 1.93%L | 2.17% | 2.63% | 4.50%L |
Expenses net of fee waivers, if any | 1.30%L | 1.30% | 1.30% | 1.30%L |
Expenses net of all reductions | 1.28%L | 1.28% | 1.28% | 1.30%L |
Net investment income (loss) | .31%L | 1.00%C | .35% | .84%D,L |
Supplemental Data | ||||
Net assets, end of period (000 omitted) | $4,397 | $3,604 | $1,990 | $1,962 |
Portfolio turnover rateM | 112%L | 113% | 150% | 57%N |
A For the period December 12, 2013 (commencement of operations) to April 30, 2014.
B Calculated based on average shares outstanding during the period.
C Net Investment income per share reflects a large, non-recurring dividend which amounted to $.06 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .47%.
D Net Investment income per share reflects large, non-recurring dividends which amounted to $.03 per share. Excluding these non-recurring dividends, the ratio of net investment income (loss) to average net assets would have been (.01) %.
E Amount includes a reimbursement from the investment adviser for an operational error which amounted to less than $.01 per share. Excluding this reimbursement, the total return would have been (2.34)%.
F Amount includes a reimbursement from the investment adviser for an operational error which amounted to less than $.01 per share. Excluding this reimbursement, the total return would have been 8.78%.
G Amount includes a reimbursement from the investment adviser for an operational error which amounted to less than $.01 per share. Excluding this reimbursement, the total return would have been 5.80%.
H Total returns for periods of less than one year are not annualized.
I Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
J Fees and expenses of any 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.
K 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. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
L Annualized
M Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
N Amount not annualized.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended October 31, 2016
1. Organization.
Fidelity Advisor Event Driven Opportunities Fund (the Fund) is a non-diversified fund of Fidelity Concord Street Trust (the Trust) (formerly a fund of Fidelity Commonwealth 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 C and Class I shares, each of which has equal rights as to assets and voting privileges. Each class has exclusive voting rights with respect to matters that affect that class.
2. Investments in Fidelity Central Funds.
The Fund invests in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser 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 the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website 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. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Trustees (the Board) has delegated the day to day responsibility for the valuation of the Fund's investments to the Fair Value Committee (the Committee) established by the Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, the Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment 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 Committee oversees the Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing the Fund's investments and ratifies the fair value determinations of the Committee.
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)
Valuation techniques used to value the Fund's investments by major category are as follows:
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing vendor 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 or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For foreign equity securities, when market or security specific events arise, comparisons to the valuation of American Depositary Receipts (ADRs), futures contracts, Exchange-Traded Funds (ETFs) and certain indexes as well as quoted prices for similar securities may be used and would be categorized as Level 2 in the hierarchy. Utilizing these techniques may result in transfers between Level 1 and Level 2. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Debt securities, including restricted securities, are valued based on evaluated prices received from third party pricing vendors or from brokers who make markets in such securities. U.S. government and government agency obligations are valued by pricing vendors who utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type or by broker-supplied prices. When independent prices are unavailable or unreliable, debt securities may be valued utilizing pricing methodologies which consider similar factors that would be used by third party pricing vendors. Debt securities are generally categorized as Level 2 in the hierarchy but may be Level 3 depending on the circumstances. ETFs are valued at their last sale price or official closing price as reported by a third party pricing vendor 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 believes reflects fair value in accordance with the Board's fair value pricing policies and may be categorized as Level 2 in the hierarchy.
Futures contracts are valued at the settlement price established each day by the board of trade or exchange on which they are traded and are categorized as Level 1 in the hierarchy. Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
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 October 31, 2016 is included at the end of the Fund's Schedule of Investments.
Foreign Currency. The Fund may use 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 rates 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. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Distributions received on securities that represent a return of capital or capital gain are recorded as a reduction of cost of investments and/or as a realized gain. Subsequent to ex-dividend date the Fund determines the components of these distributions, based upon receipt of tax filings or other correspondence relating to the underlying investment. Interest income is accrued as earned and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.
Class Allocations and Expenses. Investment income, realized and unrealized capital gains and losses, common expenses of the Fund, and certain fund-level expense reductions, if any, are allocated daily 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 may also differ by class. For the reporting period, the allocated portion of income and expenses to each class as a percent of its average net assets may vary due to the timing of recording these transactions in relation to fluctuating net assets of the classes. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. 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 under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. The Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction. Foreign taxes are provided for based on the Fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.
Distributions are declared and 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. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to futures contracts, foreign currency transactions, market discount and losses deferred due to wash sales and excise tax regulations.
The federal tax cost of investment securities and unrealized appreciation (depreciation) as of period end were as follows:
Gross unrealized appreciation | $776,034 |
Gross unrealized depreciation | (774,124) |
Net unrealized appreciation (depreciation) on securities | $1,910 |
Tax cost | $8,885,469 |
The Fund elected to defer to its next fiscal year approximately $7,657 of capital losses recognized during the period November 1, 2015 to April 30, 2016.
4. Derivative Instruments.
Risk Exposures and the Use of Derivative Instruments. The Fund's investment objective allows the Fund to enter into various types of derivative contracts, including futures contracts. Derivatives are investments whose value is primarily derived from underlying assets, indices or reference rates and may be transacted on an exchange or over-the-counter (OTC). Derivatives may involve a future commitment to buy or sell a specified asset based on specified terms, to exchange future cash flows at periodic intervals based on a notional principal amount, or for one party to make one or more payments upon the occurrence of specified events in exchange for periodic payments from the other party.
The Fund used derivatives to increase returns and to manage exposure to certain risks as defined below. The success of any strategy involving derivatives depends on analysis of numerous economic factors, and if the strategies for investment do not work as intended, the Fund may not achieve its objectives.
The Fund's use of derivatives increased or decreased its exposure to the following risk:
Equity Risk | Equity risk relates to the fluctuations in the value of financial instruments as a result of changes in market prices (other than those arising from interest rate risk or foreign exchange risk), whether caused by factors specific to an individual investment, its issuer, or all factors affecting all instruments traded in a market or market segment. |
The Fund is also exposed to additional risks from investing in derivatives, such as liquidity risk and counterparty credit risk. Liquidity risk is the risk that the Fund will be unable to close out the derivative in the open market in a timely manner. Counterparty credit risk is the risk that the counterparty will not be able to fulfill its obligation to the Fund. Counterparty credit risk related to exchange-traded futures contracts may be mitigated by the protection provided by the exchange on which they trade.
Investing in derivatives may involve greater risks than investing in the underlying assets directly and, to varying degrees, may involve risk of loss in excess of any initial investment and collateral received and amounts recognized in the Statement of Assets and Liabilities. In addition, there may be the risk that the change in value of the derivative contract does not correspond to the change in value of the underlying instrument.
Futures Contracts. A futures contract is an agreement between two parties to buy or sell a specified underlying instrument for a fixed price at a specified future date. The Fund used futures contracts to manage its exposure to the stock market.
Upon entering into a futures contract, a fund is required to deposit either cash or securities (initial margin) with a clearing broker in an amount equal to a certain percentage of the face value of the contract. Futures contracts are marked-to-market daily and subsequent daily payments (variation margin) are made or received by a fund depending on the daily fluctuations in the value of the futures contracts and are recorded as unrealized appreciation or (depreciation). This receivable and/or payable, if any, is included in daily variation margin for derivative instruments in the Statement of Assets and Liabilities. Realized gain or (loss) is recorded upon the expiration or closing of a futures contract.
Any open futures contracts at period end are presented in the Schedule of Investments under the caption "Futures Contracts". The underlying face amount at value reflects each contract's exposure to the underlying instrument or index at period end. Securities deposited to meet initial margin requirements are identified in the Schedule of Investments.
During the period the Fund recognized net realized gain (loss) of $66,901 and a change in net unrealized appreciation (depreciation) of $(39,663) related to its investment in futures contracts. These amounts are included in the Statement of Operations.
5. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities, aggregated $5,136,634 and $4,425,721, respectively.
6. Fees and Other Transactions with Affiliates.
Management Fee. Fidelity Management & Research Company (the investment adviser) 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 .60% of the Fund's average net assets and an annualized group fee rate that averaged .25% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by the investment adviser, including any mutual funds previously advised by the investment adviser that are currently advised by Fidelity SelectCo, LLC, an affiliate of the investment adviser. The group fee rate decreases as assets under management increase and increases as assets under management decrease. In addition, the management fee is subject to a performance adjustment (up to a maximum of +/- .10% of the Fund's average net assets over a 36 month performance period). The upward or downward adjustment to the management fee is based on the relative investment performance of Class I of the Fund as compared to its benchmark index, the Russell 3000 Index, over the same 36 month performance period. For the reporting period, the total annualized management fee rate, including the performance adjustment, was .79% of the Fund's average net assets. The performance adjustment included in the management fee rate may be higher or lower than the maximum performance adjustment rate due to the difference between the average net assets for the reporting and performance periods.
Distribution and Service Plan Fees. 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 the investment adviser, 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, total fees and amounts retained by FDC were as follows:
Distribution Fee | Service Fee | Total Fees | Retained by FDC | |
Class A | -% | .25% | $3,462 | $3,462 |
Class T | .25% | .25% | 2,348 | 2,348 |
Class C | .75% | .25% | 5,168 | 5,168 |
$10,978 | $10,978 |
Sales Load. FDC may receive a front-end sales charge of up to 5.75% for selling Class A shares and 3.50% for selling Class T shares, some of which is paid to financial intermediaries for selling shares of the Fund. Depending on the holding period, FDC may receive contingent deferred sales charges levied on Class A, Class T, and Class C redemptions. The deferred sales charges are 1.00% for Class C shares, 1.00% 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 | $1,370 |
Class T | 39 |
Class C(a) | 3 |
$1,412 |
(a) When Class C shares are initially sold, FDC pays commissions from its own resources to financial intermediaries through which the sales are made.
Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc., (FIIOC), an affiliate of the investment adviser, 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, transfer agent fees for each class were as follows:
Amount | % of Class-Level Average Net Assets(a) | |
Class A | $3,498 | .25 |
Class T | 1,427 | .30 |
Class C | 1,268 | .25 |
Class I | 2,906 | .15 |
$9,099 |
(a) Annualized
Accounting Fees. Fidelity Service Company, Inc. (FSC), an affiliate of the investment adviser, maintains the Fund's accounting records. The fee is based on the level of average net assets for each month.
Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. Brokerage commissions are included in net realized gain (loss) and change in net unrealized appreciation (depreciation) in the Statement of Operations. The commissions paid to these affiliated firms were $339 for the period.
Interfund Trades. The Fund may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
7. Committed Line of Credit.
The Fund participates with other funds managed by the investment adviser or an affiliate in a $4.25 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 $14 and is reflected in Miscellaneous expenses on the Statement of Operations. During the period, the Fund did not borrow on this line of credit.
8. Expense Reductions.
The investment adviser contractually agreed to reimburse each class to the extent annual operating expenses exceeded certain levels of average net assets as noted in the table below. This reimbursement will remain in place through June 30, 2018. 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 | |
Class A | 1.55% | $10,402 |
Class T | 1.80% | 3,836 |
Class C | 2.30% | 3,978 |
Class I | 1.30% | 12,716 |
$30,932 |
Commissions paid to certain brokers with whom the investment adviser, or its affiliates, places trades on behalf of the Fund include an amount in addition to trade execution, which may be rebated back to the Fund to offset certain expenses. This amount totaled $858 for the period. Through arrangements with the Fund's custodian credits realized as a result of certain uninvested cash balances were used to reduce the Fund's expenses. During the period, these credits reduced the Fund's custody expenses by $17.
In addition, during the period the investment adviser reimbursed and/or waived a portion of fund-level operating expenses in the amount of $27.
9. Distributions to Shareholders.
Distributions to shareholders of each class were as follows:
Six months ended October 31, 2016 | Year ended April 30, 2016 | |
From net investment income | ||
Class A | $10,330 | $– |
Class T | 2,826 | – |
Class C | 1,451 | – |
Class I | 16,792 | – |
Total | $31,399 | $– |
From net realized gain | ||
Class A | $– | $28,471 |
Class T | – | 16,290 |
Class C | – | 15,945 |
Class I | – | 17,342 |
Total | $– | $78,048 |
10. Share Transactions.
Share transactions for each class were as follows and may contain automatic conversions between classes or exchanges between affiliated funds:
Shares | Shares | Dollars | Dollars | |
Six months ended October 31, 2016 | Year ended April 30, 2016 | Six months ended October 31, 2016 | Year ended April 30, 2016 | |
Class A | ||||
Shares sold | 36,229 | 70,567 | $404,910 | $758,382 |
Reinvestment of distributions | 874 | 2,331 | 9,774 | 26,229 |
Shares redeemed | (19,593) | (106,527) | (219,117) | (1,162,165) |
Net increase (decrease) | 17,510 | (33,629) | $195,567 | $(377,554) |
Class T | ||||
Shares sold | 1,869 | 8,615 | $20,758 | $93,355 |
Reinvestment of distributions | 254 | 1,449 | 2,826 | 16,290 |
Shares redeemed | (12,908) | (96,589) | (144,848) | (1,049,955) |
Net increase (decrease) | (10,785) | (86,525) | $(121,264) | $(940,310) |
Class C | ||||
Shares sold | 1,960 | 32,297 | $21,615 | $350,788 |
Reinvestment of distributions | 127 | 1,393 | 1,404 | 15,570 |
Shares redeemed | (12,262) | (101,079) | (137,352) | (1,079,870) |
Net increase (decrease) | (10,175) | (67,389) | $(114,333) | $(713,512) |
Class I | ||||
Shares sold | 85,325 | 235,816 | $975,950 | $2,558,721 |
Reinvestment of distributions | 1,355 | 1,488 | 15,198 | 16,789 |
Shares redeemed | (23,677) | (83,510) | (267,598) | (909,764) |
Net increase (decrease) | 63,003 | 153,794 | $723,550 | $1,665,746 |
11. 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.
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments or redemption proceeds, and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (May 1, 2016 to October 31, 2016).
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.
Annualized Expense Ratio-A | Beginning Account Value May 1, 2016 | Ending Account Value October 31, 2016 | Expenses Paid During Period-B May 1, 2016 to October 31, 2016 | |
Class A | 1.55% | |||
Actual | $1,000.00 | $1,027.90 | $7.92 | |
Hypothetical-C | $1,000.00 | $1,017.39 | $7.88 | |
Class T | 1.80% | |||
Actual | $1,000.00 | $1,026.10 | $9.19 | |
Hypothetical-C | $1,000.00 | $1,016.13 | $9.15 | |
Class C | 2.30% | |||
Actual | $1,000.00 | $1,023.80 | $11.73 | |
Hypothetical-C | $1,000.00 | $1,013.61 | $11.67 | |
Class I | 1.30% | |||
Actual | $1,000.00 | $1,029.40 | $6.65 | |
Hypothetical-C | $1,000.00 | $1,018.65 | $6.61 |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).
C 5% return per year before expenses
Board Approval of Investment Advisory Contracts and Management Fees
Fidelity Advisor Event Driven Opportunities Fund
Each year, the Board of Trustees, including the Independent Trustees (together, the Board), votes on the renewal of the management contract with Fidelity Management & Research Company (FMR) and the sub-advisory agreements (together, the Advisory Contracts) for the fund. The Board, assisted by the advice of fund counsel and Independent Trustees' counsel, requests and considers a broad range of information relevant to the renewal of the Advisory Contracts throughout the year.
The Board meets regularly and, at each of its meetings, covers an extensive agenda of topics and materials and considers factors that are relevant to its annual consideration of the renewal of the fund's Advisory Contracts, including the services and support provided to the fund and its shareholders. The Board has established various standing committees (Committees), each composed of and chaired by Independent Trustees with varying backgrounds, to which the Board has assigned specific subject matter responsibilities in order to enhance effective decision-making by the Board. The Board, acting directly and through its Committees, requests and receives information concerning the annual consideration of the renewal of the fund's Advisory Contracts. The Board also meets as needed to consider matters specifically related to the Board's annual consideration of the renewal of the Advisory Contracts. Members of the Board may also meet with trustees of other Fidelity funds through ad hoc joint committees to discuss certain matters relevant to all of the Fidelity funds.
At its July 2016 meeting, the Board unanimously determined to renew the fund's Advisory Contracts. In reaching its determination, the Board considered all factors it believed relevant, including (i) the nature, extent, and quality of the services to be provided to the fund and its shareholders (including the investment performance of the fund); (ii) the competitiveness of the fund's management fee and total expense ratio relative to peer funds; (iii) the total costs of the services to be provided by and the profits to be realized by Fidelity from its relationships with the fund; and (iv) the extent to which, if any, economies of scale exist and would be realized as the fund grows, and whether any economies of scale are appropriately shared with fund shareholders.
In considering whether to renew the Advisory Contracts for the fund, the Board reached a determination, with the assistance of fund counsel and Independent Trustees' counsel and through the exercise of its business judgment, that the renewal of the Advisory Contracts was in the best interests of the fund and its shareholders and that the compensation payable under the Advisory Contracts was fair and reasonable. The Board's decision to renew the Advisory Contracts was not based on any single factor, but rather was based on a comprehensive consideration of all the information provided to the Board at its meetings throughout the year. The Board, in reaching its determination to renew the Advisory Contracts, was aware that shareholders of the fund have a broad range of investment choices available to them, including a wide choice among funds offered by Fidelity's competitors, and that the fund's shareholders, who have the opportunity to review and weigh the disclosure provided by the fund in its prospectus and other public disclosures, have chosen to invest in this fund, which is part of the Fidelity family of funds.
Nature, Extent, and Quality of Services Provided. The Board considered Fidelity's staffing as it relates to the fund, including the backgrounds of investment personnel of Fidelity, and also considered the fund's investment objective, strategies, and related investment philosophy. The Independent Trustees also had discussions with senior management of Fidelity's investment operations and investment groups. The Board considered the structure of the investment personnel compensation program and whether this structure provides appropriate incentives to act in the best interests of the fund. Additionally, the Board considered the portfolio managers' investments, if any, in the funds that they manage.Resources Dedicated to Investment Management and Support Services. The Board and the Fund Oversight and Research Committees reviewed the general qualifications and capabilities of Fidelity's investment staff, including its size, education, experience, and resources, as well as Fidelity's approach to recruiting, training, managing, and compensating investment personnel. The Board noted that Fidelity has continued to increase the resources devoted to non-U.S. offices, including expansion of Fidelity's global investment organization. The Board also noted that Fidelity's analysts have extensive resources, tools and capabilities that allow them to conduct sophisticated quantitative and fundamental analysis, as well as credit analysis of issuers, counterparties and guarantors. Further, the Board considered that Fidelity's investment professionals have sufficient access to global information and data so as to provide competitive investment results over time, and that those professionals also have access to sophisticated tools that permit them to assess portfolio construction and risk and performance attribution characteristics continuously, as well as to transmit new information and research conclusions rapidly around the world. Additionally, in its deliberations, the Board considered Fidelity's trading, risk management, compliance, and technology and operations capabilities and resources, which are integral parts of the investment management process.Shareholder and Administrative Services. The Board considered (i) the nature, extent, quality, and cost of advisory, administrative, and shareholder services performed by FMR, the sub-advisers (together with FMR, the Investment Advisers), and their affiliates under the Advisory Contracts and under separate agreements covering transfer agency, pricing and bookkeeping, and securities lending services for the fund; (ii) the nature and extent of the supervision of third party service providers, principally custodians, subcustodians, and pricing vendors; and (iii) the resources devoted to, and the record of compliance with, the fund's compliance policies and procedures. The Board also reviewed the allocation of fund brokerage, including allocations to brokers affiliated with the Investment Advisers, the use of brokerage commissions to pay fund expenses, and the use of "soft" commission dollars to pay for research services.The Board noted that the growth of fund assets over time across the complex allows Fidelity to reinvest in the development of services designed to enhance the value or convenience of the Fidelity funds as investment vehicles. These services include 24-hour access to account information and market information through telephone representatives and over the Internet, investor education materials and asset allocation tools, and the expanded availability of Fidelity Investor Centers.In 2014, the Board formed an ad hoc Committee on Transfer Agency Fees to review the variety of transfer agency fee structures throughout the industry and Fidelity's competitive positioning with respect to industry participants.Investment in a Large Fund Family. The Board considered the benefits to shareholders of investing in a Fidelity fund, including the benefits of investing in a fund that is part of a large family of funds offering a variety of investment disciplines and providing a large variety of mutual fund investor services. The Board noted that Fidelity had taken, or had made recommendations that resulted in the Fidelity funds taking, a number of actions over the previous year that benefited particular funds, including: (i) continuing to dedicate additional resources to investment research and to the support of the senior management team that oversees asset management; (ii) continuing efforts to enhance Fidelity's global research capabilities; (iii) launching new funds and making other enhancements to meet client needs; (iv) broadening eligibility requirements for certain lower-priced share classes of, and streamlining the fee structure for, certain existing equity index funds; (v) lowering expense caps for certain existing funds and classes to reduce expenses paid by shareholders; (vi) eliminating redemption fees for certain variable insurance product funds and classes; (vii) continuing to launch dedicated lower cost underlying funds to meet portfolio construction needs related to expanding underlying fund options for Fidelity funds of funds, specifically for the Freedom Fund product lines; (viii) launching a lower cost share class for use by the Freedom Index Fund product line; (ix) rationalizing product lines and gaining increased efficiencies through fund mergers and share class consolidations; (x) continuing to develop, acquire and implement systems and technology to improve services to the funds and shareholders, strengthen information security, and increase efficiency; (xi) implementing investment enhancements to further strengthen Fidelity's target date product line to increase investors' probability of success in achieving their goals; (xii) accelerating the conversion of all remaining Class B shares to Class A shares, which have a lower expense structure; and (xiii) implementing changes to Fidelity's money market fund product line in response to recent regulatory reforms.Investment Performance. The Board considered whether the fund has operated in accordance with its investment objective, as well as its record of compliance with its investment restrictions and its performance history.The Board took into account discussions with representatives of the Investment Advisers about fund investment performance that occur at Board meetings throughout the year. In this regard the Board noted that as part of regularly scheduled fund reviews and other reports to the Board on fund performance, the Board considers annualized return information for the fund, for different time periods, measured against a securities market index ("benchmark index") and a peer group of funds with similar objectives ("peer group"), if any. In its evaluation of fund investment performance, the Board gave particular attention to information indicating changes in performance of certain Fidelity funds for specific time periods and discussed with the Investment Advisers the reasons for any overperformance or underperformance.In addition to reviewing absolute and relative fund performance, the Independent Trustees periodically consider the appropriateness of fund performance metrics in evaluating the results achieved. In general, the Independent Trustees believe that fund performance should be evaluated based on net performance (after fees and expenses) of both the highest performing and lowest performing fund share classes, where applicable, compared to appropriate benchmark indices, over appropriate time periods that may include full market cycles, and compared to peer groups, as applicable, over the same periods, taking into account relevant factors including the following: general market conditions; issuer-specific information; and fund cash flows and other factors.The Independent Trustees recognize that shareholders evaluate performance on a net basis over their own holding periods, for which one-, three-, and five-year periods are often used as a proxy. For this reason, the performance information reviewed by the Board also included net cumulative calendar year total return information for the fund and an appropriate benchmark index for the most recent one-year period, as shown below. A peer group is not shown below because the fund does not generally utilize a peer group for performance comparison purposes.Fidelity Advisor Event Driven Opportunities Fund
Fidelity Advisor Event Driven Opportunities Fund
AEDO-SANN-1216
1.9585369.102
Fidelity® Event Driven Opportunities Fund Semi-Annual Report October 31, 2016 |
Contents
Board Approval of Investment Advisory Contracts and Management Fees |
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 1-800-544-8544 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third-party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. © 2016 FMR LLC. All rights reserved.
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, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Fund nor Fidelity Distributors Corporation is a bank.
Investment Summary (Unaudited)
Top Ten Stocks as of October 31, 2016
% of fund's net assets | % of fund's net assets 6 months ago | |
Exterran Corp. | 10.0 | 3.3 |
Universal Corp. | 6.8 | 11.8 |
The Brink's Co. | 4.4 | 2.6 |
The Madison Square Garden Co. | 4.2 | 2.9 |
TopBuild Corp. | 4.1 | 3.0 |
Alliance Data Systems Corp. | 3.3 | 0.0 |
Encore Capital Group, Inc. | 3.1 | 2.1 |
Kimball Electronics, Inc. | 3.1 | 2.5 |
Time, Inc. | 3.0 | 3.2 |
DepoMed, Inc. | 2.7 | 2.1 |
44.7 |
Top Five Market Sectors as of October 31, 2016
% of fund's net assets | % of fund's net assets 6 months ago | |
Consumer Discretionary | 22.9 | 25.2 |
Information Technology | 20.6 | 7.1 |
Financials | 13.9 | 13.7 |
Industrials | 10.0 | 14.2 |
Energy | 10.0 | 3.3 |
Prior period industry classifications reflect the categories in place as of the date indicated and have not been adjusted to reflect current industry classifications.
Asset Allocation (% of fund's net assets)
As of October 31, 2016 * | ||
Stocks and Equity Futures | 96.7% | |
Short-Term Investments and Net Other Assets (Liabilities) | 3.3% |
* Foreign investments - 5.6%
As of April 30, 2016 * | ||
Stocks and Equity Futures | 97.2% | |
Short-Term Investments and Net Other Assets (Liabilities) | 2.8% |
* Foreign investments - 2.9%
Percentages shown as 0.0% may reflect amounts less than 0.05%.
Investments October 31, 2016 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 91.8% | |||
Shares | Value | ||
CONSUMER DISCRETIONARY - 22.9% | |||
Diversified Consumer Services - 2.4% | |||
Apollo Education Group, Inc. Class A (non-vtg.) (a) | 456,600 | $4,013,514 | |
Household Durables - 4.1% | |||
TopBuild Corp. (a) | 233,284 | 7,028,847 | |
Internet & Direct Marketing Retail - 0.8% | |||
Liberty TripAdvisor Holdings, Inc. (a) | 60,800 | 1,349,760 | |
Leisure Products - 1.4% | |||
Vista Outdoor, Inc. (a) | 62,200 | 2,405,274 | |
Media - 11.5% | |||
Cable One, Inc. | 2,700 | 1,557,198 | |
Gannett Co., Inc. | 79,700 | 619,269 | |
NZME Ltd. | 2,860,243 | 1,370,391 | |
The Madison Square Garden Co. (a) | 42,579 | 7,046,399 | |
Time, Inc. | 392,900 | 5,107,700 | |
Twenty-First Century Fox, Inc. Class B | 144,400 | 3,810,716 | |
19,511,673 | |||
Specialty Retail - 2.7% | |||
Barnes & Noble Education, Inc. (a) | 366,356 | 3,410,774 | |
Signet Jewelers Ltd. | 13,400 | 1,088,884 | |
4,499,658 | |||
TOTAL CONSUMER DISCRETIONARY | 38,808,726 | ||
CONSUMER STAPLES - 9.0% | |||
Food & Staples Retailing - 0.7% | |||
SUPERVALU, Inc. (a) | 263,000 | 1,128,270 | |
Food Products - 1.5% | |||
Mondelez International, Inc. | 29,900 | 1,343,706 | |
SunOpta, Inc. (a) | 194,388 | 1,292,680 | |
2,636,386 | |||
Tobacco - 6.8% | |||
Universal Corp. | 212,418 | 11,513,056 | |
TOTAL CONSUMER STAPLES | 15,277,712 | ||
ENERGY - 10.0% | |||
Energy Equipment & Services - 10.0% | |||
Exterran Corp. (a) | 1,063,115 | 16,807,847 | |
FINANCIALS - 13.9% | |||
Capital Markets - 2.9% | |||
Associated Capital Group, Inc. | 69,500 | 2,359,525 | |
PJT Partners, Inc. (b) | 93,200 | 2,566,728 | |
4,926,253 | |||
Consumer Finance - 3.1% | |||
Encore Capital Group, Inc. (a)(b) | 260,270 | 5,166,360 | |
Diversified Financial Services - 2.8% | |||
Donnelley Financial Solutions, Inc. (a) | 117,700 | 2,524,665 | |
ECN Capital Corp. | 1,015,100 | 2,217,433 | |
4,742,098 | |||
Insurance - 2.7% | |||
Genworth Financial, Inc. Class A (a) | 510,200 | 2,112,228 | |
Stewart Information Services Corp. | 55,500 | 2,494,725 | |
4,606,953 | |||
Thrifts & Mortgage Finance - 2.4% | |||
Fannie Mae (a)(b) | 1,200,317 | 2,040,539 | |
Freddie Mac (a)(b) | 1,294,033 | 2,070,453 | |
4,110,992 | |||
TOTAL FINANCIALS | 23,552,656 | ||
HEALTH CARE - 3.7% | |||
Health Care Providers & Services - 0.5% | |||
Quorum Health Corp. (a) | 202,178 | 816,799 | |
Pharmaceuticals - 3.2% | |||
DepoMed, Inc. (a) | 202,400 | 4,525,664 | |
Valeant Pharmaceuticals International, Inc. (United States) (a) | 52,300 | 933,032 | |
5,458,696 | |||
TOTAL HEALTH CARE | 6,275,495 | ||
INDUSTRIALS - 10.0% | |||
Aerospace & Defense - 0.8% | |||
KLX, Inc. (a) | 38,300 | 1,318,286 | |
Commercial Services & Supplies - 4.4% | |||
The Brink's Co. | 188,478 | 7,454,305 | |
Electrical Equipment - 0.8% | |||
Babcock & Wilcox Enterprises, Inc. (a) | 87,792 | 1,381,846 | |
Machinery - 2.1% | |||
Allison Transmission Holdings, Inc. | 122,649 | 3,592,389 | |
Professional Services - 1.9% | |||
Insperity, Inc. | 42,400 | 3,188,480 | |
TOTAL INDUSTRIALS | 16,935,306 | ||
INFORMATION TECHNOLOGY - 20.6% | |||
Communications Equipment - 1.2% | |||
Lumentum Holdings, Inc. (a) | 61,100 | 2,052,960 | |
Electronic Equipment & Components - 3.1% | |||
Kimball Electronics, Inc. (a) | 371,365 | 5,161,974 | |
Internet Software & Services - 1.4% | |||
CommerceHub, Inc. Series A, (a) | 162,200 | 2,436,244 | |
IT Services - 6.4% | |||
Alliance Data Systems Corp. | 27,300 | 5,582,031 | |
Computer Sciences Corp. | 48,900 | 2,662,605 | |
PayPal Holdings, Inc. (a) | 62,200 | 2,591,252 | |
10,835,888 | |||
Semiconductors & Semiconductor Equipment - 3.0% | |||
Marvell Technology Group Ltd. | 211,900 | 2,761,057 | |
Versum Materials, Inc. (a) | 102,700 | 2,331,290 | |
5,092,347 | |||
Software - 3.0% | |||
CDK Global, Inc. | 44,500 | 2,430,145 | |
TiVo Corp. (a) | 130,100 | 2,582,485 | |
5,012,630 | |||
Technology Hardware, Storage & Peripherals - 2.5% | |||
Hewlett Packard Enterprise Co. | 112,500 | 2,527,875 | |
Quantum Corp. (a) | 2,115,878 | 1,693,126 | |
4,221,001 | |||
TOTAL INFORMATION TECHNOLOGY | 34,813,044 | ||
MATERIALS - 0.9% | |||
Containers & Packaging - 0.9% | |||
Owens-Illinois, Inc. (a) | 77,400 | 1,493,820 | |
REAL ESTATE - 0.8% | |||
Equity Real Estate Investment Trusts (REITs) - 0.8% | |||
Four Corners Property Trust, Inc. | 68,738 | 1,380,259 | |
TOTAL COMMON STOCKS | |||
(Cost $154,795,402) | 155,344,865 | ||
Principal Amount | Value | ||
U.S. Treasury Obligations - 0.3% | |||
U.S. Treasury Bills, yield at date of purchase 0.18% to 0.33% 11/17/16 to 12/22/16 (c) | |||
(Cost $539,896) | 540,000 | 539,940 | |
Shares | Value | ||
Money Market Funds - 8.6% | |||
Fidelity Cash Central Fund, 0.41% (d) | 9,475,901 | $9,478,744 | |
Fidelity Securities Lending Cash Central Fund 0.48% (d)(e) | 5,148,436 | 5,149,465 | |
TOTAL MONEY MARKET FUNDS | |||
(Cost $14,625,798) | 14,628,209 | ||
TOTAL INVESTMENT PORTFOLIO - 100.7% | |||
(Cost $169,961,096) | 170,513,014 | ||
NET OTHER ASSETS (LIABILITIES) - (0.7)% | (1,233,028) | ||
NET ASSETS - 100% | $169,279,986 |
Futures Contracts | |||
Expiration Date | Underlying Face Amount at Value | Unrealized Appreciation/(Depreciation) | |
Purchased | |||
Equity Index Contracts | |||
67 CME E-mini S&P 500 Index Contracts (United States) | Dec. 2016 | 7,102,335 | $(121,936) |
10 ICE Russell 2000 Index Contracts (United States) | Dec. 2016 | 1,189,300 | (39,455) |
TOTAL FUTURES CONTRACTS | $(161,391) |
The face value of futures purchased as a percentage of Net Assets is 4.9%
For the period, the average monthly underlying face amount at value for futures contracts in the aggregate was $15,227,583.
Legend
(a) Non-income producing
(b) Security or a portion of the security is on loan at period end.
(c) Security or a portion of the security was pledged to cover margin requirements for futures contracts. At period end, the value of securities pledged amounted to $290,962.
(d) Affiliated fund that is generally 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. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
(e) Investment made with cash collateral received from securities on loan.
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 | $37,999 |
Fidelity Securities Lending Cash Central Fund | 153,374 |
Total | $191,373 |
Investment Valuation
The following is a summary of the inputs used, as of October 31, 2016, involving the Fund's assets and liabilities carried at fair 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 below, please refer to the Investment 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: | ||||
Equities: | ||||
Consumer Discretionary | $38,808,726 | $38,808,726 | $-- | $-- |
Consumer Staples | 15,277,712 | 15,277,712 | -- | -- |
Energy | 16,807,847 | 16,807,847 | -- | -- |
Financials | 23,552,656 | 23,552,656 | -- | -- |
Health Care | 6,275,495 | 6,275,495 | -- | -- |
Industrials | 16,935,306 | 16,935,306 | -- | -- |
Information Technology | 34,813,044 | 34,813,044 | -- | -- |
Materials | 1,493,820 | 1,493,820 | -- | -- |
Real Estate | 1,380,259 | 1,380,259 | -- | -- |
U.S. Government and Government Agency Obligations | 539,940 | -- | 539,940 | -- |
Money Market Funds | 14,628,209 | 14,628,209 | -- | -- |
Total Investments in Securities: | $170,513,014 | $169,973,074 | $539,940 | $-- |
Derivative Instruments: | ||||
Liabilities | ||||
Futures Contracts | $(161,391) | $(161,391) | $-- | $-- |
Total Liabilities | $(161,391) | $(161,391) | $-- | $-- |
Total Derivative Instruments: | $(161,391) | $(161,391) | $-- | $-- |
Value of Derivative Instruments
The following table is a summary of the Fund's value of derivative instruments by primary risk exposure as of October 31, 2016. For additional information on derivative instruments, please refer to the Derivative Instruments section in the accompanying Notes to Financial Statements.
Primary Risk Exposure / Derivative Type | Value | |
Asset | Liability | |
Equity Risk | ||
Futures Contracts(a) | $0 | $(161,391) |
Total Equity Risk | 0 | (161,391) |
Total Value of Derivatives | $0 | $(161,391) |
(a) Reflects gross cumulative appreciation (depreciation) on futures contracts as presented in the Schedule of Investments. In the Statement of Assets and Liabilities, the period end daily variation margin is included in receivable or payable for daily variation margin for derivative instruments, and the net cumulative appreciation (depreciation) is included in net unrealized appreciation (depreciation).
See accompanying notes which are an integral part of the financial statements.
Financial Statements
Statement of Assets and Liabilities
October 31, 2016 (Unaudited) | ||
Assets | ||
Investment in securities, at value (including securities loaned of $4,922,115) — See accompanying schedule: Unaffiliated issuers (cost $155,335,298) | $155,884,805 | |
Fidelity Central Funds (cost $14,625,798) | 14,628,209 | |
Total Investments (cost $169,961,096) | $170,513,014 | |
Receivable for investments sold | 5,284,094 | |
Receivable for fund shares sold | 195,192 | |
Dividends receivable | 172,150 | |
Distributions receivable from Fidelity Central Funds | 11,595 | |
Prepaid expenses | 463 | |
Other receivables | 2,505 | |
Total assets | 176,179,013 | |
Liabilities | ||
Payable for investments purchased | $1,324,070 | |
Payable for fund shares redeemed | 255,511 | |
Accrued management fee | 114,366 | |
Payable for daily variation margin for derivative instruments | 6,327 | |
Other affiliated payables | 29,575 | |
Other payables and accrued expenses | 21,353 | |
Collateral on securities loaned, at value | 5,147,825 | |
Total liabilities | 6,899,027 | |
Net Assets | $169,279,986 | |
Net Assets consist of: | ||
Paid in capital | $168,151,606 | |
Undistributed net investment income | 639,472 | |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | 98,357 | |
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies | 390,551 | |
Net Assets, for 15,000,888 shares outstanding | $169,279,986 | |
Net Asset Value, offering price and redemption price per share ($169,279,986 ÷ 15,000,888 shares) | $11.28 |
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Six months ended October 31, 2016 (Unaudited) | ||
Investment Income | ||
Dividends | $1,355,568 | |
Interest | 1,240 | |
Income from Fidelity Central Funds (including $153,374 from security lending) | 191,373 | |
Total income | 1,548,181 | |
Expenses | ||
Management fee | ||
Basic fee | $734,120 | |
Performance adjustment | (39,018) | |
Transfer agent fees | 142,347 | |
Accounting and security lending fees | 35,012 | |
Custodian fees and expenses | 3,013 | |
Independent trustees' fees and expenses | 369 | |
Registration fees | 11,142 | |
Audit | 20,680 | |
Legal | 258 | |
Miscellaneous | 818 | |
Total expenses before reductions | 908,741 | |
Expense reductions | (18,081) | 890,660 |
Net investment income (loss) | 657,521 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | 3,689,219 | |
Fidelity Central Funds | 4,663 | |
Foreign currency transactions | 9,626 | |
Futures contracts | 1,310,534 | |
Total net realized gain (loss) | 5,014,042 | |
Change in net unrealized appreciation (depreciation) on: Investment securities | (100,250) | |
Assets and liabilities in foreign currencies | 106 | |
Futures contracts | (465,638) | |
Total change in net unrealized appreciation (depreciation) | (565,782) | |
Net gain (loss) | 4,448,260 | |
Net increase (decrease) in net assets resulting from operations | $5,105,781 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Six months ended October 31, 2016 (Unaudited) | Year ended April 30, 2016 | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $657,521 | $2,600,912 |
Net realized gain (loss) | 5,014,042 | (3,074,020) |
Change in net unrealized appreciation (depreciation) | (565,782) | (6,082,164) |
Net increase (decrease) in net assets resulting from operations | 5,105,781 | (6,555,272) |
Distributions to shareholders from net investment income | (1,368,528) | (1,081,800) |
Distributions to shareholders from net realized gain | – | (945,437) |
Total distributions | (1,368,528) | (2,027,237) |
Share transactions | ||
Proceeds from sales of shares | 19,550,468 | 75,489,091 |
Reinvestment of distributions | 1,286,549 | 1,849,958 |
Cost of shares redeemed | (23,906,314) | (93,533,688) |
Net increase (decrease) in net assets resulting from share transactions | (3,069,297) | (16,194,639) |
Total increase (decrease) in net assets | 667,956 | (24,777,148) |
Net Assets | ||
Beginning of period | 168,612,030 | 193,389,178 |
End of period | $169,279,986 | $168,612,030 |
Other Information | ||
Undistributed net investment income end of period | $639,472 | $1,350,479 |
Shares | ||
Sold | 1,711,416 | 6,802,513 |
Issued in reinvestment of distributions | 113,452 | 163,583 |
Redeemed | (2,092,708) | (8,718,246) |
Net increase (decrease) | (267,840) | (1,752,150) |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Event Driven Opportunities Fund
Six months ended (Unaudited) October 31, | Years ended April 30, | |||
2016 | 2016 | 2015 | 2014 A | |
Selected Per–Share Data | ||||
Net asset value, beginning of period | $11.04 | $11.36 | $10.57 | $10.00 |
Income from Investment Operations | ||||
Net investment income (loss)B | .04 | .14C | .06 | .03D |
Net realized and unrealized gain (loss) | .29 | (.35)E | .95F | .55G |
Total from investment operations | .33 | (.21) | 1.01 | .58 |
Distributions from net investment income | (.09) | (.06) | (.06) | (.01) |
Distributions from net realized gain | – | (.05) | (.16) | – |
Total distributions | (.09) | (.11) | (.22) | (.01) |
Net asset value, end of period | $11.28 | $11.04 | $11.36 | $10.57 |
Total ReturnH,I | 2.98% | (1.89)%E | 9.64%F | 5.77%G |
Ratios to Average Net AssetsJ,K | ||||
Expenses before reductions | 1.05%L | 1.06% | 1.13% | 1.52%L |
Expenses net of fee waivers, if any | 1.05%L | 1.06% | 1.13% | 1.30%L |
Expenses net of all reductions | 1.03%L | 1.04% | 1.12% | 1.30%L |
Net investment income (loss) | .76%L | 1.31%C | .58% | .82%D,L |
Supplemental Data | ||||
Net assets, end of period (000 omitted) | $169,280 | $168,612 | $193,389 | $60,572 |
Portfolio turnover rateM | 105%L | 111% | 119% | 56%N |
A For the period December 12, 2013 (commencement of operations) to April 30, 2014.
B Calculated based on average shares outstanding during the period.
C Net Investment income per share reflects a large, non-recurring dividend which amounted to $.05 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .82%.
D Net Investment income per share reflects a large, non-recurring dividend which amounted to $.02 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .28%.
E Amount includes a reimbursement from the investment adviser for an operational error which amounted to less than $.01 per share. Excluding this reimbursement, the total return would have been (1.92)%.
F Amount includes a reimbursement from the investment adviser for an operational error which amounted to less than $.01 per share. Excluding this reimbursement, the total return would have been 9.57%.
G Amount includes a reimbursement from the investment adviser for an operational error which amounted to less than $.01 per share. Excluding this reimbursement, the total return would have been 5.67%.
H Total returns for periods of less than one year are not annualized.
I Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
J Fees and expenses of any 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.
K Expense ratios reflect operating expenses of the Fund. 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 Fund during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the Fund.
L Annualized
M Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
N Amount not annualized.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended October 31, 2016
1. Organization.
Fidelity Event Driven Opportunities Fund (the Fund) is a non-diversified fund of Fidelity Concord Street Trust (the Trust) (formerly a fund of Fidelity Commonwealth Trust) and is authorized to issue an unlimited number of shares. Share transactions on the Statement of Changes in Net Assets may contain exchanges between affiliated funds. 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.
2. Investments in Fidelity Central Funds.
The Fund invests in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser 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 the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website 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. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Trustees (the Board) has delegated the day to day responsibility for the valuation of the Fund's investments to the Fair Value Committee (the Committee) established by the Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, the Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment 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 Committee oversees the Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing the Fund's investments and ratifies the fair value determinations of the Committee.
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)
Valuation techniques used to value the Fund's investments by major category are as follows:
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing vendor 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 or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For foreign equity securities, when market or security specific events arise, comparisons to the valuation of American Depositary Receipts (ADRs), futures contracts, Exchange-Traded Funds (ETFs) and certain indexes as well as quoted prices for similar securities may be used and would be categorized as Level 2 in the hierarchy. Utilizing these techniques may result in transfers between Level 1 and Level 2. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Debt securities, including restricted securities, are valued based on evaluated prices received from third party pricing vendors or from brokers who make markets in such securities. U.S. government and government agency obligations are valued by pricing vendors who utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type or by broker-supplied prices. When independent prices are unavailable or unreliable, debt securities may be valued utilizing pricing methodologies which consider similar factors that would be used by third party pricing vendors. Debt securities are generally categorized as Level 2 in the hierarchy but may be Level 3 depending on the circumstances.
Futures contracts are valued at the settlement price established each day by the board of trade or exchange on which they are traded and are categorized as Level 1 in the hierarchy. Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
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 October 31, 2016 is included at the end of the Fund's Schedule of Investments.
Foreign Currency. The Fund may use 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 rates 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. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Distributions received on securities that represent a return of capital or capital gain are recorded as a reduction of cost of investments and/or as a realized gain. Subsequent to ex-dividend date the Fund determines the components of these distributions, based upon receipt of tax filings or other correspondence relating to the underlying investment. Interest income is accrued as earned and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.
Expenses. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. 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 under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. The Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction. Foreign taxes are provided for based on the Fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.
Distributions are declared and recorded on the ex-dividend date. 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. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to futures contracts, foreign currency transactions, market discount, capital loss carryforwards and losses deferred due to wash sales.
The federal tax cost of investment securities and unrealized appreciation (depreciation) as of period end were as follows:
Gross unrealized appreciation | $16,036,648 |
Gross unrealized depreciation | (17,136,961) |
Net unrealized appreciation (depreciation) on securities | $(1,100,313) |
Tax cost | $171,613,327 |
Capital loss carryforwards are only available to offset future capital gains of the Fund to the extent provided by regulations and may be limited. Under the Regulated Investment Company Modernization Act of 2010 (the Act), the Fund is permitted to carry forward capital losses incurred in taxable years beginning after December 22, 2010 for an unlimited period and such capital losses are required to be used prior to any losses that expire. The capital loss carryforward information presented below, including any applicable limitation, is estimated as of prior fiscal period end and is subject to adjustment.
No expiration | |
Long-term | $(3,665,346) |
4. Derivative Instruments.
Risk Exposures and the Use of Derivative Instruments. The Fund's investment objective allows the Fund to enter into various types of derivative contracts, including futures contracts. Derivatives are investments whose value is primarily derived from underlying assets, indices or reference rates and may be transacted on an exchange or over-the-counter (OTC). Derivatives may involve a future commitment to buy or sell a specified asset based on specified terms, to exchange future cash flows at periodic intervals based on a notional principal amount, or for one party to make one or more payments upon the occurrence of specified events in exchange for periodic payments from the other party.
The Fund used derivatives to increase returns and to manage exposure to certain risks as defined below. The success of any strategy involving derivatives depends on analysis of numerous economic factors, and if the strategies for investment do not work as intended, the Fund may not achieve its objectives.
The Fund's use of derivatives increased or decreased its exposure to the following risk:
Equity Risk | Equity risk relates to the fluctuations in the value of financial instruments as a result of changes in market prices (other than those arising from interest rate risk or foreign exchange risk), whether caused by factors specific to an individual investment, its issuer, or all factors affecting all instruments traded in a market or market segment. |
The Fund is also exposed to additional risks from investing in derivatives, such as liquidity risk and counterparty credit risk. Liquidity risk is the risk that the Fund will be unable to close out the derivative in the open market in a timely manner. Counterparty credit risk is the risk that the counterparty will not be able to fulfill its obligation to the Fund. Counterparty credit risk related to exchange-traded futures contracts may be mitigated by the protection provided by the exchange on which they trade.
Investing in derivatives may involve greater risks than investing in the underlying assets directly and, to varying degrees, may involve risk of loss in excess of any initial investment and collateral received and amounts recognized in the Statement of Assets and Liabilities. In addition, there may be the risk that the change in value of the derivative contract does not correspond to the change in value of the underlying instrument.
Futures Contracts. A futures contract is an agreement between two parties to buy or sell a specified underlying instrument for a fixed price at a specified future date. The Fund used futures contracts to manage its exposure to the stock market.
Upon entering into a futures contract, a fund is required to deposit either cash or securities (initial margin) with a clearing broker in an amount equal to a certain percentage of the face value of the contract. Futures contracts are marked-to-market daily and subsequent daily payments (variation margin) are made or received by a fund depending on the daily fluctuations in the value of the futures contracts and are recorded as unrealized appreciation or (depreciation). This receivable and/or payable, if any, is included in daily variation margin for derivative instruments in the Statement of Assets and Liabilities. Realized gain or (loss) is recorded upon the expiration or closing of a futures contract.
Any open futures contracts at period end are presented in the Schedule of Investments under the caption "Futures Contracts". The underlying face amount at value reflects each contract's exposure to the underlying instrument or index at period end. Securities deposited to meet initial margin requirements are identified in the Schedule of Investments.
During the period the Fund recognized net realized gain (loss) of $1,310,534 and a change in net unrealized appreciation (depreciation) of $(465,638) related to its investment in futures contracts. These amounts are included in the Statement of Operations.
5. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities, aggregated $84,771,556 and $81,261,311, respectively.
6. Fees and Other Transactions with Affiliates.
Management Fee. Fidelity Management & Research Company (the investment adviser) 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 .60% of the Fund's average net assets and an annualized group fee rate that averaged .25% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by the investment adviser, including any mutual funds previously advised by the investment adviser that are currently advised by Fidelity SelectCo, LLC, an affiliate of the investment adviser. The group fee rate decreases as assets under management increase and increases as assets under management decrease. In addition, the management fee is subject to a performance adjustment (up to a maximum of +/- .10% of the Fund's average net assets over a 36 month performance period). The upward or downward adjustment to the management fee is based on the Fund's relative investment performance as compared to its benchmark index, the Russell 3000 Index, over the same 36 month performance period. For the reporting period, the total annualized management fee rate, including the performance adjustment, was .80% of the Fund's average net assets. The performance adjustment included in the management fee rate may be higher or lower than the maximum performance adjustment rate due to the difference between the average net assets for the reporting and performance periods.
Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc. (FIIOC), an affiliate of the investment adviser, is the Fund's transfer, dividend disbursing and shareholder servicing agent. FIIOC receives account fees and asset-based fees that vary according to account size and type of account. FIIOC pays for typesetting, printing and mailing of shareholder reports, except proxy statements. For the period, the transfer agent fees were equivalent to an annualized rate of .16% of average net assets.
Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of the investment adviser, maintains the Fund's accounting records. The accounting fee is based on the level of average net assets for each 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.
Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. Brokerage commissions are included in net realized gain (loss) and change in net unrealized appreciation (depreciation) in the Statement of Operations. The commissions paid to these affiliated firms were $5,070 for the period.
Interfund Trades. The Fund may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
7. Committed Line of Credit.
The Fund participates with other funds managed by the investment adviser or an affiliate in a $4.25 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 $287 and is reflected in Miscellaneous expenses on the Statement of Operations. During the period, the Fund did not borrow on this line of credit.
8. Security Lending.
The Fund lends portfolio securities through a lending agent from time to time in order to earn additional income. For equity securities, a lending agent is used and may loan securities to certain qualified borrowers, including Fidelity Capital Markets (FCM), a broker-dealer affiliated with the Fund. On the settlement date of the loan, the Fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the Fund and any additional required collateral is delivered to the Fund on the next business day. The Fund or borrower may terminate the loan at any time, and if the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, the Fund may apply collateral received from the borrower against the obligation. The Fund may experience delays and costs in recovering the securities loaned. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. The value of securities loaned to FCM at period end was $391,045. Security lending income represents the income earned on investing cash collateral, less rebates paid to borrowers and any lending agent fees associated with the loan, plus any premium payments received for lending certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds, and includes $4,222 from securities loaned to FCM.
9. Expense Reductions.
Commissions paid to certain brokers with whom the investment adviser, or its affiliates, places trades on behalf of the Fund include an amount in addition to trade execution, which may be rebated back to the Fund to offset certain expenses. This amount totaled $17,303 for the period. In addition, through arrangements with the Fund's custodian, credits realized as a result of certain uninvested cash balances were used to reduce the Fund's expenses. During the period, these credits reduced the Fund's custody expenses by $53.
In addition, during the period the investment adviser reimbursed and/or waived a portion of operating expenses in the amount of $725.
10. 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.
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including management fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (May 1, 2016 to October 31, 2016).
Actual Expenses
The first line of the accompanying table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. 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 provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. 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.
Annualized Expense Ratio-A | Beginning Account Value May 1, 2016 | Ending Account Value October 31, 2016 | Expenses Paid During Period-B May 1, 2016 to October 31, 2016 | |
Actual | 1.05% | $1,000.00 | $1,029.80 | $5.37 |
Hypothetical-C | $1,000.00 | $1,019.91 | $5.35 |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to the Fund's annualized expense ratio, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).
C 5% return per year before expenses
Board Approval of Investment Advisory Contracts and Management Fees
Fidelity Event Driven Opportunities Fund
Each year, the Board of Trustees, including the Independent Trustees (together, the Board), votes on the renewal of the management contract with Fidelity Management & Research Company (FMR) and the sub-advisory agreements (together, the Advisory Contracts) for the fund. The Board, assisted by the advice of fund counsel and Independent Trustees' counsel, requests and considers a broad range of information relevant to the renewal of the Advisory Contracts throughout the year.
The Board meets regularly and, at each of its meetings, covers an extensive agenda of topics and materials and considers factors that are relevant to its annual consideration of the renewal of the fund's Advisory Contracts, including the services and support provided to the fund and its shareholders. The Board has established various standing committees (Committees), each composed of and chaired by Independent Trustees with varying backgrounds, to which the Board has assigned specific subject matter responsibilities in order to enhance effective decision-making by the Board. The Board, acting directly and through its Committees, requests and receives information concerning the annual consideration of the renewal of the fund's Advisory Contracts. The Board also meets as needed to consider matters specifically related to the Board's annual consideration of the renewal of the Advisory Contracts. Members of the Board may also meet with trustees of other Fidelity funds through ad hoc joint committees to discuss certain matters relevant to all of the Fidelity funds.
At its July 2016 meeting, the Board unanimously determined to renew the fund's Advisory Contracts. In reaching its determination, the Board considered all factors it believed relevant, including (i) the nature, extent, and quality of the services to be provided to the fund and its shareholders (including the investment performance of the fund); (ii) the competitiveness of the fund's management fee and total expense ratio relative to peer funds; (iii) the total costs of the services to be provided by and the profits to be realized by Fidelity from its relationships with the fund; and (iv) the extent to which, if any, economies of scale exist and would be realized as the fund grows, and whether any economies of scale are appropriately shared with fund shareholders.
In considering whether to renew the Advisory Contracts for the fund, the Board reached a determination, with the assistance of fund counsel and Independent Trustees' counsel and through the exercise of its business judgment, that the renewal of the Advisory Contracts was in the best interests of the fund and its shareholders and that the compensation payable under the Advisory Contracts was fair and reasonable. The Board's decision to renew the Advisory Contracts was not based on any single factor, but rather was based on a comprehensive consideration of all the information provided to the Board at its meetings throughout the year. The Board, in reaching its determination to renew the Advisory Contracts, was aware that shareholders of the fund have a broad range of investment choices available to them, including a wide choice among funds offered by Fidelity's competitors, and that the fund's shareholders, who have the opportunity to review and weigh the disclosure provided by the fund in its prospectus and other public disclosures, have chosen to invest in this fund, which is part of the Fidelity family of funds.
Nature, Extent, and Quality of Services Provided. The Board considered Fidelity's staffing as it relates to the fund, including the backgrounds of investment personnel of Fidelity, and also considered the fund's investment objective, strategies, and related investment philosophy. The Independent Trustees also had discussions with senior management of Fidelity's investment operations and investment groups. The Board considered the structure of the investment personnel compensation program and whether this structure provides appropriate incentives to act in the best interests of the fund. Additionally, the Board considered the portfolio managers' investments, if any, in the funds that they manage.Resources Dedicated to Investment Management and Support Services. The Board and the Fund Oversight and Research Committees reviewed the general qualifications and capabilities of Fidelity's investment staff, including its size, education, experience, and resources, as well as Fidelity's approach to recruiting, training, managing, and compensating investment personnel. The Board noted that Fidelity has continued to increase the resources devoted to non-U.S. offices, including expansion of Fidelity's global investment organization. The Board also noted that Fidelity's analysts have extensive resources, tools and capabilities that allow them to conduct sophisticated quantitative and fundamental analysis, as well as credit analysis of issuers, counterparties and guarantors. Further, the Board considered that Fidelity's investment professionals have sufficient access to global information and data so as to provide competitive investment results over time, and that those professionals also have access to sophisticated tools that permit them to assess portfolio construction and risk and performance attribution characteristics continuously, as well as to transmit new information and research conclusions rapidly around the world. Additionally, in its deliberations, the Board considered Fidelity's trading, risk management, compliance, and technology and operations capabilities and resources, which are integral parts of the investment management process.Shareholder and Administrative Services. The Board considered (i) the nature, extent, quality, and cost of advisory, administrative, and shareholder services performed by FMR, the sub-advisers (together with FMR, the Investment Advisers), and their affiliates under the Advisory Contracts and under separate agreements covering transfer agency, pricing and bookkeeping, and securities lending services for the fund; (ii) the nature and extent of the supervision of third party service providers, principally custodians, subcustodians, and pricing vendors; and (iii) the resources devoted to, and the record of compliance with, the fund's compliance policies and procedures. The Board also reviewed the allocation of fund brokerage, including allocations to brokers affiliated with the Investment Advisers, the use of brokerage commissions to pay fund expenses, and the use of "soft" commission dollars to pay for research services.The Board noted that the growth of fund assets over time across the complex allows Fidelity to reinvest in the development of services designed to enhance the value or convenience of the Fidelity funds as investment vehicles. These services include 24-hour access to account information and market information through telephone representatives and over the Internet, investor education materials and asset allocation tools, and the expanded availability of Fidelity Investor Centers.In 2014, the Board formed an ad hoc Committee on Transfer Agency Fees to review the variety of transfer agency fee structures throughout the industry and Fidelity's competitive positioning with respect to industry participants.Investment in a Large Fund Family. The Board considered the benefits to shareholders of investing in a Fidelity fund, including the benefits of investing in a fund that is part of a large family of funds offering a variety of investment disciplines and providing a large variety of mutual fund investor services. The Board noted that Fidelity had taken, or had made recommendations that resulted in the Fidelity funds taking, a number of actions over the previous year that benefited particular funds, including: (i) continuing to dedicate additional resources to investment research and to the support of the senior management team that oversees asset management; (ii) continuing efforts to enhance Fidelity's global research capabilities; (iii) launching new funds and making other enhancements to meet client needs; (iv) broadening eligibility requirements for certain lower-priced share classes of, and streamlining the fee structure for, certain existing equity index funds; (v) lowering expense caps for certain existing funds and classes to reduce expenses paid by shareholders; (vi) eliminating redemption fees for certain variable insurance product funds and classes; (vii) continuing to launch dedicated lower cost underlying funds to meet portfolio construction needs related to expanding underlying fund options for Fidelity funds of funds, specifically for the Freedom Fund product lines; (viii) launching a lower cost share class for use by the Freedom Index Fund product line; (ix) rationalizing product lines and gaining increased efficiencies through fund mergers and share class consolidations; (x) continuing to develop, acquire and implement systems and technology to improve services to the funds and shareholders, strengthen information security, and increase efficiency; (xi) implementing investment enhancements to further strengthen Fidelity's target date product line to increase investors' probability of success in achieving their goals; (xii) accelerating the conversion of all remaining Class B shares to Class A shares, which have a lower expense structure; and (xiii) implementing changes to Fidelity's money market fund product line in response to recent regulatory reforms.Investment Performance. The Board considered whether the fund has operated in accordance with its investment objective, as well as its record of compliance with its investment restrictions and its performance history.The Board took into account discussions with representatives of the Investment Advisers about fund investment performance that occur at Board meetings throughout the year. In this regard the Board noted that as part of regularly scheduled fund reviews and other reports to the Board on fund performance, the Board considers annualized return information for the fund, for different time periods, measured against a securities market index ("benchmark index") and a peer group of funds with similar objectives ("peer group"), if any. In its evaluation of fund investment performance, the Board gave particular attention to information indicating changes in performance of certain Fidelity funds for specific time periods and discussed with the Investment Advisers the reasons for any overperformance or underperformance.In addition to reviewing absolute and relative fund performance, the Independent Trustees periodically consider the appropriateness of fund performance metrics in evaluating the results achieved. In general, the Independent Trustees believe that fund performance should be evaluated based on net performance (after fees and expenses) of both the highest performing and lowest performing fund share classes, where applicable, compared to appropriate benchmark indices, over appropriate time periods that may include full market cycles, and compared to peer groups, as applicable, over the same periods, taking into account relevant factors including the following: general market conditions; issuer-specific information; and fund cash flows and other factors.The Independent Trustees recognize that shareholders evaluate performance on a net basis over their own holding periods, for which one-, three-, and five-year periods are often used as a proxy. For this reason, the performance information reviewed by the Board also included net cumulative calendar year total return information for the fund and an appropriate benchmark index for the most recent one-year period, as shown below. A peer group is not shown below because the fund does not generally utilize a peer group for performance comparison purposes.Fidelity Event Driven Opportunities Fund
Fidelity Event Driven Opportunities Fund
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Fidelity® Large Cap Stock Fund Semi-Annual Report October 31, 2016 |
Contents
Board Approval of Investment Advisory Contracts and Management Fees |
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 1-800-544-8544 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third-party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. © 2016 FMR LLC. All rights reserved.
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, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Fund nor Fidelity Distributors Corporation is a bank.
Investment Summary (Unaudited)
Top Ten Stocks as of October 31, 2016
% of fund's net assets | % of fund's net assets 6 months ago | |
JPMorgan Chase & Co. | 3.4 | 3.6 |
Apple, Inc. | 3.3 | 2.5 |
Bank of America Corp. | 3.2 | 2.9 |
Microsoft Corp. | 3.0 | 2.6 |
Citigroup, Inc. | 2.6 | 2.4 |
General Electric Co. | 2.6 | 3.1 |
Qualcomm, Inc. | 2.3 | 1.8 |
Procter & Gamble Co. | 2.0 | 1.9 |
Alphabet, Inc. Class A | 1.9 | 1.7 |
The Williams Companies, Inc. | 1.9 | 1.0 |
26.2 |
Top Five Market Sectors as of October 31, 2016
% of fund's net assets | % of fund's net assets 6 months ago | |
Financials | 21.8 | 20.6 |
Information Technology | 20.6 | 21.0 |
Health Care | 13.8 | 12.9 |
Energy | 13.2 | 13.3 |
Industrials | 11.4 | 12.8 |
Prior period industry classifications reflect the categories in place as of the date indicated and have not been adjusted to reflect current industry classifications.
Asset Allocation (% of fund's net assets)
As of October 31, 2016* | ||
Stocks | 98.9% | |
Short-Term Investments and Net Other Assets (Liabilities) | 1.1% |
* Foreign investments - 9.4%
As of April 30, 2016 * | ||
Stocks | 99.9% | |
Short-Term Investments and Net Other Assets (Liabilities) | 0.1% |
* Foreign investments - 9.6%
Investments October 31, 2016 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 98.9% | |||
Shares | Value (000s) | ||
CONSUMER DISCRETIONARY - 8.2% | |||
Auto Components - 0.0% | |||
Adient PLC (a) | 7,287 | $332 | |
Automobiles - 0.0% | |||
General Motors Co. | 19,900 | 629 | |
Hotels, Restaurants & Leisure - 0.4% | |||
Las Vegas Sands Corp. | 42,900 | 2,483 | |
Yum! Brands, Inc. | 97,588 | 8,420 | |
10,903 | |||
Household Durables - 0.6% | |||
KB Home | 650,000 | 9,451 | |
Taylor Morrison Home Corp. (a) | 301,182 | 5,138 | |
14,589 | |||
Leisure Products - 0.1% | |||
NJOY, Inc. (a)(b) | 871,001 | 0 | |
Polaris Industries, Inc. | 36,100 | 2,766 | |
2,766 | |||
Media - 5.0% | |||
AMC Networks, Inc. Class A (a) | 115,600 | 5,656 | |
Comcast Corp. Class A | 644,513 | 39,844 | |
Scripps Networks Interactive, Inc. Class A | 228,800 | 14,726 | |
Sinclair Broadcast Group, Inc. Class A | 172,300 | 4,325 | |
The Walt Disney Co. | 67,000 | 6,210 | |
Time Warner, Inc. | 447,941 | 39,862 | |
Viacom, Inc. Class B (non-vtg.) | 365,900 | 13,743 | |
124,366 | |||
Multiline Retail - 1.3% | |||
Target Corp. | 466,719 | 32,078 | |
Specialty Retail - 0.8% | |||
Lowe's Companies, Inc. | 317,370 | 21,153 | |
TOTAL CONSUMER DISCRETIONARY | 206,816 | ||
CONSUMER STAPLES - 5.3% | |||
Beverages - 1.6% | |||
Diageo PLC | 363,770 | 9,682 | |
The Coca-Cola Co. | 699,975 | 29,679 | |
39,361 | |||
Food & Staples Retailing - 1.1% | |||
CVS Health Corp. | 211,189 | 17,761 | |
Kroger Co. | 21,800 | 675 | |
Walgreens Boots Alliance, Inc. | 87,395 | 7,230 | |
Whole Foods Market, Inc. | 115,000 | 3,253 | |
28,919 | |||
Food Products - 0.3% | |||
Amplify Snack Brands, Inc. (a) | 76,500 | 1,108 | |
Mead Johnson Nutrition Co. Class A | 100,700 | 7,529 | |
8,637 | |||
Household Products - 2.0% | |||
Procter & Gamble Co. | 571,768 | 49,629 | |
Tobacco - 0.3% | |||
Reynolds American, Inc. | 126,500 | 6,968 | |
TOTAL CONSUMER STAPLES | 133,514 | ||
ENERGY - 13.2% | |||
Energy Equipment & Services - 1.4% | |||
Baker Hughes, Inc. | 193,200 | 10,703 | |
Ensco PLC Class A | 116,650 | 912 | |
National Oilwell Varco, Inc. | 323,718 | 10,391 | |
Oceaneering International, Inc. | 293,300 | 6,981 | |
Schlumberger Ltd. | 56,245 | 4,400 | |
Utica Shale Drilling Program (non-operating revenue interest) unit (b)(c) | 2,322,586 | 2,323 | |
35,710 | |||
Oil, Gas & Consumable Fuels - 11.8% | |||
Amyris, Inc. (a)(d) | 1,382,718 | 1,424 | |
Anadarko Petroleum Corp. | 147,900 | 8,791 | |
Apache Corp. | 354,540 | 21,088 | |
Cabot Oil & Gas Corp. | 402,200 | 8,398 | |
Cenovus Energy, Inc. | 924,600 | 13,339 | |
Chevron Corp. | 396,357 | 41,518 | |
ConocoPhillips Co. | 850,900 | 36,972 | |
Devon Energy Corp. | 34,500 | 1,307 | |
Golar LNG Ltd. | 112,000 | 2,452 | |
Imperial Oil Ltd. | 536,800 | 17,409 | |
Kinder Morgan, Inc. | 1,125,800 | 23,000 | |
Legacy Reserves LP | 187,362 | 300 | |
Noble Energy, Inc. | 39,600 | 1,365 | |
SM Energy Co. | 196,000 | 6,591 | |
Suncor Energy, Inc. | 1,344,600 | 40,349 | |
Teekay Offshore Partners LP | 175,797 | 1,051 | |
The Williams Companies, Inc. | 1,633,141 | 47,688 | |
Williams Partners LP | 606,100 | 21,711 | |
294,753 | |||
TOTAL ENERGY | 330,463 | ||
FINANCIALS - 21.8% | |||
Banks - 14.4% | |||
Bank of America Corp. | 4,795,650 | 79,128 | |
Citigroup, Inc. | 1,350,658 | 66,385 | |
Comerica, Inc. | 289,100 | 15,059 | |
JPMorgan Chase & Co. | 1,228,171 | 85,058 | |
PNC Financial Services Group, Inc. | 128,020 | 12,239 | |
Regions Financial Corp. | 1,842,600 | 19,734 | |
Standard Chartered PLC (United Kingdom) | 762,758 | 6,646 | |
SunTrust Banks, Inc. | 609,992 | 27,590 | |
U.S. Bancorp | 633,885 | 28,373 | |
Wells Fargo & Co. | 438,550 | 20,178 | |
360,390 | |||
Capital Markets - 5.7% | |||
Charles Schwab Corp. | 479,486 | 15,200 | |
Goldman Sachs Group, Inc. | 19,900 | 3,547 | |
Gores Holdings, Inc. | 211,600 | 2,410 | |
KKR & Co. LP | 691,798 | 9,817 | |
Morgan Stanley | 836,107 | 28,068 | |
Northern Trust Corp. | 323,006 | 23,392 | |
State Street Corp. | 615,042 | 43,182 | |
The Blackstone Group LP | 688,900 | 17,243 | |
142,859 | |||
Diversified Financial Services - 0.1% | |||
KKR Renaissance Co-Invest LP unit (a)(b) | 20,500 | 3,066 | |
Insurance - 0.5% | |||
MetLife, Inc. | 184,210 | 8,651 | |
Principal Financial Group, Inc. | 80,000 | 4,368 | |
13,019 | |||
Thrifts & Mortgage Finance - 1.1% | |||
MGIC Investment Corp. (a) | 827,992 | 6,756 | |
Radian Group, Inc. | 1,546,890 | 21,022 | |
27,778 | |||
TOTAL FINANCIALS | 547,112 | ||
HEALTH CARE - 13.8% | |||
Biotechnology - 3.4% | |||
Alexion Pharmaceuticals, Inc. (a) | 83,400 | 10,884 | |
Alnylam Pharmaceuticals, Inc. (a) | 32,100 | 1,143 | |
Amgen, Inc. | 102,303 | 14,441 | |
Biogen, Inc. (a) | 55,700 | 15,606 | |
BioMarin Pharmaceutical, Inc. (a) | 61,800 | 4,976 | |
Celldex Therapeutics, Inc. (a) | 10,500 | 33 | |
Genocea Biosciences, Inc. (a) | 42,900 | 148 | |
Gilead Sciences, Inc. | 145,300 | 10,698 | |
Insmed, Inc. (a) | 132,544 | 1,720 | |
Intercept Pharmaceuticals, Inc. (a) | 127,248 | 15,746 | |
Regeneron Pharmaceuticals, Inc. (a) | 4,800 | 1,656 | |
Spark Therapeutics, Inc. (a) | 50,000 | 2,351 | |
Vertex Pharmaceuticals, Inc. (a) | 90,000 | 6,827 | |
Windtree Therapeutics, Inc. (a) | 77,003 | 140 | |
86,369 | |||
Health Care Equipment & Supplies - 3.5% | |||
Abbott Laboratories | 248,675 | 9,758 | |
Alere, Inc. (a) | 315,800 | 14,110 | |
Boston Scientific Corp. (a) | 1,504,927 | 33,108 | |
Medtronic PLC | 200,300 | 16,429 | |
NxStage Medical, Inc. (a) | 216,200 | 4,916 | |
Zeltiq Aesthetics, Inc. (a) | 6,600 | 218 | |
Zimmer Biomet Holdings, Inc. | 80,100 | 8,443 | |
86,982 | |||
Health Care Providers & Services - 1.3% | |||
Anthem, Inc. | 13,100 | 1,596 | |
Cigna Corp. | 67,900 | 8,069 | |
Express Scripts Holding Co. (a) | 118,767 | 8,005 | |
McKesson Corp. | 123,604 | 15,719 | |
33,389 | |||
Health Care Technology - 0.0% | |||
Castlight Health, Inc. Class B (a) | 84,200 | 366 | |
Life Sciences Tools & Services - 0.4% | |||
Agilent Technologies, Inc. | 240,200 | 10,466 | |
Pharmaceuticals - 5.2% | |||
Allergan PLC (a) | 24,013 | 5,017 | |
AstraZeneca PLC sponsored ADR | 133,100 | 3,769 | |
Bayer AG | 2,500 | 248 | |
Bristol-Myers Squibb Co. | 253,400 | 12,901 | |
GlaxoSmithKline PLC sponsored ADR | 909,311 | 36,382 | |
Jazz Pharmaceuticals PLC (a) | 98,593 | 10,793 | |
Johnson & Johnson | 221,710 | 25,716 | |
Novartis AG sponsored ADR | 3,100 | 220 | |
Sanofi SA | 26,783 | 2,084 | |
Teva Pharmaceutical Industries Ltd. sponsored ADR | 660,801 | 28,243 | |
TherapeuticsMD, Inc. (a) | 743,200 | 4,266 | |
129,639 | |||
TOTAL HEALTH CARE | 347,211 | ||
INDUSTRIALS - 11.4% | |||
Aerospace & Defense - 1.5% | |||
General Dynamics Corp. | 10,500 | 1,583 | |
KEYW Holding Corp. (a) | 52,618 | 552 | |
The Boeing Co. | 120,437 | 17,154 | |
United Technologies Corp. | 171,778 | 17,556 | |
36,845 | |||
Air Freight & Logistics - 1.5% | |||
C.H. Robinson Worldwide, Inc. | 21,800 | 1,485 | |
FedEx Corp. | 71,700 | 12,499 | |
United Parcel Service, Inc. Class B | 209,575 | 22,584 | |
36,568 | |||
Building Products - 0.1% | |||
Tyco International Ltd. | 72,873 | 2,938 | |
Commercial Services & Supplies - 0.1% | |||
Stericycle, Inc. (a) | 44,700 | 3,580 | |
Electrical Equipment - 1.1% | |||
AMETEK, Inc. | 252,670 | 11,143 | |
Emerson Electric Co. | 131,900 | 6,685 | |
Hubbell, Inc. Class B | 49,700 | 5,195 | |
Melrose Industries PLC | 1,880,837 | 3,885 | |
26,908 | |||
Industrial Conglomerates - 2.6% | |||
General Electric Co. | 2,241,898 | 65,239 | |
Machinery - 1.3% | |||
Colfax Corp. (a) | 57,400 | 1,825 | |
Deere & Co. | 103,800 | 9,166 | |
Flowserve Corp. | 114,100 | 4,832 | |
Ingersoll-Rand PLC | 84,971 | 5,718 | |
Rexnord Corp. (a) | 351,100 | 6,983 | |
Wabtec Corp. | 48,300 | 3,734 | |
Xylem, Inc. | 28,300 | 1,368 | |
33,626 | |||
Professional Services - 0.3% | |||
Acacia Research Corp. (a) | 24,000 | 140 | |
IHS Markit Ltd. (a) | 53,140 | 1,955 | |
Verisk Analytics, Inc. (a) | 81,730 | 6,665 | |
8,760 | |||
Road & Rail - 2.8% | |||
Celadon Group, Inc. | 27,200 | 177 | |
CSX Corp. | 748,799 | 22,846 | |
Genesee & Wyoming, Inc. Class A (a) | 175,100 | 11,896 | |
J.B. Hunt Transport Services, Inc. | 135,600 | 11,066 | |
Kansas City Southern | 89,300 | 7,837 | |
Norfolk Southern Corp. | 71,242 | 6,626 | |
Old Dominion Freight Lines, Inc. (a) | 80,300 | 5,997 | |
Union Pacific Corp. | 41,800 | 3,686 | |
70,131 | |||
Trading Companies & Distributors - 0.1% | |||
United Rentals, Inc. (a) | 18,400 | 1,392 | |
TOTAL INDUSTRIALS | 285,987 | ||
INFORMATION TECHNOLOGY - 20.6% | |||
Communications Equipment - 1.7% | |||
Cisco Systems, Inc. | 1,393,561 | 42,754 | |
Internet Software & Services - 4.4% | |||
Alphabet, Inc.: | |||
Class A | 60,187 | 48,745 | |
Class C (a) | 52,178 | 40,936 | |
Facebook, Inc. Class A (a) | 165,400 | 21,666 | |
111,347 | |||
IT Services - 4.2% | |||
Cognizant Technology Solutions Corp. Class A (a) | 95,416 | 4,900 | |
First Data Corp. Class A (a) | 855,016 | 11,962 | |
MasterCard, Inc. Class A | 283,000 | 30,287 | |
Paychex, Inc. | 134,939 | 7,449 | |
PayPal Holdings, Inc. (a) | 134,700 | 5,612 | |
Unisys Corp. (a)(d) | 654,895 | 6,844 | |
Visa, Inc. Class A | 461,180 | 38,052 | |
105,106 | |||
Semiconductors & Semiconductor Equipment - 2.4% | |||
Maxim Integrated Products, Inc. | 74,600 | 2,956 | |
Qualcomm, Inc. | 823,050 | 56,560 | |
59,516 | |||
Software - 4.1% | |||
Adobe Systems, Inc. (a) | 83,590 | 8,987 | |
Autodesk, Inc. (a) | 168,969 | 12,213 | |
Microsoft Corp. | 1,259,696 | 75,481 | |
Mobileye NV (a) | 75,900 | 2,822 | |
Salesforce.com, Inc. (a) | 37,200 | 2,796 | |
102,299 | |||
Technology Hardware, Storage & Peripherals - 3.8% | |||
Apple, Inc. | 719,329 | 81,673 | |
Western Digital Corp. | 225,800 | 13,196 | |
94,869 | |||
TOTAL INFORMATION TECHNOLOGY | 515,891 | ||
MATERIALS - 3.3% | |||
Chemicals - 2.6% | |||
CF Industries Holdings, Inc. | 220,400 | 5,292 | |
E.I. du Pont de Nemours & Co. | 87,938 | 6,049 | |
Intrepid Potash, Inc. (a) | 556,105 | 578 | |
LyondellBasell Industries NV Class A | 99,695 | 7,931 | |
Monsanto Co. | 274,573 | 27,669 | |
Potash Corp. of Saskatchewan, Inc. | 662,000 | 10,764 | |
W.R. Grace & Co. | 106,700 | 7,145 | |
65,428 | |||
Containers & Packaging - 0.5% | |||
WestRock Co. | 270,569 | 12,498 | |
Metals & Mining - 0.2% | |||
Freeport-McMoRan, Inc. | 373,600 | 4,177 | |
TOTAL MATERIALS | 82,103 | ||
REAL ESTATE - 0.1% | |||
Equity Real Estate Investment Trusts (REITs) - 0.1% | |||
Crown Castle International Corp. | 2,900 | 264 | |
Public Storage | 5,400 | 1,154 | |
1,418 | |||
TELECOMMUNICATION SERVICES - 0.3% | |||
Diversified Telecommunication Services - 0.3% | |||
Verizon Communications, Inc. | 175,300 | 8,432 | |
UTILITIES - 0.9% | |||
Electric Utilities - 0.7% | |||
Exelon Corp. | 498,200 | 16,974 | |
Independent Power and Renewable Electricity Producers - 0.2% | |||
Dynegy, Inc. (a) | 520,700 | 5,545 | |
TOTAL UTILITIES | 22,519 | ||
TOTAL COMMON STOCKS | |||
(Cost $2,002,715) | 2,481,466 | ||
Principal Amount (000s) | Value (000s) | ||
Convertible Bonds - 0.0% | |||
ENERGY - 0.0% | |||
Oil, Gas & Consumable Fuels - 0.0% | |||
Amyris, Inc.: | |||
5% 10/15/18 pay-in-kind (b)(e) | 1,045 | 568 | |
9.5% 4/15/19 pay-in-kind (e) | 639 | 463 | |
TOTAL CONVERTIBLE BONDS | |||
(Cost $1,684) | 1,031 | ||
Shares | Value (000s) | ||
Money Market Funds - 1.1% | |||
Fidelity Cash Central Fund, 0.41% (f) | 24,619,660 | 24,627 | |
Fidelity Securities Lending Cash Central Fund 0.48% (f)(g) | 2,060,997 | 2,061 | |
TOTAL MONEY MARKET FUNDS | |||
(Cost $26,685) | 26,688 | ||
TOTAL INVESTMENT PORTFOLIO - 100.0% | |||
(Cost $2,031,084) | 2,509,185 | ||
NET OTHER ASSETS (LIABILITIES) - 0.0% | 817 | ||
NET ASSETS - 100% | $2,510,002 |
Values shown as $0 may reflect amounts less than $500.
Legend
(a) Non-income producing
(b) Restricted securities - Investment in securities not registered under the Securities Act of 1933 (excluding 144A issues). At the end of the period, the value of restricted securities (excluding 144A issues) amounted to $5,957,000 or 0.2% of net assets.
(c) Investment is owned by a wholly-owned subsidiary (Subsidiary) that is treated as a corporation for U.S. tax purposes.
(d) Security or a portion of the security is on loan at period end.
(e) Coupon rates for floating and adjustable rate securities reflect the rates in effect at period end.
(f) Affiliated fund that is generally 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. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
(g) Investment made with cash collateral received from securities on loan.
Additional information on each restricted holding is as follows:
Security | Acquisition Date | Acquisition Cost (000s) |
Amyris, Inc. 5% 10/15/18 pay-in-kind | 10/16/13 - 10/17/16 | $1,045 |
KKR Renaissance Co-Invest LP unit | 7/25/13 | $2,163 |
NJOY, Inc. | 6/7/13 - 2/14/14 | $2,381 |
Utica Shale Drilling Program (non-operating revenue interest) unit | 10/5/16 | $2,323 |
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 |
(Amounts in thousands) | |
Fidelity Cash Central Fund | $10 |
Fidelity Securities Lending Cash Central Fund | 125 |
Total | $135 |
Investment Valuation
The following is a summary of the inputs used, as of October 31, 2016, involving the Fund's assets and liabilities carried at fair 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 below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
Valuation Inputs at Reporting Date: | ||||
Description | Total | Level 1 | Level 2 | Level 3 |
(Amounts in thousands) | ||||
Investments in Securities: | ||||
Equities: | ||||
Consumer Discretionary | $206,816 | $206,816 | $-- | $-- |
Consumer Staples | 133,514 | 123,832 | 9,682 | -- |
Energy | 330,463 | 328,140 | -- | 2,323 |
Financials | 547,112 | 544,046 | -- | 3,066 |
Health Care | 347,211 | 344,879 | 2,332 | -- |
Industrials | 285,987 | 285,987 | -- | -- |
Information Technology | 515,891 | 515,891 | -- | -- |
Materials | 82,103 | 82,103 | -- | -- |
Real Estate | 1,418 | 1,418 | -- | -- |
Telecommunication Services | 8,432 | 8,432 | -- | -- |
Utilities | 22,519 | 22,519 | -- | -- |
Corporate Bonds | 1,031 | -- | 463 | 568 |
Money Market Funds | 26,688 | 26,688 | -- | -- |
Total Investments in Securities: | $2,509,185 | $2,490,751 | $12,477 | $5,957 |
See accompanying notes which are an integral part of the financial statements.
Financial Statements
Statement of Assets and Liabilities
Amounts in thousands (except per-share amount) | October 31, 2016 (Unaudited) | |
Assets | ||
Investment in securities, at value (including securities loaned of $1,842) — See accompanying schedule: Unaffiliated issuers (cost $2,004,399) | $2,482,497 | |
Fidelity Central Funds (cost $26,685) | 26,688 | |
Total Investments (cost $2,031,084) | $2,509,185 | |
Receivable for investments sold | 19,228 | |
Receivable for fund shares sold | 1,112 | |
Dividends receivable | 1,932 | |
Interest receivable | 76 | |
Distributions receivable from Fidelity Central Funds | 19 | |
Prepaid expenses | 7 | |
Other receivables | 7 | |
Total assets | 2,531,566 | |
Liabilities | ||
Payable for investments purchased | $15,174 | |
Payable for fund shares redeemed | 2,960 | |
Accrued management fee | 883 | |
Other affiliated payables | 441 | |
Other payables and accrued expenses | 45 | |
Collateral on securities loaned, at value | 2,061 | |
Total liabilities | 21,564 | |
Net Assets | $2,510,002 | |
Net Assets consist of: | ||
Paid in capital | $1,995,064 | |
Undistributed net investment income | 19,134 | |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | 17,712 | |
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies | 478,092 | |
Net Assets, for 90,484 shares outstanding | $2,510,002 | |
Net Asset Value, offering price and redemption price per share ($2,510,002 ÷ 90,484 shares) | $27.74 |
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Amounts in thousands | Six months ended October 31, 2016 (Unaudited) | |
Investment Income | ||
Dividends | $26,392 | |
Interest | 101 | |
Income from Fidelity Central Funds | 135 | |
Total income | 26,628 | |
Expenses | ||
Management fee | ||
Basic fee | $6,912 | |
Performance adjustment | (2,204) | |
Transfer agent fees | 2,292 | |
Accounting and security lending fees | 377 | |
Custodian fees and expenses | 31 | |
Independent trustees' fees and expenses | 5 | |
Registration fees | 27 | |
Audit | 28 | |
Legal | 7 | |
Interest | 7 | |
Miscellaneous | 14 | |
Total expenses before reductions | 7,496 | |
Expense reductions | (30) | 7,466 |
Net investment income (loss) | 19,162 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | 34,725 | |
Fidelity Central Funds | 3 | |
Foreign currency transactions | (2) | |
Total net realized gain (loss) | 34,726 | |
Change in net unrealized appreciation (depreciation) on: Investment securities | 92,390 | |
Assets and liabilities in foreign currencies | (4) | |
Total change in net unrealized appreciation (depreciation) | 92,386 | |
Net gain (loss) | 127,112 | |
Net increase (decrease) in net assets resulting from operations | $146,274 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Amounts in thousands | Six months ended October 31, 2016 (Unaudited) | Year ended April 30, 2016 |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $19,162 | $39,509 |
Net realized gain (loss) | 34,726 | 78,527 |
Change in net unrealized appreciation (depreciation) | 92,386 | (302,563) |
Net increase (decrease) in net assets resulting from operations | 146,274 | (184,527) |
Distributions to shareholders from net investment income | (13,649) | (33,715) |
Distributions to shareholders from net realized gain | (28,057) | (103,844) |
Total distributions | (41,706) | (137,559) |
Share transactions | ||
Proceeds from sales of shares | 141,367 | 560,790 |
Reinvestment of distributions | 40,427 | 133,799 |
Cost of shares redeemed | (356,087) | (1,000,244) |
Net increase (decrease) in net assets resulting from share transactions | (174,293) | (305,655) |
Total increase (decrease) in net assets | (69,725) | (627,741) |
Net Assets | ||
Beginning of period | 2,579,727 | 3,207,468 |
End of period | $2,510,002 | $2,579,727 |
Other Information | ||
Undistributed net investment income end of period | $19,134 | $13,621 |
Shares | ||
Sold | 5,185 | 20,614 |
Issued in reinvestment of distributions | 1,538 | 4,813 |
Redeemed | (13,159) | (38,055) |
Net increase (decrease) | (6,436) | (12,628) |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Large Cap Stock Fund
Six months ended (Unaudited) October 31, | Years ended April 30, | |||||
2016 | 2016 | 2015 | 2014 | 2013 | 2012 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $26.62 | $29.28 | $27.76 | $23.17 | $19.55 | $19.10 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .21 | .37 | .31 | .28 | .25 | .16 |
Net realized and unrealized gain (loss) | 1.35 | (1.74) | 2.92 | 5.48 | 3.58 | .46 |
Total from investment operations | 1.56 | (1.37) | 3.23 | 5.76 | 3.83 | .62 |
Distributions from net investment income | (.14) | (.32) | (.27) | (.21) | (.20) | (.15) |
Distributions from net realized gain | (.30) | (.97) | (1.44) | (.96) | (.01) | (.03) |
Total distributions | (.44) | (1.29) | (1.71) | (1.17) | (.21) | (.17)B |
Net asset value, end of period | $27.74 | $26.62 | $29.28 | $27.76 | $23.17 | $19.55 |
Total ReturnC,D | 5.95% | (4.82)% | 11.97% | 25.53% | 19.74% | 3.40% |
Ratios to Average Net AssetsE,F | ||||||
Expenses before reductions | .59%G | .78% | .88% | .88% | .85% | 1.03% |
Expenses net of fee waivers, if any | .59%G | .77% | .88% | .88% | .85% | 1.03% |
Expenses net of all reductions | .59%G | .77% | .88% | .88% | .84% | 1.02% |
Net investment income (loss) | 1.52%G | 1.38% | 1.10% | 1.08% | 1.21% | .88% |
Supplemental Data | ||||||
Net assets, end of period (in millions) | $2,510 | $2,580 | $3,207 | $2,796 | $1,488 | $951 |
Portfolio turnover rateH | 25%G | 31% | 36%I | 31% | 53% | 64% |
A Calculated based on average shares outstanding during the period.
B Total distributions of $.17 per share is comprised of distributions from net investment income of $.147 and distributions from net realized gain of $.027 per share.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Fees and expenses of any 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 Expense ratios reflect operating expenses of the Fund. 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 Fund during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the Fund.
G Annualized
H Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
I Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended October 31, 2016
(Amounts in thousands except percentages)
1. Organization.
Fidelity Large Cap Stock Fund (the Fund) is a fund of Fidelity Concord Street Trust (the Trust) (formerly a fund of Fidelity Commonwealth Trust) and is authorized to issue an unlimited number of shares. Share transactions on the Statement of Changes in Net Assets may contain exchanges between affiliated funds. 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.
2. Investments in Fidelity Central Funds.
The Fund invests in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser 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 the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website 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. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Trustees (the Board) has delegated the day to day responsibility for the valuation of the Fund's investments to the Fair Value Committee (the Committee) established by the Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, the Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment 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 Committee oversees the Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing the Fund's investments and ratifies the fair value determinations of the Committee.
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)
Valuation techniques used to value the Fund's investments by major category are as follows:
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing vendor 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 or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For foreign equity securities, when market or security specific events arise, comparisons to the valuation of American Depositary Receipts (ADRs), futures contracts, Exchange-Traded Funds (ETFs) and certain indexes as well as quoted prices for similar securities may be used and would be categorized as Level 2 in the hierarchy. Utilizing these techniques may result in transfers between Level 1 and Level 2. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Debt securities, including restricted securities, are valued based on evaluated prices received from third party pricing vendors or from brokers who make markets in such securities. Corporate bonds are valued by pricing vendors who utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type or by broker-supplied prices. When independent prices are unavailable or unreliable, debt securities may be valued utilizing pricing methodologies which consider similar factors that would be used by third party pricing vendors. Debt securities are generally categorized as Level 2 in the hierarchy but may be Level 3 depending on the circumstances.
Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
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 October 31, 2016 is included at the end of the Fund's Schedule of Investments.
Foreign Currency. The Fund may use 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 rates 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 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. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Distributions received on securities that represent a return of capital or capital gain are recorded as a reduction of cost of investments and/or as a realized gain. Subsequent to ex-dividend date the Fund determines the components of these distributions, based upon receipt of tax filings or other correspondence relating to the underlying investment. Interest income is accrued as earned and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.
Expenses. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. 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 under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. The Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction. Foreign taxes are provided for based on the Fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.
Distributions are declared and recorded on the ex-dividend date. 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. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to foreign currency transactions, partnerships and losses deferred due to wash sales.
The federal tax cost of investment securities and unrealized appreciation (depreciation) as of period end were as follows:
Gross unrealized appreciation | $614,870 |
Gross unrealized depreciation | (149,491) |
Net unrealized appreciation (depreciation) on securities | $465,379 |
Tax cost | $2,043,806 |
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.
Consolidated Subsidiary. The Fund invests in certain investments through a wholly-owned subsidiary ("Subsidiary"), which may be subject to federal and state taxes upon disposition.
As of period end, the Fund held an investment of $2,323 in these Subsidiaries, representing .09% of the Fund's net assets. The financial statements have been consolidated and include accounts of the Fund and each Subsidiary. Accordingly, all inter-company transactions and balances have been eliminated.
4. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities, aggregated $314,024 and $534,204, respectively.
5. Fees and Other Transactions with Affiliates.
Management Fee. Fidelity Management & Research Company (the investment adviser) and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .30% of the Fund's average net assets and an annualized group fee rate that averaged .25% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by the investment adviser, including any mutual funds previously advised by the investment adviser that are currently advised by Fidelity SelectCo, LLC, an affiliate of the investment adviser. The group fee rate decreases as assets under management increase and increases as assets under management decrease. In addition, the management fee is subject to a performance adjustment (up to a maximum of +/- .20% of the Fund's average net assets over a 36 month performance period). The upward or downward adjustment to the management fee is based on the Fund's relative investment performance as compared to its benchmark index, the S&P 500 Index, over the same 36 month performance period. For the reporting period, the total annualized management fee rate, including the performance adjustment, was .37% of the Fund's average net assets. The performance adjustment included in the management fee rate may be higher or lower than the maximum performance adjustment rate due to the difference between the average net assets for the reporting and performance periods.
Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc. (FIIOC), an affiliate of the investment adviser, is the Fund's transfer, dividend disbursing and shareholder servicing agent. FIIOC receives account fees and asset-based fees that vary according to account size and type of account. FIIOC pays for typesetting, printing and mailing of shareholder reports, except proxy statements. For the period, the transfer agent fees were equivalent to an annualized rate of .18% of average net assets.
Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of the investment adviser, maintains the Fund's accounting records. The accounting fee is based on the level of average net assets for each 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.
Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. Brokerage commissions are included in net realized gain (loss) and change in net unrealized appreciation (depreciation) in the Statement of Operations. The commissions paid to these affiliated firms were $13 for the period.
Interfund Lending Program. Pursuant to an Exemptive Order issued by the SEC, the Fund, along with other registered investment companies having management contracts with Fidelity Management & Research Company (FMR) or other affiliated entities of FMR, may participate in an interfund lending program. This program provides an alternative credit facility allowing the funds to borrow from, or lend money to, other participating affiliated funds. At period end, there were no interfund loans outstanding. The Fund's activity in this program during the period for which loans were outstanding was as follows:
Borrower or Lender | Average Loan Balance | Weighted Average Interest Rate | Interest Expense |
Borrower | $5,815 | .60% | $6 |
Interfund Trades. The Fund may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
6. Committed Line of Credit.
The Fund participates with other funds managed by the investment adviser or an affiliate in a $4.25 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 $4 and is reflected in Miscellaneous expenses on the Statement of Operations. During the period, the Fund did not borrow on this line of credit.
7. Security Lending.
The Fund lends portfolio securities through a lending agent from time to time in order to earn additional income. For equity securities, a lending agent is used and may loan securities to certain qualified borrowers, including Fidelity Capital Markets (FCM), a broker-dealer affiliated with the Fund. On the settlement date of the loan, the Fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the Fund and any additional required collateral is delivered to the Fund on the next business day. The Fund or borrower may terminate the loan at any time, and if the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, the Fund may apply collateral received from the borrower against the obligation. The Fund may experience delays and costs in recovering the securities loaned. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. Security lending income represents the income earned on investing cash collateral, less rebates paid to borrowers and any lending agent fees associated with the loan, plus any premium payments received for lending certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds. Total security lending income during the period amounted to $125. During the period, there were no securities loaned to FCM.
8. Bank Borrowings.
The Fund is permitted to have bank borrowings for temporary or emergency purposes to fund shareholder redemptions or for other short-term liquidity requirements. The Fund has established borrowing arrangements with certain banks. The interest rate on the borrowings is the bank's base rate, as revised from time to time. The average loan balance during the period for which loans were outstanding amounted to $3,998. The weighted average interest rate was .86%. The interest expense amounted to $1 under the bank borrowing program. At period end, there were no bank borrowings outstanding.
9. Expense Reductions.
Commissions paid to certain brokers with whom the investment adviser, or its affiliates, places trades on behalf of the Fund include an amount in addition to trade execution, which may be rebated back to the Fund to offset certain expenses. This amount totaled $20 for the period.
In addition, during the period the investment adviser reimbursed and/or waived a portion of operating expenses in the amount of $10.
10. 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.
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, and (2) ongoing costs, including management fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (May 1, 2016 to October 31, 2016).
Actual Expenses
The first line of the accompanying table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. 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 provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. 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.
Annualized Expense Ratio-A | Beginning Account Value May 1, 2016 | Ending Account Value October 31, 2016 | Expenses Paid During Period-B May 1, 2016 to October 31, 2016 | |
Actual | .59% | $1,000.00 | $1,059.50 | $3.06 |
Hypothetical-C | $1,000.00 | $1,022.23 | $3.01 |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to the Fund's annualized expense ratio, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).
C 5% return per year before expenses
Board Approval of Investment Advisory Contracts and Management Fees
Fidelity Large Cap Stock Fund
Each year, the Board of Trustees, including the Independent Trustees (together, the Board), votes on the renewal of the management contract with Fidelity Management & Research Company (FMR) and the sub-advisory agreements (together, the Advisory Contracts) for the fund. The Board, assisted by the advice of fund counsel and Independent Trustees' counsel, requests and considers a broad range of information relevant to the renewal of the Advisory Contracts throughout the year.
The Board meets regularly and, at each of its meetings, covers an extensive agenda of topics and materials and considers factors that are relevant to its annual consideration of the renewal of the fund's Advisory Contracts, including the services and support provided to the fund and its shareholders. The Board has established various standing committees (Committees), each composed of and chaired by Independent Trustees with varying backgrounds, to which the Board has assigned specific subject matter responsibilities in order to enhance effective decision-making by the Board. The Board, acting directly and through its Committees, requests and receives information concerning the annual consideration of the renewal of the fund's Advisory Contracts. The Board also meets as needed to consider matters specifically related to the Board's annual consideration of the renewal of the Advisory Contracts. Members of the Board may also meet with trustees of other Fidelity funds through ad hoc joint committees to discuss certain matters relevant to all of the Fidelity funds.
At its July 2016 meeting, the Board unanimously determined to renew the fund's Advisory Contracts. In reaching its determination, the Board considered all factors it believed relevant, including (i) the nature, extent, and quality of the services to be provided to the fund and its shareholders (including the investment performance of the fund); (ii) the competitiveness of the fund's management fee and total expense ratio relative to peer funds; (iii) the total costs of the services to be provided by and the profits to be realized by Fidelity from its relationships with the fund; and (iv) the extent to which, if any, economies of scale exist and would be realized as the fund grows, and whether any economies of scale are appropriately shared with fund shareholders.
In considering whether to renew the Advisory Contracts for the fund, the Board reached a determination, with the assistance of fund counsel and Independent Trustees' counsel and through the exercise of its business judgment, that the renewal of the Advisory Contracts was in the best interests of the fund and its shareholders and that the compensation payable under the Advisory Contracts was fair and reasonable. The Board's decision to renew the Advisory Contracts was not based on any single factor, but rather was based on a comprehensive consideration of all the information provided to the Board at its meetings throughout the year. The Board, in reaching its determination to renew the Advisory Contracts, was aware that shareholders of the fund have a broad range of investment choices available to them, including a wide choice among funds offered by Fidelity's competitors, and that the fund's shareholders, who have the opportunity to review and weigh the disclosure provided by the fund in its prospectus and other public disclosures, have chosen to invest in this fund, which is part of the Fidelity family of funds.
Nature, Extent, and Quality of Services Provided. The Board considered Fidelity's staffing as it relates to the fund, including the backgrounds of investment personnel of Fidelity, and also considered the fund's investment objective, strategies, and related investment philosophy. The Independent Trustees also had discussions with senior management of Fidelity's investment operations and investment groups. The Board considered the structure of the investment personnel compensation program and whether this structure provides appropriate incentives to act in the best interests of the fund. Additionally, the Board considered the portfolio managers' investments, if any, in the funds that they manage.Resources Dedicated to Investment Management and Support Services. The Board and the Fund Oversight and Research Committees reviewed the general qualifications and capabilities of Fidelity's investment staff, including its size, education, experience, and resources, as well as Fidelity's approach to recruiting, training, managing, and compensating investment personnel. The Board noted that Fidelity has continued to increase the resources devoted to non-U.S. offices, including expansion of Fidelity's global investment organization. The Board also noted that Fidelity's analysts have extensive resources, tools and capabilities that allow them to conduct sophisticated quantitative and fundamental analysis, as well as credit analysis of issuers, counterparties and guarantors. Further, the Board considered that Fidelity's investment professionals have sufficient access to global information and data so as to provide competitive investment results over time, and that those professionals also have access to sophisticated tools that permit them to assess portfolio construction and risk and performance attribution characteristics continuously, as well as to transmit new information and research conclusions rapidly around the world. Additionally, in its deliberations, the Board considered Fidelity's trading, risk management, compliance, and technology and operations capabilities and resources, which are integral parts of the investment management process.Shareholder and Administrative Services. The Board considered (i) the nature, extent, quality, and cost of advisory, administrative, and shareholder services performed by FMR, the sub-advisers (together with FMR, the Investment Advisers), and their affiliates under the Advisory Contracts and under separate agreements covering transfer agency, pricing and bookkeeping, and securities lending services for the fund; (ii) the nature and extent of the supervision of third party service providers, principally custodians, subcustodians, and pricing vendors; and (iii) the resources devoted to, and the record of compliance with, the fund's compliance policies and procedures. The Board also reviewed the allocation of fund brokerage, including allocations to brokers affiliated with the Investment Advisers, the use of brokerage commissions to pay fund expenses, and the use of "soft" commission dollars to pay for research services.The Board noted that the growth of fund assets over time across the complex allows Fidelity to reinvest in the development of services designed to enhance the value or convenience of the Fidelity funds as investment vehicles. These services include 24-hour access to account information and market information through telephone representatives and over the Internet, investor education materials and asset allocation tools, and the expanded availability of Fidelity Investor Centers.In 2014, the Board formed an ad hoc Committee on Transfer Agency Fees to review the variety of transfer agency fee structures throughout the industry and Fidelity's competitive positioning with respect to industry participants.Investment in a Large Fund Family. The Board considered the benefits to shareholders of investing in a Fidelity fund, including the benefits of investing in a fund that is part of a large family of funds offering a variety of investment disciplines and providing a large variety of mutual fund investor services. The Board noted that Fidelity had taken, or had made recommendations that resulted in the Fidelity funds taking, a number of actions over the previous year that benefited particular funds, including: (i) continuing to dedicate additional resources to investment research and to the support of the senior management team that oversees asset management; (ii) continuing efforts to enhance Fidelity's global research capabilities; (iii) launching new funds and making other enhancements to meet client needs; (iv) broadening eligibility requirements for certain lower-priced share classes of, and streamlining the fee structure for, certain existing equity index funds; (v) lowering expense caps for certain existing funds and classes to reduce expenses paid by shareholders; (vi) eliminating redemption fees for certain variable insurance product funds and classes; (vii) continuing to launch dedicated lower cost underlying funds to meet portfolio construction needs related to expanding underlying fund options for Fidelity funds of funds, specifically for the Freedom Fund product lines; (viii) launching a lower cost share class for use by the Freedom Index Fund product line; (ix) rationalizing product lines and gaining increased efficiencies through fund mergers and share class consolidations; (x) continuing to develop, acquire and implement systems and technology to improve services to the funds and shareholders, strengthen information security, and increase efficiency; (xi) implementing investment enhancements to further strengthen Fidelity's target date product line to increase investors' probability of success in achieving their goals; (xii) accelerating the conversion of all remaining Class B shares to Class A shares, which have a lower expense structure; and (xiii) implementing changes to Fidelity's money market fund product line in response to recent regulatory reforms.Investment Performance. The Board considered whether the fund has operated in accordance with its investment objective, as well as its record of compliance with its investment restrictions and its performance history.The Board took into account discussions with representatives of the Investment Advisers about fund investment performance that occur at Board meetings throughout the year. In this regard the Board noted that as part of regularly scheduled fund reviews and other reports to the Board on fund performance, the Board considers annualized return information for the fund, for different time periods, measured against a securities market index ("benchmark index") and a peer group of funds with similar objectives ("peer group"), if any. In its evaluation of fund investment performance, the Board gave particular attention to information indicating changes in performance of certain Fidelity funds for specific time periods and discussed with the Investment Advisers the reasons for any overperformance or underperformance.In addition to reviewing absolute and relative fund performance, the Independent Trustees periodically consider the appropriateness of fund performance metrics in evaluating the results achieved. In general, the Independent Trustees believe that fund performance should be evaluated based on net performance (after fees and expenses) of both the highest performing and lowest performing fund share classes, where applicable, compared to appropriate benchmark indices, over appropriate time periods that may include full market cycles, and compared to peer groups, as applicable, over the same periods, taking into account relevant factors including the following: general market conditions; issuer-specific information; and fund cash flows and other factors.The Independent Trustees recognize that shareholders evaluate performance on a net basis over their own holding periods, for which one-, three-, and five-year periods are often used as a proxy. For this reason, the performance information reviewed by the Board also included net cumulative calendar year total return information for the fund and an appropriate benchmark index and peer group for the most recent one-, three-, and five-year periods, as shown below. Returns are shown compared to the 25th percentile (top of box, 75% beaten) and 75th percentile (bottom of box, 25% beaten) of the peer universe.Fidelity Large Cap Stock Fund
Fidelity Large Cap Stock Fund
Corporate Headquarters
245 Summer St.
Boston, MA 02210
www.fidelity.com
LCS-SANN-1216
1.465347.119
Fidelity® Mid-Cap Stock Fund Semi-Annual Report October 31, 2016 |
Contents
Board Approval of Investment Advisory Contracts and Management Fees |
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 1-800-544-8544 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third-party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. © 2016 FMR LLC. All rights reserved.
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, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Fund nor Fidelity Distributors Corporation is a bank.
Investment Summary (Unaudited)
Top Ten Stocks as of October 31, 2016
% of fund's net assets | % of fund's net assets 6 months ago | |
The Williams Companies, Inc. | 2.2 | 1.2 |
Eurofins Scientific SA | 2.0 | 1.8 |
Williams Partners LP | 1.5 | 1.3 |
Boston Scientific Corp. | 1.4 | 1.5 |
ARAMARK Holdings Corp. | 1.3 | 1.3 |
First Data Corp. Class A | 1.3 | 0.7 |
First American Financial Corp. | 1.3 | 1.2 |
Atmos Energy Corp. | 1.2 | 1.3 |
Alliant Energy Corp. | 1.2 | 1.1 |
Aspen Technology, Inc. | 1.2 | 0.5 |
14.6 |
Top Five Market Sectors as of October 31, 2016
% of fund's net assets | % of fund's net assets 6 months ago | |
Information Technology | 18.0 | 16.8 |
Financials | 13.1 | 18.1 |
Consumer Discretionary | 11.6 | 13.8 |
Industrials | 10.8 | 13.3 |
Energy | 10.7 | 10.9 |
Prior period industry classifications reflect the categories in place as of the date indicated and have not been adjusted to reflect current industry classifications.
Asset Allocation (% of fund's net assets)
As of October 31, 2016 * | ||
Stocks | 90.2% | |
Bonds | 0.1% | |
Short-Term Investments and Net Other Assets (Liabilities) | 9.7% |
* Foreign investments - 11.3%
As of April 30, 2016 * | ||
Stocks | 93.8% | |
Bonds | 0.1% | |
Short-Term Investments and Net Other Assets (Liabilities) | 6.1% |
* Foreign investments - 10.8%
Investments October 31, 2016 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 90.2% | |||
Shares | Value (000s) | ||
CONSUMER DISCRETIONARY - 11.6% | |||
Auto Components - 0.6% | |||
Magna International, Inc. Class A (sub. vtg.) | 577,900 | $23,727 | |
Tenneco, Inc. (a) | 327,000 | 18,008 | |
41,735 | |||
Distributors - 0.8% | |||
Pool Corp. | 596,001 | 55,178 | |
Hotels, Restaurants & Leisure - 2.5% | |||
ARAMARK Holdings Corp. | 2,620,940 | 97,578 | |
Domino's Pizza, Inc. | 330,400 | 55,917 | |
Noodles & Co. (a)(b)(c) | 2,368,600 | 11,132 | |
Whitbread PLC | 408,943 | 18,095 | |
182,722 | |||
Household Durables - 3.4% | |||
D.R. Horton, Inc. | 1,213,633 | 34,989 | |
Lennar Corp. Class A | 587,400 | 24,489 | |
NVR, Inc. (a) | 54,700 | 83,308 | |
Tempur Sealy International, Inc. (a)(b) | 842,600 | 45,559 | |
Toll Brothers, Inc. (a) | 2,123,887 | 58,279 | |
246,624 | |||
Internet & Direct Marketing Retail - 0.1% | |||
Etsy, Inc. (a) | 592,600 | 7,692 | |
Leisure Products - 0.5% | |||
New Academy Holding Co. LLC unit (a)(d)(e) | 294,000 | 32,702 | |
Media - 0.2% | |||
WME Entertainment Parent, LLC Class A unit (e)(f) | 8,196,036 | 16,835 | |
Specialty Retail - 2.5% | |||
AutoZone, Inc. (a) | 39,100 | 29,018 | |
Citi Trends, Inc. (c) | 892,953 | 17,734 | |
Ross Stores, Inc. | 481,400 | 30,107 | |
Sally Beauty Holdings, Inc. (a) | 895,200 | 23,221 | |
Tiffany & Co., Inc. (b) | 759,800 | 55,785 | |
Ulta Salon, Cosmetics & Fragrance, Inc. (a) | 85,100 | 20,708 | |
176,573 | |||
Textiles, Apparel & Luxury Goods - 1.0% | |||
Brunello Cucinelli SpA (b) | 2,079,700 | 41,185 | |
PVH Corp. | 309,500 | 33,110 | |
74,295 | |||
TOTAL CONSUMER DISCRETIONARY | 834,356 | ||
CONSUMER STAPLES - 3.1% | |||
Beverages - 0.5% | |||
Constellation Brands, Inc. Class A (sub. vtg.) | 225,400 | 37,669 | |
Food & Staples Retailing - 0.3% | |||
Tesco PLC (a) | 7,930,600 | 20,427 | |
Food Products - 1.9% | |||
Amira Nature Foods Ltd. (a)(b) | 1,793,975 | 14,065 | |
Amplify Snack Brands, Inc. (a)(b) | 1,322,059 | 19,157 | |
Greencore Group PLC | 2,326,400 | 9,397 | |
Mead Johnson Nutrition Co. Class A | 795,300 | 59,465 | |
The Hershey Co. | 303,200 | 31,066 | |
133,150 | |||
Household Products - 0.4% | |||
Church & Dwight Co., Inc. | 620,346 | 29,938 | |
TOTAL CONSUMER STAPLES | 221,184 | ||
ENERGY - 10.6% | |||
Energy Equipment & Services - 1.3% | |||
FMC Technologies, Inc. (a) | 678,200 | 21,886 | |
Helmerich & Payne, Inc. (b) | 421,600 | 26,607 | |
Oceaneering International, Inc. | 1,745,300 | 41,538 | |
Utica Shale Drilling Program (non-operating revenue interest) unit (e)(f) | 6,799,278 | 6,799 | |
96,830 | |||
Oil, Gas & Consumable Fuels - 9.3% | |||
Antero Resources Corp. (a) | 1,788,200 | 47,334 | |
Cabot Oil & Gas Corp. | 2,075,100 | 43,328 | |
Cimarex Energy Co. | 417,000 | 53,847 | |
Cobalt International Energy, Inc. (a) | 3,103,800 | 2,930 | |
Denbury Resources, Inc. (a)(b) | 4,058,300 | 9,699 | |
Diamondback Energy, Inc. (a) | 525,100 | 47,936 | |
Energy Transfer Equity LP | 2,233,800 | 33,351 | |
GasLog Ltd. (b) | 2,505,926 | 38,466 | |
Golar LNG Ltd. (b) | 1,361,500 | 29,803 | |
Range Resources Corp. | 666,600 | 22,524 | |
SM Energy Co. | 1,460,000 | 49,100 | |
Southwestern Energy Co. (a) | 1,246,800 | 12,954 | |
The Williams Companies, Inc. | 5,410,200 | 157,983 | |
Whiting Petroleum Corp. (a) | 1,761,700 | 14,516 | |
Williams Partners LP | 2,944,100 | 105,458 | |
669,229 | |||
TOTAL ENERGY | 766,059 | ||
FINANCIALS - 13.1% | |||
Banks - 4.8% | |||
First Republic Bank | 1,006,300 | 74,899 | |
FNB Corp., Pennsylvania | 3,720,700 | 48,630 | |
Huntington Bancshares, Inc. | 5,200,600 | 55,126 | |
M&T Bank Corp. | 457,100 | 56,100 | |
Regions Financial Corp. | 3,287,224 | 35,206 | |
SunTrust Banks, Inc. | 843,100 | 38,133 | |
UMB Financial Corp. | 635,100 | 39,408 | |
347,502 | |||
Capital Markets - 0.8% | |||
KKR & Co. LP | 4,039,184 | 57,316 | |
Insurance - 5.9% | |||
Arch Capital Group Ltd. (a) | 1,087,200 | 84,769 | |
Brown & Brown, Inc. | 1,188,900 | 43,823 | |
First American Financial Corp. | 2,418,400 | 94,463 | |
FNF Group | 2,021,400 | 72,588 | |
Jardine Lloyd Thompson Group PLC | 1,682,094 | 21,165 | |
Progressive Corp. | 1,785,300 | 56,255 | |
Willis Group Holdings PLC | 409,500 | 51,556 | |
424,619 | |||
Thrifts & Mortgage Finance - 1.6% | |||
MGIC Investment Corp. (a) | 5,982,309 | 48,816 | |
Radian Group, Inc. | 4,812,544 | 65,402 | |
114,218 | |||
TOTAL FINANCIALS | 943,655 | ||
HEALTH CARE - 9.9% | |||
Health Care Equipment & Supplies - 3.1% | |||
Boston Scientific Corp. (a) | 4,761,700 | 104,757 | |
DexCom, Inc. (a) | 167,000 | 13,066 | |
Teleflex, Inc. | 143,300 | 20,511 | |
The Cooper Companies, Inc. | 377,965 | 66,537 | |
Zeltiq Aesthetics, Inc. (a)(b) | 648,766 | 21,474 | |
226,345 | |||
Health Care Providers & Services - 2.9% | |||
Amplifon SpA | 2,539,682 | 26,848 | |
Corvel Corp. (a) | 242,398 | 8,375 | |
Henry Schein, Inc. (a) | 229,100 | 34,182 | |
MEDNAX, Inc. (a) | 942,200 | 57,710 | |
Premier, Inc. (a) | 583,900 | 18,591 | |
Universal Health Services, Inc. Class B | 501,900 | 60,584 | |
206,290 | |||
Health Care Technology - 0.6% | |||
HealthStream, Inc. (a) | 859,500 | 23,181 | |
Medidata Solutions, Inc. (a) | 398,700 | 19,134 | |
42,315 | |||
Life Sciences Tools & Services - 2.7% | |||
Agilent Technologies, Inc. | 1,185,200 | 51,639 | |
Eurofins Scientific SA | 323,800 | 147,121 | |
198,760 | |||
Pharmaceuticals - 0.6% | |||
Catalent, Inc. (a) | 1,780,650 | 40,617 | |
TOTAL HEALTH CARE | 714,327 | ||
INDUSTRIALS - 10.8% | |||
Aerospace & Defense - 3.3% | |||
Elbit Systems Ltd. | 89,708 | 8,863 | |
KEYW Holding Corp. (a)(b)(c) | 3,804,708 | 39,911 | |
Rockwell Collins, Inc. | 445,900 | 37,598 | |
Space Exploration Technologies Corp. Class A (a)(e) | 96,222 | 10,006 | |
Teledyne Technologies, Inc. (a) | 479,300 | 51,611 | |
Textron, Inc. | 1,411,600 | 56,577 | |
TransDigm Group, Inc. | 130,300 | 35,502 | |
240,068 | |||
Air Freight & Logistics - 1.2% | |||
C.H. Robinson Worldwide, Inc. | 498,600 | 33,965 | |
Expeditors International of Washington, Inc. | 429,457 | 22,104 | |
PostNL NV (a) | 5,708,600 | 26,896 | |
82,965 | |||
Commercial Services & Supplies - 1.0% | |||
KAR Auction Services, Inc. | 719,000 | 30,615 | |
Stericycle, Inc. (a) | 273,900 | 21,937 | |
U.S. Ecology, Inc. | 460,681 | 19,464 | |
72,016 | |||
Construction & Engineering - 0.4% | |||
Jacobs Engineering Group, Inc. (a) | 521,700 | 26,909 | |
Electrical Equipment - 1.8% | |||
AMETEK, Inc. | 1,197,092 | 52,792 | |
Generac Holdings, Inc. (a) | 822,600 | 31,333 | |
Melrose Industries PLC | 11,332,024 | 23,406 | |
Regal Beloit Corp. | 383,400 | 22,659 | |
130,190 | |||
Machinery - 1.4% | |||
Donaldson Co., Inc. | 1,208,000 | 44,116 | |
Pentair PLC | 302,000 | 16,649 | |
Rational AG | 76,500 | 39,680 | |
100,445 | |||
Road & Rail - 0.9% | |||
Genesee & Wyoming, Inc. Class A (a) | 554,700 | 37,686 | |
Kansas City Southern | 324,100 | 28,443 | |
66,129 | |||
Trading Companies & Distributors - 0.8% | |||
Rush Enterprises, Inc. Class A (a) | 743,100 | 19,506 | |
United Rentals, Inc. (a) | 493,073 | 37,306 | |
56,812 | |||
TOTAL INDUSTRIALS | 775,534 | ||
INFORMATION TECHNOLOGY - 18.0% | |||
Communications Equipment - 1.0% | |||
Brocade Communications Systems, Inc. | 4,616,900 | 48,939 | |
Juniper Networks, Inc. | 822,700 | 21,670 | |
70,609 | |||
Electronic Equipment & Components - 4.2% | |||
Amphenol Corp. Class A | 1,128,900 | 74,428 | |
Arrow Electronics, Inc. (a) | 1,337,000 | 81,717 | |
CDW Corp. | 554,000 | 24,880 | |
Fabrinet (a) | 1,123,931 | 42,664 | |
IPG Photonics Corp. (a) | 338,500 | 32,838 | |
Keysight Technologies, Inc. (a) | 1,538,000 | 50,446 | |
306,973 | |||
Internet Software & Services - 1.9% | |||
Akamai Technologies, Inc. (a) | 1,102,600 | 76,598 | |
Endurance International Group Holdings, Inc. (a)(b) | 2,358,600 | 17,336 | |
GoDaddy, Inc. (a)(b) | 1,134,800 | 40,614 | |
134,548 | |||
IT Services - 5.1% | |||
Fidelity National Information Services, Inc. | 667,186 | 49,318 | |
First Data Corp. Class A (a) | 6,893,773 | 96,444 | |
Fiserv, Inc. (a) | 538,000 | 52,982 | |
FleetCor Technologies, Inc. (a) | 340,100 | 59,620 | |
Leidos Holdings, Inc. | 434,500 | 18,062 | |
Total System Services, Inc. | 627,800 | 31,315 | |
WNS Holdings Ltd. sponsored ADR (a) | 2,109,100 | 58,000 | |
365,741 | |||
Semiconductors & Semiconductor Equipment - 1.8% | |||
Lam Research Corp. | 286,500 | 27,750 | |
Linear Technology Corp. | 386,500 | 23,213 | |
Maxim Integrated Products, Inc. | 760,900 | 30,154 | |
Silicon Laboratories, Inc. (a) | 529,694 | 31,755 | |
Xilinx, Inc. | 381,200 | 19,392 | |
132,264 | |||
Software - 4.0% | |||
ANSYS, Inc. (a) | 892,300 | 81,512 | |
Aspen Technology, Inc. (a) | 1,727,100 | 85,042 | |
Citrix Systems, Inc. (a) | 751,000 | 63,685 | |
Mobileye NV (a) | 806,000 | 29,967 | |
Red Hat, Inc. (a) | 373,500 | 28,928 | |
289,134 | |||
TOTAL INFORMATION TECHNOLOGY | 1,299,269 | ||
MATERIALS - 2.8% | |||
Chemicals - 0.8% | |||
Albemarle Corp. U.S. | 366,300 | 30,604 | |
Ingevity Corp. (a) | 193,966 | 8,030 | |
Potash Corp. of Saskatchewan, Inc. | 1,240,900 | 20,177 | |
58,811 | |||
Containers & Packaging - 0.8% | |||
WestRock Co. | 1,163,800 | 53,756 | |
Metals & Mining - 1.2% | |||
Franco-Nevada Corp. | 344,600 | 22,555 | |
Freeport-McMoRan, Inc. | 1,605,500 | 17,949 | |
Newcrest Mining Ltd. (a) | 1,294,685 | 22,219 | |
Novagold Resources, Inc. (a) | 5,148,776 | 25,757 | |
88,480 | |||
TOTAL MATERIALS | 201,047 | ||
REAL ESTATE - 4.6% | |||
Equity Real Estate Investment Trusts (REITs) - 4.2% | |||
Apartment Investment& Management Co. Class A | 918,000 | 40,456 | |
Cousins Properties, Inc. | 5,274,191 | 40,980 | |
Essex Property Trust, Inc. | 264,200 | 56,563 | |
Healthcare Realty Trust, Inc. | 1,648,900 | 52,583 | |
Healthcare Trust of America, Inc. | 1,117,200 | 34,186 | |
National Retail Properties, Inc. | 359,800 | 16,414 | |
Parkway, Inc. (a) | 659,273 | 11,880 | |
VEREIT, Inc. | 5,322,700 | 50,033 | |
303,095 | |||
Real Estate Management & Development - 0.4% | |||
Realogy Holdings Corp. | 1,142,800 | 26,159 | |
TOTAL REAL ESTATE | 329,254 | ||
TELECOMMUNICATION SERVICES - 0.2% | |||
Diversified Telecommunication Services - 0.2% | |||
Iridium Communications, Inc. (a)(b) | 1,820,300 | 14,835 | |
UTILITIES - 5.5% | |||
Electric Utilities - 4.0% | |||
Alliant Energy Corp. | 2,310,400 | 87,911 | |
IDACORP, Inc. | 954,133 | 74,794 | |
OGE Energy Corp. | 2,184,600 | 67,810 | |
Xcel Energy, Inc. | 1,354,982 | 56,300 | |
286,815 | |||
Gas Utilities - 1.5% | |||
Atmos Energy Corp. | 1,221,897 | 90,897 | |
Spire, Inc. | 335,000 | 21,038 | |
111,935 | |||
TOTAL UTILITIES | 398,750 | ||
TOTAL COMMON STOCKS | |||
(Cost $5,207,460) | 6,498,270 | ||
Principal Amount (000s) | Value (000s) | ||
Nonconvertible Bonds - 0.1% | |||
ENERGY - 0.1% | |||
Energy Equipment & Services - 0.1% | |||
Pacific Drilling SA 5.375% 6/1/20 (g) | |||
(Cost $15,957) | 26,270 | 7,487 | |
Shares | Value (000s) | ||
Money Market Funds - 12.1% | |||
Fidelity Cash Central Fund, 0.41% (h) | 687,500,220 | 687,706 | |
Fidelity Securities Lending Cash Central Fund 0.48% (h)(i) | 183,031,793 | 183,068 | |
TOTAL MONEY MARKET FUNDS | |||
(Cost $870,619) | 870,774 | ||
TOTAL INVESTMENT PORTFOLIO - 102.4% | |||
(Cost $6,094,036) | 7,376,531 | ||
NET OTHER ASSETS (LIABILITIES) - (2.4)% | (171,183) | ||
NET ASSETS - 100% | $7,205,348 |
Legend
(a) Non-income producing
(b) Security or a portion of the security is on loan at period end.
(c) Affiliated company
(d) Investment is owned by an entity that is treated as a U.S. Corporation for tax purposes in which the Fund holds a percentage ownership.
(e) Restricted securities - Investment in securities not registered under the Securities Act of 1933 (excluding 144A issues). At the end of the period, the value of restricted securities (excluding 144A issues) amounted to $66,342,000 or 0.9% of net assets.
(f) Investment is owned by a wholly-owned subsidiary (Subsidiary) that is treated as a corporation for U.S. tax purposes.
(g) 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 $7,487,000 or 0.1% of net assets.
(h) Affiliated fund that is generally 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. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
(i) Investment made with cash collateral received from securities on loan.
Additional information on each restricted holding is as follows:
Security | Acquisition Date | Acquisition Cost (000s) |
New Academy Holding Co. LLC unit | 8/1/11 | $30,988 |
Space Exploration Technologies Corp. Class A | 4/8/16 | $9,278 |
Utica Shale Drilling Program (non-operating revenue interest) unit | 10/5/16 | $6,799 |
WME Entertainment Parent, LLC Class A unit | 8/16/16 | $16,835 |
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 |
(Amounts in thousands) | |
Fidelity Cash Central Fund | $984 |
Fidelity Securities Lending Cash Central Fund | 1,295 |
Total | $2,279 |
Other Affiliated Issuers
An affiliated company is a company in which the Fund has ownership of at least 5% of the voting securities. Fiscal year to date transactions with companies which are or were affiliates are as follows:
Affiliate (Amounts in thousands) | Value, beginning of period | Purchases | Sales Proceeds* | Dividend Income | Value, end of period |
Citi Trends, Inc. | $16,152 | $-- | $103 | $107 | $17,734 |
KEYW Holding Corp. | 24,249 | 3,384 | 201 | -- | 39,911 |
Noodles & Co. | 26,599 | -- | 172 | -- | 11,132 |
Total | $67,000 | $3,384 | $476 | $107 | $68,777 |
* Includes the value of securities delivered through in-kind transactions, if applicable.
Investment Valuation
The following is a summary of the inputs used, as of October 31, 2016, involving the Fund's assets and liabilities carried at fair 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 below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
Valuation Inputs at Reporting Date: | ||||
Description | Total | Level 1 | Level 2 | Level 3 |
(Amounts in thousands) | ||||
Investments in Securities: | ||||
Equities: | ||||
Consumer Discretionary | $834,356 | $784,819 | $-- | $49,537 |
Consumer Staples | 221,184 | 200,757 | 20,427 | -- |
Energy | 766,059 | 759,260 | -- | 6,799 |
Financials | 943,655 | 943,655 | -- | -- |
Health Care | 714,327 | 714,327 | -- | -- |
Industrials | 775,534 | 765,528 | -- | 10,006 |
Information Technology | 1,299,269 | 1,299,269 | -- | -- |
Materials | 201,047 | 201,047 | -- | -- |
Real Estate | 329,254 | 329,254 | -- | -- |
Telecommunication Services | 14,835 | 14,835 | -- | -- |
Utilities | 398,750 | 398,750 | -- | -- |
Corporate Bonds | 7,487 | -- | 7,487 | -- |
Money Market Funds | 870,774 | 870,774 | -- | -- |
Total Investments in Securities: | $7,376,531 | $7,282,275 | $27,914 | $66,342 |
Other Information
Distribution of investments by country or territory of incorporation, as a percentage of Total Net Assets, is as follows (Unaudited):
United States of America | 88.7% |
Luxembourg | 2.1% |
Bermuda | 2.1% |
Canada | 1.3% |
United Kingdom | 1.1% |
Italy | 1.0% |
Others (Individually Less Than 1%) | 3.7% |
100.0% |
See accompanying notes which are an integral part of the financial statements.
Financial Statements
Statement of Assets and Liabilities
Amounts in thousands (except per-share amounts) | October 31, 2016 (Unaudited) | |
Assets | ||
Investment in securities, at value (including securities loaned of $176,226) — See accompanying schedule: Unaffiliated issuers (cost $5,111,738) | $6,436,980 | |
Fidelity Central Funds (cost $870,619) | 870,774 | |
Other affiliated issuers (cost $111,679) | 68,777 | |
Total Investments (cost $6,094,036) | $7,376,531 | |
Receivable for investments sold | 13,830 | |
Receivable for fund shares sold | 3,507 | |
Dividends receivable | 4,750 | |
Interest receivable | 588 | |
Distributions receivable from Fidelity Central Funds | 427 | |
Prepaid expenses | 19 | |
Other receivables | 478 | |
Total assets | 7,400,130 | |
Liabilities | ||
Payable for investments purchased | $1,172 | |
Payable for fund shares redeemed | 6,239 | |
Accrued management fee | 2,983 | |
Other affiliated payables | 904 | |
Other payables and accrued expenses | 458 | |
Collateral on securities loaned, at value | 183,026 | |
Total liabilities | 194,782 | |
Net Assets | $7,205,348 | |
Net Assets consist of: | ||
Paid in capital | $5,712,744 | |
Undistributed net investment income | 29,451 | |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | 180,663 | |
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies | 1,282,490 | |
Net Assets | $7,205,348 | |
Mid-Cap Stock: | ||
Net Asset Value, offering price and redemption price per share ($5,203,821 ÷ 154,042 shares) | $33.78 | |
Class K: | ||
Net Asset Value, offering price and redemption price per share ($2,001,527 ÷ 59,201 shares) | $33.81 |
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Amounts in thousands | Six months ended October 31, 2016 (Unaudited) | |
Investment Income | ||
Dividends (including $107 earned from other affiliated issuers) | $47,559 | |
Interest | 1,636 | |
Income from Fidelity Central Funds | 2,279 | |
Total income | 51,474 | |
Expenses | ||
Management fee | ||
Basic fee | $19,849 | |
Performance adjustment | (3,367) | |
Transfer agent fees | 4,815 | |
Accounting and security lending fees | 612 | |
Custodian fees and expenses | 61 | |
Independent trustees' fees and expenses | 16 | |
Registration fees | 56 | |
Audit | 39 | |
Legal | 12 | |
Miscellaneous | 37 | |
Total expenses before reductions | 22,130 | |
Expense reductions | (205) | 21,925 |
Net investment income (loss) | 29,549 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | 190,561 | |
Fidelity Central Funds | 3 | |
Other affiliated issuers | (129) | |
Foreign currency transactions | (32) | |
Total net realized gain (loss) | 190,403 | |
Change in net unrealized appreciation (depreciation) on: Investment securities | 114,367 | |
Assets and liabilities in foreign currencies | (14) | |
Total change in net unrealized appreciation (depreciation) | 114,353 | |
Net gain (loss) | 304,756 | |
Net increase (decrease) in net assets resulting from operations | $334,305 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Amounts in thousands | Six months ended October 31, 2016 (Unaudited) | Year ended April 30, 2016 |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $29,549 | $46,833 |
Net realized gain (loss) | 190,403 | 857,446 |
Change in net unrealized appreciation (depreciation) | 114,353 | (1,201,757) |
Net increase (decrease) in net assets resulting from operations | 334,305 | (297,478) |
Distributions to shareholders from net investment income | (17,748) | (48,569) |
Distributions to shareholders from net realized gain | (366,839) | (930,371) |
Total distributions | (384,587) | (978,940) |
Share transactions - net increase (decrease) | 131,662 | (61,224) |
Redemption fees | 21 | 35 |
Total increase (decrease) in net assets | 81,401 | (1,337,607) |
Net Assets | ||
Beginning of period | 7,123,947 | 8,461,554 |
End of period | $7,205,348 | $7,123,947 |
Other Information | ||
Undistributed net investment income end of period | $29,451 | $17,650 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Mid-Cap Stock Fund
Six months ended (Unaudited) October 31, | Years ended April 30, | |||||
2016 | 2016 | 2015 | 2014 | 2013 | 2012 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $34.07 | $40.11 | $40.26 | $33.69 | $30.15 | $31.78 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .13 | .21 | .18 | .10 | .29 | .10 |
Net realized and unrealized gain (loss) | 1.43 | (1.54) | 3.52 | 7.69 | 4.45 | (.18) |
Total from investment operations | 1.56 | (1.33) | 3.70 | 7.79 | 4.74 | (.08) |
Distributions from net investment income | (.08) | (.22) | (.09) | (.08) | (.33) | (.05) |
Distributions from net realized gain | (1.77) | (4.49) | (3.76) | (1.14) | (.87) | (1.50) |
Total distributions | (1.85) | (4.71) | (3.85) | (1.22) | (1.20) | (1.55) |
Redemption fees added to paid in capitalA,B | – | – | – | – | – | – |
Net asset value, end of period | $33.78 | $34.07 | $40.11 | $40.26 | $33.69 | $30.15 |
Total ReturnC,D | 4.73% | (3.44)% | 9.83% | 23.50% | 16.54% | .19% |
Ratios to Average Net AssetsE,F | ||||||
Expenses before reductions | .64%G | .72% | .73% | .78% | .65% | .86% |
Expenses net of fee waivers, if any | .64%G | .72% | .72% | .78% | .65% | .86% |
Expenses net of all reductions | .64%G | .72% | .72% | .78% | .63% | .85% |
Net investment income (loss) | .78%G | .59% | .46% | .25% | .95% | .36% |
Supplemental Data | ||||||
Net assets, end of period (in millions) | $5,204 | $5,136 | $5,874 | $5,966 | $4,750 | $5,170 |
Portfolio turnover rateH | 30%G,I | 23%I | 29% | 27% | 46% | 52% |
A Calculated based on average shares outstanding during the period.
B Amount represents less than $.005 per share.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Fees and expenses of any 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 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.
G Annualized
H Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
I Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Mid-Cap Stock Fund Class K
Six months ended (Unaudited) October 31, | Years ended April 30, | |||||
2016 | 2016 | 2015 | 2014 | 2013 | 2012 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $34.08 | $40.12 | $40.27 | $33.68 | $30.15 | $31.77 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .15 | .25 | .22 | .15 | .33 | .15 |
Net realized and unrealized gain (loss) | 1.44 | (1.54) | 3.51 | 7.69 | 4.45 | (.19) |
Total from investment operations | 1.59 | (1.29) | 3.73 | 7.84 | 4.78 | (.04) |
Distributions from net investment income | (.10) | (.26) | (.13) | (.12) | (.38) | (.08) |
Distributions from net realized gain | (1.77) | (4.49) | (3.76) | (1.14) | (.87) | (1.50) |
Total distributions | (1.86)B | (4.75) | (3.88)C | (1.25)D | (1.25) | (1.58) |
Redemption fees added to paid in capitalA,E | – | – | – | – | – | – |
Net asset value, end of period | $33.81 | $34.08 | $40.12 | $40.27 | $33.68 | $30.15 |
Total ReturnF,G | 4.83% | (3.33)% | 9.92% | 23.67% | 16.72% | .35% |
Ratios to Average Net AssetsH,I | ||||||
Expenses before reductions | .52%J | .60% | .61% | .65% | .50% | .69% |
Expenses net of fee waivers, if any | .52%J | .60% | .61% | .65% | .50% | .69% |
Expenses net of all reductions | .52%J | .60% | .61% | .65% | .48% | .68% |
Net investment income (loss) | .90%J | .71% | .57% | .39% | 1.11% | .52% |
Supplemental Data | ||||||
Net assets, end of period (in millions) | $2,002 | $1,988 | $2,588 | $2,927 | $2,447 | $1,643 |
Portfolio turnover rateK | 30%J,L | 23%L | 29% | 27% | 46% | 52% |
A Calculated based on average shares outstanding during the period.
B Total distributions of $1.86 per share is comprised of distributions from net investment income of $.095 and distributions from net realized gain of $1.769 per share.
C Total distributions of $3.88 per share is comprised of distributions from net investment income of $.127 and distributions from net realized gain of $3.757 per share.
D Total distributions of $1.25 per share is comprised of distributions from net investment income of $.116 and distributions from net realized gain of $1.136 per share.
E Amount represents less than $.005 per share.
F Total returns for periods of less than one year are not annualized.
G Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
H Fees and expenses of any 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.
I 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.
J Annualized
K Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
L Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended October 31, 2016
(Amounts in thousands except percentages)
1. Organization.
Fidelity Mid-Cap Stock Fund (the Fund) is a fund of Fidelity Concord Street Trust (the Trust) (formerly a fund of Fidelity Commonwealth 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 Mid-Cap Stock and Class K shares, each of which has equal rights as to assets and voting privileges. Each class has exclusive voting rights with respect to matters that affect that class.
2. Investments in Fidelity Central Funds.
The Fund invests in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser 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 the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website 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. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Trustees (the Board) has delegated the day to day responsibility for the valuation of the Fund's investments to the Fair Value Committee (the Committee) established by the Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, the Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment 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 Committee oversees the Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing the Fund's investments and ratifies the fair value determinations of the Committee.
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)
Valuation techniques used to value the Fund's investments by major category are as follows:
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing vendor 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 or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For foreign equity securities, when market or security specific events arise, comparisons to the valuation of American Depositary Receipts (ADRs), futures contracts, Exchange-Traded Funds (ETFs) and certain indexes as well as quoted prices for similar securities may be used and would be categorized as Level 2 in the hierarchy. Utilizing these techniques may result in transfers between Level 1 and Level 2. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Debt securities, including restricted securities, are valued based on evaluated prices received from third party pricing vendors or from brokers who make markets in such securities. Corporate bonds are valued by pricing vendors who utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type or by broker-supplied prices. When independent prices are unavailable or unreliable, debt securities may be valued utilizing pricing methodologies which consider similar factors that would be used by third party pricing vendors. Debt securities are generally categorized as Level 2 in the hierarchy but may be Level 3 depending on the circumstances.
Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
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 October 31, 2016 is included at the end of the Fund's Schedule of Investments.
Foreign Currency. The Fund may use 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 rates 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 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. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Distributions received on securities that represent a return of capital or capital gain are recorded as a reduction of cost of investments and/or as a realized gain. Subsequent to ex-dividend date the Fund determines the components of these distributions, based upon receipt of tax filings or other correspondence relating to the underlying investment. Interest income is accrued as earned and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.
Class Allocations and Expenses. Investment income, realized and unrealized capital gains and losses, common expenses of the Fund, and certain fund-level expense reductions, if any, are allocated daily 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 fees incurred. Certain expense reductions may also differ by class. For the reporting period, the allocated portion of income and expenses to each class as a percent of its average net assets may vary due to the timing of recording these transactions in relation to fluctuating net assets of the classes. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Deferred Trustee Compensation. Under a Deferred Compensation Plan (the Plan), independent Trustees may elect to defer receipt of a portion of their annual compensation. Deferred amounts are invested in a cross-section of Fidelity funds, are marked-to-market and remain in the Fund until distributed in accordance with the Plan. The investment of deferred amounts and the offsetting payable to the Trustees are included in the accompanying Statement of Assets and Liabilities.
Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. The Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction. Foreign taxes are provided for based on the Fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.
Distributions are declared and 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. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to foreign currency transactions, partnerships, passive foreign investment companies (PFIC), market discount, redemptions in kind, deferred trustees compensation and losses deferred due to wash sales and excise tax regulations.
The federal tax cost of investment securities and unrealized appreciation (depreciation) as of period end were as follows:
Gross unrealized appreciation | $1,751,282 |
Gross unrealized depreciation | (467,630) |
Net unrealized appreciation (depreciation) on securities | $1,283,652 |
Tax cost | $6,092,879 |
Short-Term Trading (Redemption) Fees. Shares held by investors in the Fund less than 30 days may have been subject to a redemption fee equal to .75% of the NAV of shares redeemed. All redemption fees, which reduce the proceeds of the shareholder redemption, are retained by the Fund and accounted for as an addition to paid in capital. In November 2016, the Board of Trustees approved the elimination of these redemption fees effective December 12, 2016.
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.
Consolidated Subsidiary. The Fund invests in certain investments through a wholly-owned subsidiary ("Subsidiary"), which may be subject to federal and state taxes upon disposition.
As of period end, the Fund held an investment of $23,634 in these Subsidiaries, representing .33% of the Fund's net assets. The financial statements have been consolidated and include accounts of the Fund and each Subsidiary. Accordingly, all inter-company transactions and balances have been eliminated.
4. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities and in-kind transactions, aggregated $1,022,607 and $1,440,670, respectively.
Redemptions In-Kind. During the period, 1,430 shares of the Fund held by an unaffiliated entity were redeemed in-kind for investments, including accrued interest, with a value of $47,905. The net realized gain of $12,613 on investments delivered through the in-kind redemptions is included in the accompanying Statement of Operations. The amount of the redemptions is included in share transactions in the accompanying Statement of Changes in Net Assets as well as Note 10: Share Transactions. The Fund recognized no gain or loss for federal income tax purposes.
Prior Fiscal Year Redemptions In-Kind. During the prior period, 7,169 shares of the Fund held by unaffiliated entities were redeemed in-kind for investments, including accrued interest, and cash with a value of $265,315. The Fund had a net realized gain of $85,469 on investments delivered through the in-kind redemptions. The amount of the redemptions is included in share transactions in the accompanying Statement of Changes in Net Assets as well as Note 10: Share Transactions. The Fund recognized no gain or loss for federal income tax purposes.
5. Fees and Other Transactions with Affiliates.
Management Fee. Fidelity Management & Research Company (the investment adviser) and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .30% of the Fund's average net assets and an annualized group fee rate that averaged .25% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by the investment adviser, including any mutual funds previously advised by the investment adviser that are currently advised by Fidelity SelectCo, LLC, an affiliate of the investment adviser. The group fee rate decreases as assets under management increase and increases as assets under management decrease. In addition, the management fee is subject to a performance adjustment (up to a maximum of +/- .20% of the Fund's average net assets over a 36 month performance period). The upward or downward adjustment to the management fee is based on the relative investment performance of Mid-Cap Stock as compared to its benchmark index, the S&P MidCap 400 Index, over the same 36 month performance period. For the reporting period, the total annualized management fee rate, including the performance adjustment, was .45% of the Fund's average net assets. The performance adjustment included in the management fee rate may be higher or lower than the maximum performance adjustment rate due to the difference between the average net assets for the reporting and performance periods.
Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc., (FIIOC), an affiliate of the investment adviser, 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 Mid-Cap Stock. FIIOC receives an asset-based fee of Class K's average net assets. FIIOC pays for typesetting, printing and mailing of shareholder reports, except proxy statements.
For the period, transfer agent fees for each class were as follows:
Amount | % of Class-Level Average Net Assets(a) | |
Mid-Cap Stock | $4,342 | .17 |
Class K | 473 | .05 |
$ 4,815 |
(a) Annualized
Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of the investment adviser, maintains the Fund's accounting records. The accounting fee is based on the level of average net assets for each 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.
Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. Brokerage commissions are included in net realized gain (loss) and change in net unrealized appreciation (depreciation) in the Statement of Operations. The commissions paid to these affiliated firms were $54 for the period.
Interfund Trades. The Fund may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
6. Committed Line of Credit.
The Fund participates with other funds managed by the investment adviser or an affiliate in a $4.25 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 $12 and is reflected in Miscellaneous expenses on the Statement of Operations. During the period, the Fund did not borrow on this line of credit.
7. Security Lending.
The Fund lends portfolio securities through a lending agent from time to time in order to earn additional income. For equity securities, a lending agent is used and may loan securities to certain qualified borrowers, including Fidelity Capital Markets (FCM), a broker-dealer affiliated with the Fund. On the settlement date of the loan, the Fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the Fund and any additional required collateral is delivered to the Fund on the next business day. The Fund or borrower may terminate the loan at any time, and if the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, the Fund may apply collateral received from the borrower against the obligation. The Fund may experience delays and costs in recovering the securities loaned. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. The value of securities loaned to FCM at period end was $10,446. Security lending income represents the income earned on investing cash collateral, less rebates paid to borrowers and any lending agent fees associated with the loan, plus any premium payments received for lending certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds. Total security lending income during the period amounted to $1,295, including $47 from securities loaned to FCM.
8. Expense Reductions.
Commissions paid to certain brokers with whom the investment adviser, or its affiliates, places trades on behalf of the Fund include an amount in addition to trade execution, which may be rebated back to the Fund to offset certain expenses. This amount totaled $178 for the period.
In addition, during the period the investment adviser reimbursed and/or waived a portion of fund-level operating expenses in the amount of $27.
9. Distributions to Shareholders.
Distributions to shareholders of each class were as follows:
Six months ended October 31, 2016 | Year ended April 30, 2016 | |
From net investment income | ||
Mid-Cap Stock | $12,316 | $32,540 |
Class K | 5,432 | 16,029 |
Total | $17,748 | $48,569 |
From net realized gain | ||
Mid-Cap Stock | $265,698 | $657,512 |
Class K | 101,141 | 272,859 |
Total | $366,839 | $930,371 |
10. Share Transactions.
Share transactions for each class were as follows and may contain automatic conversions between classes or exchanges between affiliated funds:
Shares | Shares | Dollars | Dollars | |
Six months ended October 31, 2016 | Year ended April 30, 2016 | Six months ended October 31, 2016 | Year ended April 30, 2016 | |
Mid-Cap Stock | ||||
Shares sold | 6,994 | 11,317 | $237,186 | $392,342 |
Reinvestment of distributions | 8,069 | 18,581 | 265,395 | 658,782 |
Shares redeemed | (11,765) | (25,606) | (397,504) | (889,201) |
Net increase (decrease) | 3,298 | 4,292 | $105,077 | $161,923 |
Class K | ||||
Shares sold | 6,121 | 10,618 | $206,952 | $370,206 |
Reinvestment of distributions | 3,239 | 8,154 | 106,573 | 288,888 |
Shares redeemed | (8,490)(a) | (24,946)(b) | (286,940)(a) | (882,241)(b) |
Net increase (decrease) | 870 | (6,174) | $26,585 | $(223,147) |
(a) Amount includes in-kind redemptions (see Note 4: Redemptions In-Kind).
(b) Amount includes in-kind redemptions (see Note 4: Prior Fiscal Year Redemptions In-Kind).
11. 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.
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including redemption fees and (2) ongoing costs, including management fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (May 1, 2016 to October 31, 2016).
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. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. 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. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. 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.
Annualized Expense Ratio-A | Beginning Account Value May 1, 2016 | Ending Account Value October 31, 2016 | Expenses Paid During Period-B May 1, 2016 to October 31, 2016 | |
Mid-Cap Stock | .64% | |||
Actual | $1,000.00 | $1,047.30 | $3.30 | |
Hypothetical-C | $1,000.00 | $1,021.98 | $3.26 | |
Class K | .52% | |||
Actual | $1,000.00 | $1,048.30 | $2.68 | |
Hypothetical-C | $1,000.00 | $1,022.58 | $2.65 |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).
C 5% return per year before expenses
Board Approval of Investment Advisory Contracts and Management Fees
Fidelity Mid-Cap Stock Fund
Each year, the Board of Trustees, including the Independent Trustees (together, the Board), votes on the renewal of the management contract with Fidelity Management & Research Company (FMR) and the sub-advisory agreements (together, the Advisory Contracts) for the fund. The Board, assisted by the advice of fund counsel and Independent Trustees' counsel, requests and considers a broad range of information relevant to the renewal of the Advisory Contracts throughout the year.
The Board meets regularly and, at each of its meetings, covers an extensive agenda of topics and materials and considers factors that are relevant to its annual consideration of the renewal of the fund's Advisory Contracts, including the services and support provided to the fund and its shareholders. The Board has established various standing committees (Committees), each composed of and chaired by Independent Trustees with varying backgrounds, to which the Board has assigned specific subject matter responsibilities in order to enhance effective decision-making by the Board. The Board, acting directly and through its Committees, requests and receives information concerning the annual consideration of the renewal of the fund's Advisory Contracts. The Board also meets as needed to consider matters specifically related to the Board's annual consideration of the renewal of the Advisory Contracts. Members of the Board may also meet with trustees of other Fidelity funds through ad hoc joint committees to discuss certain matters relevant to all of the Fidelity funds.
At its July 2016 meeting, the Board unanimously determined to renew the fund's Advisory Contracts. In reaching its determination, the Board considered all factors it believed relevant, including (i) the nature, extent, and quality of the services to be provided to the fund and its shareholders (including the investment performance of the fund); (ii) the competitiveness of the fund's management fee and total expense ratio relative to peer funds; (iii) the total costs of the services to be provided by and the profits to be realized by Fidelity from its relationships with the fund; and (iv) the extent to which, if any, economies of scale exist and would be realized as the fund grows, and whether any economies of scale are appropriately shared with fund shareholders.
In considering whether to renew the Advisory Contracts for the fund, the Board reached a determination, with the assistance of fund counsel and Independent Trustees' counsel and through the exercise of its business judgment, that the renewal of the Advisory Contracts was in the best interests of the fund and its shareholders and that the compensation payable under the Advisory Contracts was fair and reasonable. The Board's decision to renew the Advisory Contracts was not based on any single factor, but rather was based on a comprehensive consideration of all the information provided to the Board at its meetings throughout the year. The Board, in reaching its determination to renew the Advisory Contracts, was aware that shareholders of the fund have a broad range of investment choices available to them, including a wide choice among funds offered by Fidelity's competitors, and that the fund's shareholders, who have the opportunity to review and weigh the disclosure provided by the fund in its prospectus and other public disclosures, have chosen to invest in this fund, which is part of the Fidelity family of funds.
Nature, Extent, and Quality of Services Provided. The Board considered Fidelity's staffing as it relates to the fund, including the backgrounds of investment personnel of Fidelity, and also considered the fund's investment objective, strategies, and related investment philosophy. The Independent Trustees also had discussions with senior management of Fidelity's investment operations and investment groups. The Board considered the structure of the investment personnel compensation program and whether this structure provides appropriate incentives to act in the best interests of the fund. Additionally, the Board considered the portfolio managers' investments, if any, in the funds that they manage.Resources Dedicated to Investment Management and Support Services. The Board and the Fund Oversight and Research Committees reviewed the general qualifications and capabilities of Fidelity's investment staff, including its size, education, experience, and resources, as well as Fidelity's approach to recruiting, training, managing, and compensating investment personnel. The Board noted that Fidelity has continued to increase the resources devoted to non-U.S. offices, including expansion of Fidelity's global investment organization. The Board also noted that Fidelity's analysts have extensive resources, tools and capabilities that allow them to conduct sophisticated quantitative and fundamental analysis, as well as credit analysis of issuers, counterparties and guarantors. Further, the Board considered that Fidelity's investment professionals have sufficient access to global information and data so as to provide competitive investment results over time, and that those professionals also have access to sophisticated tools that permit them to assess portfolio construction and risk and performance attribution characteristics continuously, as well as to transmit new information and research conclusions rapidly around the world. Additionally, in its deliberations, the Board considered Fidelity's trading, risk management, compliance, and technology and operations capabilities and resources, which are integral parts of the investment management process.Shareholder and Administrative Services. The Board considered (i) the nature, extent, quality, and cost of advisory, administrative, and shareholder services performed by FMR, the sub-advisers (together with FMR, the Investment Advisers), and their affiliates under the Advisory Contracts and under separate agreements covering transfer agency, pricing and bookkeeping, and securities lending services for the fund; (ii) the nature and extent of the supervision of third party service providers, principally custodians, subcustodians, and pricing vendors; and (iii) the resources devoted to, and the record of compliance with, the fund's compliance policies and procedures. The Board also reviewed the allocation of fund brokerage, including allocations to brokers affiliated with the Investment Advisers, the use of brokerage commissions to pay fund expenses, and the use of "soft" commission dollars to pay for research services.The Board noted that the growth of fund assets over time across the complex allows Fidelity to reinvest in the development of services designed to enhance the value or convenience of the Fidelity funds as investment vehicles. These services include 24-hour access to account information and market information through telephone representatives and over the Internet, investor education materials and asset allocation tools, and the expanded availability of Fidelity Investor Centers.In 2014, the Board formed an ad hoc Committee on Transfer Agency Fees to review the variety of transfer agency fee structures throughout the industry and Fidelity's competitive positioning with respect to industry participants.Investment in a Large Fund Family. The Board considered the benefits to shareholders of investing in a Fidelity fund, including the benefits of investing in a fund that is part of a large family of funds offering a variety of investment disciplines and providing a large variety of mutual fund investor services. The Board noted that Fidelity had taken, or had made recommendations that resulted in the Fidelity funds taking, a number of actions over the previous year that benefited particular funds, including: (i) continuing to dedicate additional resources to investment research and to the support of the senior management team that oversees asset management; (ii) continuing efforts to enhance Fidelity's global research capabilities; (iii) launching new funds and making other enhancements to meet client needs; (iv) broadening eligibility requirements for certain lower-priced share classes of, and streamlining the fee structure for, certain existing equity index funds; (v) lowering expense caps for certain existing funds and classes to reduce expenses paid by shareholders; (vi) eliminating redemption fees for certain variable insurance product funds and classes; (vii) continuing to launch dedicated lower cost underlying funds to meet portfolio construction needs related to expanding underlying fund options for Fidelity funds of funds, specifically for the Freedom Fund product lines; (viii) launching a lower cost share class for use by the Freedom Index Fund product line; (ix) rationalizing product lines and gaining increased efficiencies through fund mergers and share class consolidations; (x) continuing to develop, acquire and implement systems and technology to improve services to the funds and shareholders, strengthen information security, and increase efficiency; (xi) implementing investment enhancements to further strengthen Fidelity's target date product line to increase investors' probability of success in achieving their goals; (xii) accelerating the conversion of all remaining Class B shares to Class A shares, which have a lower expense structure; and (xiii) implementing changes to Fidelity's money market fund product line in response to recent regulatory reforms.Investment Performance. The Board considered whether the fund has operated in accordance with its investment objective, as well as its record of compliance with its investment restrictions and its performance history. The Board noted that there was a portfolio management change for the fund in June 2016.The Board took into account discussions with representatives of the Investment Advisers about fund investment performance that occur at Board meetings throughout the year. In this regard the Board noted that as part of regularly scheduled fund reviews and other reports to the Board on fund performance, the Board considers annualized return information for the fund, for different time periods, measured against a securities market index ("benchmark index") and a peer group of funds with similar objectives ("peer group"), if any. In its evaluation of fund investment performance, the Board gave particular attention to information indicating changes in performance of certain Fidelity funds for specific time periods and discussed with the Investment Advisers the reasons for any overperformance or underperformance.In addition to reviewing absolute and relative fund performance, the Independent Trustees periodically consider the appropriateness of fund performance metrics in evaluating the results achieved. In general, the Independent Trustees believe that fund performance should be evaluated based on net performance (after fees and expenses) of both the highest performing and lowest performing fund share classes, where applicable, compared to appropriate benchmark indices, over appropriate time periods that may include full market cycles, and compared to peer groups, as applicable, over the same periods, taking into account relevant factors including the following: general market conditions; issuer-specific information; and fund cash flows and other factors.The Independent Trustees recognize that shareholders evaluate performance on a net basis over their own holding periods, for which one-, three-, and five-year periods are often used as a proxy. For this reason, the performance information reviewed by the Board also included net cumulative calendar year total return information for the fund and an appropriate benchmark index and peer group for the most recent one-, three-, and five-year periods, as shown below. Returns are shown compared to the 25th percentile (top of box, 75% beaten) and 75th percentile (bottom of box, 25% beaten) of the peer universe.Fidelity Mid-Cap Stock Fund
Fidelity Mid-Cap Stock Fund
Corporate Headquarters
245 Summer St.
Boston, MA 02210
www.fidelity.com
MCS-SANN-1216
1.538556.119
Fidelity® Mid-Cap Stock Fund Semi-Annual Report October 31, 2016 |
Contents
Board Approval of Investment Advisory Contracts and Management Fees |
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 1-800-835-5092 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. © 2016 FMR LLC. All rights reserved.
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, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Fund nor Fidelity Distributors Corporation is a bank.
Investment Summary (Unaudited)
Top Ten Stocks as of October 31, 2016
% of fund's net assets | % of fund's net assets 6 months ago | |
The Williams Companies, Inc. | 2.2 | 1.2 |
Eurofins Scientific SA | 2.0 | 1.8 |
Williams Partners LP | 1.5 | 1.3 |
Boston Scientific Corp. | 1.4 | 1.5 |
ARAMARK Holdings Corp. | 1.3 | 1.3 |
First Data Corp. Class A | 1.3 | 0.7 |
First American Financial Corp. | 1.3 | 1.2 |
Atmos Energy Corp. | 1.2 | 1.3 |
Alliant Energy Corp. | 1.2 | 1.1 |
Aspen Technology, Inc. | 1.2 | 0.5 |
14.6 |
Top Five Market Sectors as of October 31, 2016
% of fund's net assets | % of fund's net assets 6 months ago | |
Information Technology | 18.0 | 16.8 |
Financials | 13.1 | 18.1 |
Consumer Discretionary | 11.6 | 13.8 |
Industrials | 10.8 | 13.3 |
Energy | 10.7 | 10.9 |
Prior period industry classifications reflect the categories in place as of the date indicated and have not been adjusted to reflect current industry classifications.
Asset Allocation (% of fund's net assets)
As of October 31, 2016 * | ||
Stocks | 90.2% | |
Bonds | 0.1% | |
Short-Term Investments and Net Other Assets (Liabilities) | 9.7% |
* Foreign investments - 11.3%
As of April 30, 2016 * | ||
Stocks | 93.8% | |
Bonds | 0.1% | |
Short-Term Investments and Net Other Assets (Liabilities) | 6.1% |
* Foreign investments - 10.8%
Investments October 31, 2016 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 90.2% | |||
Shares | Value (000s) | ||
CONSUMER DISCRETIONARY - 11.6% | |||
Auto Components - 0.6% | |||
Magna International, Inc. Class A (sub. vtg.) | 577,900 | $23,727 | |
Tenneco, Inc. (a) | 327,000 | 18,008 | |
41,735 | |||
Distributors - 0.8% | |||
Pool Corp. | 596,001 | 55,178 | |
Hotels, Restaurants & Leisure - 2.5% | |||
ARAMARK Holdings Corp. | 2,620,940 | 97,578 | |
Domino's Pizza, Inc. | 330,400 | 55,917 | |
Noodles & Co. (a)(b)(c) | 2,368,600 | 11,132 | |
Whitbread PLC | 408,943 | 18,095 | |
182,722 | |||
Household Durables - 3.4% | |||
D.R. Horton, Inc. | 1,213,633 | 34,989 | |
Lennar Corp. Class A | 587,400 | 24,489 | |
NVR, Inc. (a) | 54,700 | 83,308 | |
Tempur Sealy International, Inc. (a)(b) | 842,600 | 45,559 | |
Toll Brothers, Inc. (a) | 2,123,887 | 58,279 | |
246,624 | |||
Internet & Direct Marketing Retail - 0.1% | |||
Etsy, Inc. (a) | 592,600 | 7,692 | |
Leisure Products - 0.5% | |||
New Academy Holding Co. LLC unit (a)(d)(e) | 294,000 | 32,702 | |
Media - 0.2% | |||
WME Entertainment Parent, LLC Class A unit (e)(f) | 8,196,036 | 16,835 | |
Specialty Retail - 2.5% | |||
AutoZone, Inc. (a) | 39,100 | 29,018 | |
Citi Trends, Inc. (c) | 892,953 | 17,734 | |
Ross Stores, Inc. | 481,400 | 30,107 | |
Sally Beauty Holdings, Inc. (a) | 895,200 | 23,221 | |
Tiffany & Co., Inc. (b) | 759,800 | 55,785 | |
Ulta Salon, Cosmetics & Fragrance, Inc. (a) | 85,100 | 20,708 | |
176,573 | |||
Textiles, Apparel & Luxury Goods - 1.0% | |||
Brunello Cucinelli SpA (b) | 2,079,700 | 41,185 | |
PVH Corp. | 309,500 | 33,110 | |
74,295 | |||
TOTAL CONSUMER DISCRETIONARY | 834,356 | ||
CONSUMER STAPLES - 3.1% | |||
Beverages - 0.5% | |||
Constellation Brands, Inc. Class A (sub. vtg.) | 225,400 | 37,669 | |
Food & Staples Retailing - 0.3% | |||
Tesco PLC (a) | 7,930,600 | 20,427 | |
Food Products - 1.9% | |||
Amira Nature Foods Ltd. (a)(b) | 1,793,975 | 14,065 | |
Amplify Snack Brands, Inc. (a)(b) | 1,322,059 | 19,157 | |
Greencore Group PLC | 2,326,400 | 9,397 | |
Mead Johnson Nutrition Co. Class A | 795,300 | 59,465 | |
The Hershey Co. | 303,200 | 31,066 | |
133,150 | |||
Household Products - 0.4% | |||
Church & Dwight Co., Inc. | 620,346 | 29,938 | |
TOTAL CONSUMER STAPLES | 221,184 | ||
ENERGY - 10.6% | |||
Energy Equipment & Services - 1.3% | |||
FMC Technologies, Inc. (a) | 678,200 | 21,886 | |
Helmerich & Payne, Inc. (b) | 421,600 | 26,607 | |
Oceaneering International, Inc. | 1,745,300 | 41,538 | |
Utica Shale Drilling Program (non-operating revenue interest) unit (e)(f) | 6,799,278 | 6,799 | |
96,830 | |||
Oil, Gas & Consumable Fuels - 9.3% | |||
Antero Resources Corp. (a) | 1,788,200 | 47,334 | |
Cabot Oil & Gas Corp. | 2,075,100 | 43,328 | |
Cimarex Energy Co. | 417,000 | 53,847 | |
Cobalt International Energy, Inc. (a) | 3,103,800 | 2,930 | |
Denbury Resources, Inc. (a)(b) | 4,058,300 | 9,699 | |
Diamondback Energy, Inc. (a) | 525,100 | 47,936 | |
Energy Transfer Equity LP | 2,233,800 | 33,351 | |
GasLog Ltd. (b) | 2,505,926 | 38,466 | |
Golar LNG Ltd. (b) | 1,361,500 | 29,803 | |
Range Resources Corp. | 666,600 | 22,524 | |
SM Energy Co. | 1,460,000 | 49,100 | |
Southwestern Energy Co. (a) | 1,246,800 | 12,954 | |
The Williams Companies, Inc. | 5,410,200 | 157,983 | |
Whiting Petroleum Corp. (a) | 1,761,700 | 14,516 | |
Williams Partners LP | 2,944,100 | 105,458 | |
669,229 | |||
TOTAL ENERGY | 766,059 | ||
FINANCIALS - 13.1% | |||
Banks - 4.8% | |||
First Republic Bank | 1,006,300 | 74,899 | |
FNB Corp., Pennsylvania | 3,720,700 | 48,630 | |
Huntington Bancshares, Inc. | 5,200,600 | 55,126 | |
M&T Bank Corp. | 457,100 | 56,100 | |
Regions Financial Corp. | 3,287,224 | 35,206 | |
SunTrust Banks, Inc. | 843,100 | 38,133 | |
UMB Financial Corp. | 635,100 | 39,408 | |
347,502 | |||
Capital Markets - 0.8% | |||
KKR & Co. LP | 4,039,184 | 57,316 | |
Insurance - 5.9% | |||
Arch Capital Group Ltd. (a) | 1,087,200 | 84,769 | |
Brown & Brown, Inc. | 1,188,900 | 43,823 | |
First American Financial Corp. | 2,418,400 | 94,463 | |
FNF Group | 2,021,400 | 72,588 | |
Jardine Lloyd Thompson Group PLC | 1,682,094 | 21,165 | |
Progressive Corp. | 1,785,300 | 56,255 | |
Willis Group Holdings PLC | 409,500 | 51,556 | |
424,619 | |||
Thrifts & Mortgage Finance - 1.6% | |||
MGIC Investment Corp. (a) | 5,982,309 | 48,816 | |
Radian Group, Inc. | 4,812,544 | 65,402 | |
114,218 | |||
TOTAL FINANCIALS | 943,655 | ||
HEALTH CARE - 9.9% | |||
Health Care Equipment & Supplies - 3.1% | |||
Boston Scientific Corp. (a) | 4,761,700 | 104,757 | |
DexCom, Inc. (a) | 167,000 | 13,066 | |
Teleflex, Inc. | 143,300 | 20,511 | |
The Cooper Companies, Inc. | 377,965 | 66,537 | |
Zeltiq Aesthetics, Inc. (a)(b) | 648,766 | 21,474 | |
226,345 | |||
Health Care Providers & Services - 2.9% | |||
Amplifon SpA | 2,539,682 | 26,848 | |
Corvel Corp. (a) | 242,398 | 8,375 | |
Henry Schein, Inc. (a) | 229,100 | 34,182 | |
MEDNAX, Inc. (a) | 942,200 | 57,710 | |
Premier, Inc. (a) | 583,900 | 18,591 | |
Universal Health Services, Inc. Class B | 501,900 | 60,584 | |
206,290 | |||
Health Care Technology - 0.6% | |||
HealthStream, Inc. (a) | 859,500 | 23,181 | |
Medidata Solutions, Inc. (a) | 398,700 | 19,134 | |
42,315 | |||
Life Sciences Tools & Services - 2.7% | |||
Agilent Technologies, Inc. | 1,185,200 | 51,639 | |
Eurofins Scientific SA | 323,800 | 147,121 | |
198,760 | |||
Pharmaceuticals - 0.6% | |||
Catalent, Inc. (a) | 1,780,650 | 40,617 | |
TOTAL HEALTH CARE | 714,327 | ||
INDUSTRIALS - 10.8% | |||
Aerospace & Defense - 3.3% | |||
Elbit Systems Ltd. | 89,708 | 8,863 | |
KEYW Holding Corp. (a)(b)(c) | 3,804,708 | 39,911 | |
Rockwell Collins, Inc. | 445,900 | 37,598 | |
Space Exploration Technologies Corp. Class A (a)(e) | 96,222 | 10,006 | |
Teledyne Technologies, Inc. (a) | 479,300 | 51,611 | |
Textron, Inc. | 1,411,600 | 56,577 | |
TransDigm Group, Inc. | 130,300 | 35,502 | |
240,068 | |||
Air Freight & Logistics - 1.2% | |||
C.H. Robinson Worldwide, Inc. | 498,600 | 33,965 | |
Expeditors International of Washington, Inc. | 429,457 | 22,104 | |
PostNL NV (a) | 5,708,600 | 26,896 | |
82,965 | |||
Commercial Services & Supplies - 1.0% | |||
KAR Auction Services, Inc. | 719,000 | 30,615 | |
Stericycle, Inc. (a) | 273,900 | 21,937 | |
U.S. Ecology, Inc. | 460,681 | 19,464 | |
72,016 | |||
Construction & Engineering - 0.4% | |||
Jacobs Engineering Group, Inc. (a) | 521,700 | 26,909 | |
Electrical Equipment - 1.8% | |||
AMETEK, Inc. | 1,197,092 | 52,792 | |
Generac Holdings, Inc. (a) | 822,600 | 31,333 | |
Melrose Industries PLC | 11,332,024 | 23,406 | |
Regal Beloit Corp. | 383,400 | 22,659 | |
130,190 | |||
Machinery - 1.4% | |||
Donaldson Co., Inc. | 1,208,000 | 44,116 | |
Pentair PLC | 302,000 | 16,649 | |
Rational AG | 76,500 | 39,680 | |
100,445 | |||
Road & Rail - 0.9% | |||
Genesee & Wyoming, Inc. Class A (a) | 554,700 | 37,686 | |
Kansas City Southern | 324,100 | 28,443 | |
66,129 | |||
Trading Companies & Distributors - 0.8% | |||
Rush Enterprises, Inc. Class A (a) | 743,100 | 19,506 | |
United Rentals, Inc. (a) | 493,073 | 37,306 | |
56,812 | |||
TOTAL INDUSTRIALS | 775,534 | ||
INFORMATION TECHNOLOGY - 18.0% | |||
Communications Equipment - 1.0% | |||
Brocade Communications Systems, Inc. | 4,616,900 | 48,939 | |
Juniper Networks, Inc. | 822,700 | 21,670 | |
70,609 | |||
Electronic Equipment & Components - 4.2% | |||
Amphenol Corp. Class A | 1,128,900 | 74,428 | |
Arrow Electronics, Inc. (a) | 1,337,000 | 81,717 | |
CDW Corp. | 554,000 | 24,880 | |
Fabrinet (a) | 1,123,931 | 42,664 | |
IPG Photonics Corp. (a) | 338,500 | 32,838 | |
Keysight Technologies, Inc. (a) | 1,538,000 | 50,446 | |
306,973 | |||
Internet Software & Services - 1.9% | |||
Akamai Technologies, Inc. (a) | 1,102,600 | 76,598 | |
Endurance International Group Holdings, Inc. (a)(b) | 2,358,600 | 17,336 | |
GoDaddy, Inc. (a)(b) | 1,134,800 | 40,614 | |
134,548 | |||
IT Services - 5.1% | |||
Fidelity National Information Services, Inc. | 667,186 | 49,318 | |
First Data Corp. Class A (a) | 6,893,773 | 96,444 | |
Fiserv, Inc. (a) | 538,000 | 52,982 | |
FleetCor Technologies, Inc. (a) | 340,100 | 59,620 | |
Leidos Holdings, Inc. | 434,500 | 18,062 | |
Total System Services, Inc. | 627,800 | 31,315 | |
WNS Holdings Ltd. sponsored ADR (a) | 2,109,100 | 58,000 | |
365,741 | |||
Semiconductors & Semiconductor Equipment - 1.8% | |||
Lam Research Corp. | 286,500 | 27,750 | |
Linear Technology Corp. | 386,500 | 23,213 | |
Maxim Integrated Products, Inc. | 760,900 | 30,154 | |
Silicon Laboratories, Inc. (a) | 529,694 | 31,755 | |
Xilinx, Inc. | 381,200 | 19,392 | |
132,264 | |||
Software - 4.0% | |||
ANSYS, Inc. (a) | 892,300 | 81,512 | |
Aspen Technology, Inc. (a) | 1,727,100 | 85,042 | |
Citrix Systems, Inc. (a) | 751,000 | 63,685 | |
Mobileye NV (a) | 806,000 | 29,967 | |
Red Hat, Inc. (a) | 373,500 | 28,928 | |
289,134 | |||
TOTAL INFORMATION TECHNOLOGY | 1,299,269 | ||
MATERIALS - 2.8% | |||
Chemicals - 0.8% | |||
Albemarle Corp. U.S. | 366,300 | 30,604 | |
Ingevity Corp. (a) | 193,966 | 8,030 | |
Potash Corp. of Saskatchewan, Inc. | 1,240,900 | 20,177 | |
58,811 | |||
Containers & Packaging - 0.8% | |||
WestRock Co. | 1,163,800 | 53,756 | |
Metals & Mining - 1.2% | |||
Franco-Nevada Corp. | 344,600 | 22,555 | |
Freeport-McMoRan, Inc. | 1,605,500 | 17,949 | |
Newcrest Mining Ltd. (a) | 1,294,685 | 22,219 | |
Novagold Resources, Inc. (a) | 5,148,776 | 25,757 | |
88,480 | |||
TOTAL MATERIALS | 201,047 | ||
REAL ESTATE - 4.6% | |||
Equity Real Estate Investment Trusts (REITs) - 4.2% | |||
Apartment Investment& Management Co. Class A | 918,000 | 40,456 | |
Cousins Properties, Inc. | 5,274,191 | 40,980 | |
Essex Property Trust, Inc. | 264,200 | 56,563 | |
Healthcare Realty Trust, Inc. | 1,648,900 | 52,583 | |
Healthcare Trust of America, Inc. | 1,117,200 | 34,186 | |
National Retail Properties, Inc. | 359,800 | 16,414 | |
Parkway, Inc. (a) | 659,273 | 11,880 | |
VEREIT, Inc. | 5,322,700 | 50,033 | |
303,095 | |||
Real Estate Management & Development - 0.4% | |||
Realogy Holdings Corp. | 1,142,800 | 26,159 | |
TOTAL REAL ESTATE | 329,254 | ||
TELECOMMUNICATION SERVICES - 0.2% | |||
Diversified Telecommunication Services - 0.2% | |||
Iridium Communications, Inc. (a)(b) | 1,820,300 | 14,835 | |
UTILITIES - 5.5% | |||
Electric Utilities - 4.0% | |||
Alliant Energy Corp. | 2,310,400 | 87,911 | |
IDACORP, Inc. | 954,133 | 74,794 | |
OGE Energy Corp. | 2,184,600 | 67,810 | |
Xcel Energy, Inc. | 1,354,982 | 56,300 | |
286,815 | |||
Gas Utilities - 1.5% | |||
Atmos Energy Corp. | 1,221,897 | 90,897 | |
Spire, Inc. | 335,000 | 21,038 | |
111,935 | |||
TOTAL UTILITIES | 398,750 | ||
TOTAL COMMON STOCKS | |||
(Cost $5,207,460) | 6,498,270 | ||
Principal Amount (000s) | Value (000s) | ||
Nonconvertible Bonds - 0.1% | |||
ENERGY - 0.1% | |||
Energy Equipment & Services - 0.1% | |||
Pacific Drilling SA 5.375% 6/1/20 (g) | |||
(Cost $15,957) | 26,270 | 7,487 | |
Shares | Value (000s) | ||
Money Market Funds - 12.1% | |||
Fidelity Cash Central Fund, 0.41% (h) | 687,500,220 | 687,706 | |
Fidelity Securities Lending Cash Central Fund 0.48% (h)(i) | 183,031,793 | 183,068 | |
TOTAL MONEY MARKET FUNDS | |||
(Cost $870,619) | 870,774 | ||
TOTAL INVESTMENT PORTFOLIO - 102.4% | |||
(Cost $6,094,036) | 7,376,531 | ||
NET OTHER ASSETS (LIABILITIES) - (2.4)% | (171,183) | ||
NET ASSETS - 100% | $7,205,348 |
Legend
(a) Non-income producing
(b) Security or a portion of the security is on loan at period end.
(c) Affiliated company
(d) Investment is owned by an entity that is treated as a U.S. Corporation for tax purposes in which the Fund holds a percentage ownership.
(e) Restricted securities - Investment in securities not registered under the Securities Act of 1933 (excluding 144A issues). At the end of the period, the value of restricted securities (excluding 144A issues) amounted to $66,342,000 or 0.9% of net assets.
(f) Investment is owned by a wholly-owned subsidiary (Subsidiary) that is treated as a corporation for U.S. tax purposes.
(g) 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 $7,487,000 or 0.1% of net assets.
(h) Affiliated fund that is generally 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. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
(i) Investment made with cash collateral received from securities on loan.
Additional information on each restricted holding is as follows:
Security | Acquisition Date | Acquisition Cost (000s) |
New Academy Holding Co. LLC unit | 8/1/11 | $30,988 |
Space Exploration Technologies Corp. Class A | 4/8/16 | $9,278 |
Utica Shale Drilling Program (non-operating revenue interest) unit | 10/5/16 | $6,799 |
WME Entertainment Parent, LLC Class A unit | 8/16/16 | $16,835 |
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 |
(Amounts in thousands) | |
Fidelity Cash Central Fund | $984 |
Fidelity Securities Lending Cash Central Fund | 1,295 |
Total | $2,279 |
Other Affiliated Issuers
An affiliated company is a company in which the Fund has ownership of at least 5% of the voting securities. Fiscal year to date transactions with companies which are or were affiliates are as follows:
Affiliate (Amounts in thousands) | Value, beginning of period | Purchases | Sales Proceeds* | Dividend Income | Value, end of period |
Citi Trends, Inc. | $16,152 | $-- | $103 | $107 | $17,734 |
KEYW Holding Corp. | 24,249 | 3,384 | 201 | -- | 39,911 |
Noodles & Co. | 26,599 | -- | 172 | -- | 11,132 |
Total | $67,000 | $3,384 | $476 | $107 | $68,777 |
* Includes the value of securities delivered through in-kind transactions, if applicable.
Investment Valuation
The following is a summary of the inputs used, as of October 31, 2016, involving the Fund's assets and liabilities carried at fair 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 below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
Valuation Inputs at Reporting Date: | ||||
Description | Total | Level 1 | Level 2 | Level 3 |
(Amounts in thousands) | ||||
Investments in Securities: | ||||
Equities: | ||||
Consumer Discretionary | $834,356 | $784,819 | $-- | $49,537 |
Consumer Staples | 221,184 | 200,757 | 20,427 | -- |
Energy | 766,059 | 759,260 | -- | 6,799 |
Financials | 943,655 | 943,655 | -- | -- |
Health Care | 714,327 | 714,327 | -- | -- |
Industrials | 775,534 | 765,528 | -- | 10,006 |
Information Technology | 1,299,269 | 1,299,269 | -- | -- |
Materials | 201,047 | 201,047 | -- | -- |
Real Estate | 329,254 | 329,254 | -- | -- |
Telecommunication Services | 14,835 | 14,835 | -- | -- |
Utilities | 398,750 | 398,750 | -- | -- |
Corporate Bonds | 7,487 | -- | 7,487 | -- |
Money Market Funds | 870,774 | 870,774 | -- | -- |
Total Investments in Securities: | $7,376,531 | $7,282,275 | $27,914 | $66,342 |
Other Information
Distribution of investments by country or territory of incorporation, as a percentage of Total Net Assets, is as follows (Unaudited):
United States of America | 88.7% |
Luxembourg | 2.1% |
Bermuda | 2.1% |
Canada | 1.3% |
United Kingdom | 1.1% |
Italy | 1.0% |
Others (Individually Less Than 1%) | 3.7% |
100.0% |
See accompanying notes which are an integral part of the financial statements.
Financial Statements
Statement of Assets and Liabilities
Amounts in thousands (except per-share amounts) | October 31, 2016 (Unaudited) | |
Assets | ||
Investment in securities, at value (including securities loaned of $176,226) — See accompanying schedule: Unaffiliated issuers (cost $5,111,738) | $6,436,980 | |
Fidelity Central Funds (cost $870,619) | 870,774 | |
Other affiliated issuers (cost $111,679) | 68,777 | |
Total Investments (cost $6,094,036) | $7,376,531 | |
Receivable for investments sold | 13,830 | |
Receivable for fund shares sold | 3,507 | |
Dividends receivable | 4,750 | |
Interest receivable | 588 | |
Distributions receivable from Fidelity Central Funds | 427 | |
Prepaid expenses | 19 | |
Other receivables | 478 | |
Total assets | 7,400,130 | |
Liabilities | ||
Payable for investments purchased | $1,172 | |
Payable for fund shares redeemed | 6,239 | |
Accrued management fee | 2,983 | |
Other affiliated payables | 904 | |
Other payables and accrued expenses | 458 | |
Collateral on securities loaned, at value | 183,026 | |
Total liabilities | 194,782 | |
Net Assets | $7,205,348 | |
Net Assets consist of: | ||
Paid in capital | $5,712,744 | |
Undistributed net investment income | 29,451 | |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | 180,663 | |
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies | 1,282,490 | |
Net Assets | $7,205,348 | |
Mid-Cap Stock: | ||
Net Asset Value, offering price and redemption price per share ($5,203,821 ÷ 154,042 shares) | $33.78 | |
Class K: | ||
Net Asset Value, offering price and redemption price per share ($2,001,527 ÷ 59,201 shares) | $33.81 |
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Amounts in thousands | Six months ended October 31, 2016 (Unaudited) | |
Investment Income | ||
Dividends (including $107 earned from other affiliated issuers) | $47,559 | |
Interest | 1,636 | |
Income from Fidelity Central Funds | 2,279 | |
Total income | 51,474 | |
Expenses | ||
Management fee | ||
Basic fee | $19,849 | |
Performance adjustment | (3,367) | |
Transfer agent fees | 4,815 | |
Accounting and security lending fees | 612 | |
Custodian fees and expenses | 61 | |
Independent trustees' fees and expenses | 16 | |
Registration fees | 56 | |
Audit | 39 | |
Legal | 12 | |
Miscellaneous | 37 | |
Total expenses before reductions | 22,130 | |
Expense reductions | (205) | 21,925 |
Net investment income (loss) | 29,549 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | 190,561 | |
Fidelity Central Funds | 3 | |
Other affiliated issuers | (129) | |
Foreign currency transactions | (32) | |
Total net realized gain (loss) | 190,403 | |
Change in net unrealized appreciation (depreciation) on: Investment securities | 114,367 | |
Assets and liabilities in foreign currencies | (14) | |
Total change in net unrealized appreciation (depreciation) | 114,353 | |
Net gain (loss) | 304,756 | |
Net increase (decrease) in net assets resulting from operations | $334,305 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Amounts in thousands | Six months ended October 31, 2016 (Unaudited) | Year ended April 30, 2016 |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $29,549 | $46,833 |
Net realized gain (loss) | 190,403 | 857,446 |
Change in net unrealized appreciation (depreciation) | 114,353 | (1,201,757) |
Net increase (decrease) in net assets resulting from operations | 334,305 | (297,478) |
Distributions to shareholders from net investment income | (17,748) | (48,569) |
Distributions to shareholders from net realized gain | (366,839) | (930,371) |
Total distributions | (384,587) | (978,940) |
Share transactions - net increase (decrease) | 131,662 | (61,224) |
Redemption fees | 21 | 35 |
Total increase (decrease) in net assets | 81,401 | (1,337,607) |
Net Assets | ||
Beginning of period | 7,123,947 | 8,461,554 |
End of period | $7,205,348 | $7,123,947 |
Other Information | ||
Undistributed net investment income end of period | $29,451 | $17,650 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Mid-Cap Stock Fund
Six months ended (Unaudited) October 31, | Years ended April 30, | |||||
2016 | 2016 | 2015 | 2014 | 2013 | 2012 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $34.07 | $40.11 | $40.26 | $33.69 | $30.15 | $31.78 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .13 | .21 | .18 | .10 | .29 | .10 |
Net realized and unrealized gain (loss) | 1.43 | (1.54) | 3.52 | 7.69 | 4.45 | (.18) |
Total from investment operations | 1.56 | (1.33) | 3.70 | 7.79 | 4.74 | (.08) |
Distributions from net investment income | (.08) | (.22) | (.09) | (.08) | (.33) | (.05) |
Distributions from net realized gain | (1.77) | (4.49) | (3.76) | (1.14) | (.87) | (1.50) |
Total distributions | (1.85) | (4.71) | (3.85) | (1.22) | (1.20) | (1.55) |
Redemption fees added to paid in capitalA,B | – | – | – | – | – | – |
Net asset value, end of period | $33.78 | $34.07 | $40.11 | $40.26 | $33.69 | $30.15 |
Total ReturnC,D | 4.73% | (3.44)% | 9.83% | 23.50% | 16.54% | .19% |
Ratios to Average Net AssetsE,F | ||||||
Expenses before reductions | .64%G | .72% | .73% | .78% | .65% | .86% |
Expenses net of fee waivers, if any | .64%G | .72% | .72% | .78% | .65% | .86% |
Expenses net of all reductions | .64%G | .72% | .72% | .78% | .63% | .85% |
Net investment income (loss) | .78%G | .59% | .46% | .25% | .95% | .36% |
Supplemental Data | ||||||
Net assets, end of period (in millions) | $5,204 | $5,136 | $5,874 | $5,966 | $4,750 | $5,170 |
Portfolio turnover rateH | 30%G,I | 23%I | 29% | 27% | 46% | 52% |
A Calculated based on average shares outstanding during the period.
B Amount represents less than $.005 per share.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Fees and expenses of any 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 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.
G Annualized
H Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
I Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Mid-Cap Stock Fund Class K
Six months ended (Unaudited) October 31, | Years ended April 30, | |||||
2016 | 2016 | 2015 | 2014 | 2013 | 2012 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $34.08 | $40.12 | $40.27 | $33.68 | $30.15 | $31.77 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .15 | .25 | .22 | .15 | .33 | .15 |
Net realized and unrealized gain (loss) | 1.44 | (1.54) | 3.51 | 7.69 | 4.45 | (.19) |
Total from investment operations | 1.59 | (1.29) | 3.73 | 7.84 | 4.78 | (.04) |
Distributions from net investment income | (.10) | (.26) | (.13) | (.12) | (.38) | (.08) |
Distributions from net realized gain | (1.77) | (4.49) | (3.76) | (1.14) | (.87) | (1.50) |
Total distributions | (1.86)B | (4.75) | (3.88)C | (1.25)D | (1.25) | (1.58) |
Redemption fees added to paid in capitalA,E | – | – | – | – | – | – |
Net asset value, end of period | $33.81 | $34.08 | $40.12 | $40.27 | $33.68 | $30.15 |
Total ReturnF,G | 4.83% | (3.33)% | 9.92% | 23.67% | 16.72% | .35% |
Ratios to Average Net AssetsH,I | ||||||
Expenses before reductions | .52%J | .60% | .61% | .65% | .50% | .69% |
Expenses net of fee waivers, if any | .52%J | .60% | .61% | .65% | .50% | .69% |
Expenses net of all reductions | .52%J | .60% | .61% | .65% | .48% | .68% |
Net investment income (loss) | .90%J | .71% | .57% | .39% | 1.11% | .52% |
Supplemental Data | ||||||
Net assets, end of period (in millions) | $2,002 | $1,988 | $2,588 | $2,927 | $2,447 | $1,643 |
Portfolio turnover rateK | 30%J,L | 23%L | 29% | 27% | 46% | 52% |
A Calculated based on average shares outstanding during the period.
B Total distributions of $1.86 per share is comprised of distributions from net investment income of $.095 and distributions from net realized gain of $1.769 per share.
C Total distributions of $3.88 per share is comprised of distributions from net investment income of $.127 and distributions from net realized gain of $3.757 per share.
D Total distributions of $1.25 per share is comprised of distributions from net investment income of $.116 and distributions from net realized gain of $1.136 per share.
E Amount represents less than $.005 per share.
F Total returns for periods of less than one year are not annualized.
G Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
H Fees and expenses of any 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.
I 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.
J Annualized
K Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
L Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended October 31, 2016
(Amounts in thousands except percentages)
1. Organization.
Fidelity Mid-Cap Stock Fund (the Fund) is a fund of Fidelity Concord Street Trust (the Trust) (formerly a fund of Fidelity Commonwealth 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 Mid-Cap Stock and Class K shares, each of which has equal rights as to assets and voting privileges. Each class has exclusive voting rights with respect to matters that affect that class.
2. Investments in Fidelity Central Funds.
The Fund invests in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser 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 the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website 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. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Trustees (the Board) has delegated the day to day responsibility for the valuation of the Fund's investments to the Fair Value Committee (the Committee) established by the Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, the Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment 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 Committee oversees the Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing the Fund's investments and ratifies the fair value determinations of the Committee.
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)
Valuation techniques used to value the Fund's investments by major category are as follows:
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing vendor 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 or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For foreign equity securities, when market or security specific events arise, comparisons to the valuation of American Depositary Receipts (ADRs), futures contracts, Exchange-Traded Funds (ETFs) and certain indexes as well as quoted prices for similar securities may be used and would be categorized as Level 2 in the hierarchy. Utilizing these techniques may result in transfers between Level 1 and Level 2. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Debt securities, including restricted securities, are valued based on evaluated prices received from third party pricing vendors or from brokers who make markets in such securities. Corporate bonds are valued by pricing vendors who utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type or by broker-supplied prices. When independent prices are unavailable or unreliable, debt securities may be valued utilizing pricing methodologies which consider similar factors that would be used by third party pricing vendors. Debt securities are generally categorized as Level 2 in the hierarchy but may be Level 3 depending on the circumstances.
Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
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 October 31, 2016 is included at the end of the Fund's Schedule of Investments.
Foreign Currency. The Fund may use 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 rates 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 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. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Distributions received on securities that represent a return of capital or capital gain are recorded as a reduction of cost of investments and/or as a realized gain. Subsequent to ex-dividend date the Fund determines the components of these distributions, based upon receipt of tax filings or other correspondence relating to the underlying investment. Interest income is accrued as earned and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.
Class Allocations and Expenses. Investment income, realized and unrealized capital gains and losses, common expenses of the Fund, and certain fund-level expense reductions, if any, are allocated daily 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 fees incurred. Certain expense reductions may also differ by class. For the reporting period, the allocated portion of income and expenses to each class as a percent of its average net assets may vary due to the timing of recording these transactions in relation to fluctuating net assets of the classes. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Deferred Trustee Compensation. Under a Deferred Compensation Plan (the Plan), independent Trustees may elect to defer receipt of a portion of their annual compensation. Deferred amounts are invested in a cross-section of Fidelity funds, are marked-to-market and remain in the Fund until distributed in accordance with the Plan. The investment of deferred amounts and the offsetting payable to the Trustees are included in the accompanying Statement of Assets and Liabilities.
Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. The Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction. Foreign taxes are provided for based on the Fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.
Distributions are declared and 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. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to foreign currency transactions, partnerships, passive foreign investment companies (PFIC), market discount, redemptions in kind, deferred trustees compensation and losses deferred due to wash sales and excise tax regulations.
The federal tax cost of investment securities and unrealized appreciation (depreciation) as of period end were as follows:
Gross unrealized appreciation | $1,751,282 |
Gross unrealized depreciation | (467,630) |
Net unrealized appreciation (depreciation) on securities | $1,283,652 |
Tax cost | $6,092,879 |
Short-Term Trading (Redemption) Fees. Shares held by investors in the Fund less than 30 days may have been subject to a redemption fee equal to .75% of the NAV of shares redeemed. All redemption fees, which reduce the proceeds of the shareholder redemption, are retained by the Fund and accounted for as an addition to paid in capital. In November 2016, the Board of Trustees approved the elimination of these redemption fees effective December 12, 2016.
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.
Consolidated Subsidiary. The Fund invests in certain investments through a wholly-owned subsidiary ("Subsidiary"), which may be subject to federal and state taxes upon disposition.
As of period end, the Fund held an investment of $23,634 in these Subsidiaries, representing .33% of the Fund's net assets. The financial statements have been consolidated and include accounts of the Fund and each Subsidiary. Accordingly, all inter-company transactions and balances have been eliminated.
4. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities and in-kind transactions, aggregated $1,022,607 and $1,440,670, respectively.
Redemptions In-Kind. During the period, 1,430 shares of the Fund held by an unaffiliated entity were redeemed in-kind for investments, including accrued interest, with a value of $47,905. The net realized gain of $12,613 on investments delivered through the in-kind redemptions is included in the accompanying Statement of Operations. The amount of the redemptions is included in share transactions in the accompanying Statement of Changes in Net Assets as well as Note 10: Share Transactions. The Fund recognized no gain or loss for federal income tax purposes.
Prior Fiscal Year Redemptions In-Kind. During the prior period, 7,169 shares of the Fund held by unaffiliated entities were redeemed in-kind for investments, including accrued interest, and cash with a value of $265,315. The Fund had a net realized gain of $85,469 on investments delivered through the in-kind redemptions. The amount of the redemptions is included in share transactions in the accompanying Statement of Changes in Net Assets as well as Note 10: Share Transactions. The Fund recognized no gain or loss for federal income tax purposes.
5. Fees and Other Transactions with Affiliates.
Management Fee. Fidelity Management & Research Company (the investment adviser) and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .30% of the Fund's average net assets and an annualized group fee rate that averaged .25% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by the investment adviser, including any mutual funds previously advised by the investment adviser that are currently advised by Fidelity SelectCo, LLC, an affiliate of the investment adviser. The group fee rate decreases as assets under management increase and increases as assets under management decrease. In addition, the management fee is subject to a performance adjustment (up to a maximum of +/- .20% of the Fund's average net assets over a 36 month performance period). The upward or downward adjustment to the management fee is based on the relative investment performance of Mid-Cap Stock as compared to its benchmark index, the S&P MidCap 400 Index, over the same 36 month performance period. For the reporting period, the total annualized management fee rate, including the performance adjustment, was .45% of the Fund's average net assets. The performance adjustment included in the management fee rate may be higher or lower than the maximum performance adjustment rate due to the difference between the average net assets for the reporting and performance periods.
Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc., (FIIOC), an affiliate of the investment adviser, 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 Mid-Cap Stock. FIIOC receives an asset-based fee of Class K's average net assets. FIIOC pays for typesetting, printing and mailing of shareholder reports, except proxy statements.
For the period, transfer agent fees for each class were as follows:
Amount | % of Class-Level Average Net Assets(a) | |
Mid-Cap Stock | $4,342 | .17 |
Class K | 473 | .05 |
$ 4,815 |
(a) Annualized
Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of the investment adviser, maintains the Fund's accounting records. The accounting fee is based on the level of average net assets for each 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.
Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. Brokerage commissions are included in net realized gain (loss) and change in net unrealized appreciation (depreciation) in the Statement of Operations. The commissions paid to these affiliated firms were $54 for the period.
Interfund Trades. The Fund may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
6. Committed Line of Credit.
The Fund participates with other funds managed by the investment adviser or an affiliate in a $4.25 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 $12 and is reflected in Miscellaneous expenses on the Statement of Operations. During the period, the Fund did not borrow on this line of credit.
7. Security Lending.
The Fund lends portfolio securities through a lending agent from time to time in order to earn additional income. For equity securities, a lending agent is used and may loan securities to certain qualified borrowers, including Fidelity Capital Markets (FCM), a broker-dealer affiliated with the Fund. On the settlement date of the loan, the Fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the Fund and any additional required collateral is delivered to the Fund on the next business day. The Fund or borrower may terminate the loan at any time, and if the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, the Fund may apply collateral received from the borrower against the obligation. The Fund may experience delays and costs in recovering the securities loaned. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. The value of securities loaned to FCM at period end was $10,446. Security lending income represents the income earned on investing cash collateral, less rebates paid to borrowers and any lending agent fees associated with the loan, plus any premium payments received for lending certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds. Total security lending income during the period amounted to $1,295, including $47 from securities loaned to FCM.
8. Expense Reductions.
Commissions paid to certain brokers with whom the investment adviser, or its affiliates, places trades on behalf of the Fund include an amount in addition to trade execution, which may be rebated back to the Fund to offset certain expenses. This amount totaled $178 for the period.
In addition, during the period the investment adviser reimbursed and/or waived a portion of fund-level operating expenses in the amount of $27.
9. Distributions to Shareholders.
Distributions to shareholders of each class were as follows:
Six months ended October 31, 2016 | Year ended April 30, 2016 | |
From net investment income | ||
Mid-Cap Stock | $12,316 | $32,540 |
Class K | 5,432 | 16,029 |
Total | $17,748 | $48,569 |
From net realized gain | ||
Mid-Cap Stock | $265,698 | $657,512 |
Class K | 101,141 | 272,859 |
Total | $366,839 | $930,371 |
10. Share Transactions.
Share transactions for each class were as follows and may contain automatic conversions between classes or exchanges between affiliated funds:
Shares | Shares | Dollars | Dollars | |
Six months ended October 31, 2016 | Year ended April 30, 2016 | Six months ended October 31, 2016 | Year ended April 30, 2016 | |
Mid-Cap Stock | ||||
Shares sold | 6,994 | 11,317 | $237,186 | $392,342 |
Reinvestment of distributions | 8,069 | 18,581 | 265,395 | 658,782 |
Shares redeemed | (11,765) | (25,606) | (397,504) | (889,201) |
Net increase (decrease) | 3,298 | 4,292 | $105,077 | $161,923 |
Class K | ||||
Shares sold | 6,121 | 10,618 | $206,952 | $370,206 |
Reinvestment of distributions | 3,239 | 8,154 | 106,573 | 288,888 |
Shares redeemed | (8,490)(a) | (24,946)(b) | (286,940)(a) | (882,241)(b) |
Net increase (decrease) | 870 | (6,174) | $26,585 | $(223,147) |
(a) Amount includes in-kind redemptions (see Note 4: Redemptions In-Kind).
(b) Amount includes in-kind redemptions (see Note 4: Prior Fiscal Year Redemptions In-Kind).
11. 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.
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including redemption fees and (2) ongoing costs, including management fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (May 1, 2016 to October 31, 2016).
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. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. 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. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. 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.
Annualized Expense Ratio-A | Beginning Account Value May 1, 2016 | Ending Account Value October 31, 2016 | Expenses Paid During Period-B May 1, 2016 to October 31, 2016 | |
Mid-Cap Stock | .64% | |||
Actual | $1,000.00 | $1,047.30 | $3.30 | |
Hypothetical-C | $1,000.00 | $1,021.98 | $3.26 | |
Class K | .52% | |||
Actual | $1,000.00 | $1,048.30 | $2.68 | |
Hypothetical-C | $1,000.00 | $1,022.58 | $2.65 |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).
C 5% return per year before expenses
Board Approval of Investment Advisory Contracts and Management Fees
Fidelity Mid-Cap Stock Fund
Each year, the Board of Trustees, including the Independent Trustees (together, the Board), votes on the renewal of the management contract with Fidelity Management & Research Company (FMR) and the sub-advisory agreements (together, the Advisory Contracts) for the fund. The Board, assisted by the advice of fund counsel and Independent Trustees' counsel, requests and considers a broad range of information relevant to the renewal of the Advisory Contracts throughout the year.
The Board meets regularly and, at each of its meetings, covers an extensive agenda of topics and materials and considers factors that are relevant to its annual consideration of the renewal of the fund's Advisory Contracts, including the services and support provided to the fund and its shareholders. The Board has established various standing committees (Committees), each composed of and chaired by Independent Trustees with varying backgrounds, to which the Board has assigned specific subject matter responsibilities in order to enhance effective decision-making by the Board. The Board, acting directly and through its Committees, requests and receives information concerning the annual consideration of the renewal of the fund's Advisory Contracts. The Board also meets as needed to consider matters specifically related to the Board's annual consideration of the renewal of the Advisory Contracts. Members of the Board may also meet with trustees of other Fidelity funds through ad hoc joint committees to discuss certain matters relevant to all of the Fidelity funds.
At its July 2016 meeting, the Board unanimously determined to renew the fund's Advisory Contracts. In reaching its determination, the Board considered all factors it believed relevant, including (i) the nature, extent, and quality of the services to be provided to the fund and its shareholders (including the investment performance of the fund); (ii) the competitiveness of the fund's management fee and total expense ratio relative to peer funds; (iii) the total costs of the services to be provided by and the profits to be realized by Fidelity from its relationships with the fund; and (iv) the extent to which, if any, economies of scale exist and would be realized as the fund grows, and whether any economies of scale are appropriately shared with fund shareholders.
In considering whether to renew the Advisory Contracts for the fund, the Board reached a determination, with the assistance of fund counsel and Independent Trustees' counsel and through the exercise of its business judgment, that the renewal of the Advisory Contracts was in the best interests of the fund and its shareholders and that the compensation payable under the Advisory Contracts was fair and reasonable. The Board's decision to renew the Advisory Contracts was not based on any single factor, but rather was based on a comprehensive consideration of all the information provided to the Board at its meetings throughout the year. The Board, in reaching its determination to renew the Advisory Contracts, was aware that shareholders of the fund have a broad range of investment choices available to them, including a wide choice among funds offered by Fidelity's competitors, and that the fund's shareholders, who have the opportunity to review and weigh the disclosure provided by the fund in its prospectus and other public disclosures, have chosen to invest in this fund, which is part of the Fidelity family of funds.
Nature, Extent, and Quality of Services Provided. The Board considered Fidelity's staffing as it relates to the fund, including the backgrounds of investment personnel of Fidelity, and also considered the fund's investment objective, strategies, and related investment philosophy. The Independent Trustees also had discussions with senior management of Fidelity's investment operations and investment groups. The Board considered the structure of the investment personnel compensation program and whether this structure provides appropriate incentives to act in the best interests of the fund. Additionally, the Board considered the portfolio managers' investments, if any, in the funds that they manage.Resources Dedicated to Investment Management and Support Services. The Board and the Fund Oversight and Research Committees reviewed the general qualifications and capabilities of Fidelity's investment staff, including its size, education, experience, and resources, as well as Fidelity's approach to recruiting, training, managing, and compensating investment personnel. The Board noted that Fidelity has continued to increase the resources devoted to non-U.S. offices, including expansion of Fidelity's global investment organization. The Board also noted that Fidelity's analysts have extensive resources, tools and capabilities that allow them to conduct sophisticated quantitative and fundamental analysis, as well as credit analysis of issuers, counterparties and guarantors. Further, the Board considered that Fidelity's investment professionals have sufficient access to global information and data so as to provide competitive investment results over time, and that those professionals also have access to sophisticated tools that permit them to assess portfolio construction and risk and performance attribution characteristics continuously, as well as to transmit new information and research conclusions rapidly around the world. Additionally, in its deliberations, the Board considered Fidelity's trading, risk management, compliance, and technology and operations capabilities and resources, which are integral parts of the investment management process.Shareholder and Administrative Services. The Board considered (i) the nature, extent, quality, and cost of advisory, administrative, and shareholder services performed by FMR, the sub-advisers (together with FMR, the Investment Advisers), and their affiliates under the Advisory Contracts and under separate agreements covering transfer agency, pricing and bookkeeping, and securities lending services for the fund; (ii) the nature and extent of the supervision of third party service providers, principally custodians, subcustodians, and pricing vendors; and (iii) the resources devoted to, and the record of compliance with, the fund's compliance policies and procedures. The Board also reviewed the allocation of fund brokerage, including allocations to brokers affiliated with the Investment Advisers, the use of brokerage commissions to pay fund expenses, and the use of "soft" commission dollars to pay for research services.The Board noted that the growth of fund assets over time across the complex allows Fidelity to reinvest in the development of services designed to enhance the value or convenience of the Fidelity funds as investment vehicles. These services include 24-hour access to account information and market information through telephone representatives and over the Internet, investor education materials and asset allocation tools, and the expanded availability of Fidelity Investor Centers.In 2014, the Board formed an ad hoc Committee on Transfer Agency Fees to review the variety of transfer agency fee structures throughout the industry and Fidelity's competitive positioning with respect to industry participants.Investment in a Large Fund Family. The Board considered the benefits to shareholders of investing in a Fidelity fund, including the benefits of investing in a fund that is part of a large family of funds offering a variety of investment disciplines and providing a large variety of mutual fund investor services. The Board noted that Fidelity had taken, or had made recommendations that resulted in the Fidelity funds taking, a number of actions over the previous year that benefited particular funds, including: (i) continuing to dedicate additional resources to investment research and to the support of the senior management team that oversees asset management; (ii) continuing efforts to enhance Fidelity's global research capabilities; (iii) launching new funds and making other enhancements to meet client needs; (iv) broadening eligibility requirements for certain lower-priced share classes of, and streamlining the fee structure for, certain existing equity index funds; (v) lowering expense caps for certain existing funds and classes to reduce expenses paid by shareholders; (vi) eliminating redemption fees for certain variable insurance product funds and classes; (vii) continuing to launch dedicated lower cost underlying funds to meet portfolio construction needs related to expanding underlying fund options for Fidelity funds of funds, specifically for the Freedom Fund product lines; (viii) launching a lower cost share class for use by the Freedom Index Fund product line; (ix) rationalizing product lines and gaining increased efficiencies through fund mergers and share class consolidations; (x) continuing to develop, acquire and implement systems and technology to improve services to the funds and shareholders, strengthen information security, and increase efficiency; (xi) implementing investment enhancements to further strengthen Fidelity's target date product line to increase investors' probability of success in achieving their goals; (xii) accelerating the conversion of all remaining Class B shares to Class A shares, which have a lower expense structure; and (xiii) implementing changes to Fidelity's money market fund product line in response to recent regulatory reforms.Investment Performance. The Board considered whether the fund has operated in accordance with its investment objective, as well as its record of compliance with its investment restrictions and its performance history. The Board noted that there was a portfolio management change for the fund in June 2016.The Board took into account discussions with representatives of the Investment Advisers about fund investment performance that occur at Board meetings throughout the year. In this regard the Board noted that as part of regularly scheduled fund reviews and other reports to the Board on fund performance, the Board considers annualized return information for the fund, for different time periods, measured against a securities market index ("benchmark index") and a peer group of funds with similar objectives ("peer group"), if any. In its evaluation of fund investment performance, the Board gave particular attention to information indicating changes in performance of certain Fidelity funds for specific time periods and discussed with the Investment Advisers the reasons for any overperformance or underperformance.In addition to reviewing absolute and relative fund performance, the Independent Trustees periodically consider the appropriateness of fund performance metrics in evaluating the results achieved. In general, the Independent Trustees believe that fund performance should be evaluated based on net performance (after fees and expenses) of both the highest performing and lowest performing fund share classes, where applicable, compared to appropriate benchmark indices, over appropriate time periods that may include full market cycles, and compared to peer groups, as applicable, over the same periods, taking into account relevant factors including the following: general market conditions; issuer-specific information; and fund cash flows and other factors.The Independent Trustees recognize that shareholders evaluate performance on a net basis over their own holding periods, for which one-, three-, and five-year periods are often used as a proxy. For this reason, the performance information reviewed by the Board also included net cumulative calendar year total return information for the fund and an appropriate benchmark index and peer group for the most recent one-, three-, and five-year periods, as shown below. Returns are shown compared to the 25th percentile (top of box, 75% beaten) and 75th percentile (bottom of box, 25% beaten) of the peer universe.Fidelity Mid-Cap Stock Fund
Fidelity Mid-Cap Stock Fund
Corporate Headquarters
245 Summer St.
Boston, MA 02210
www.fidelity.com
MCS-K-SANN-1216
1.863350.108
Fidelity® Series Small Cap Discovery Fund Semi-Annual Report October 31, 2016 |
Contents
Board Approval of Investment Advisory Contracts and Management Fees |
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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, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Fund nor Fidelity Distributors Corporation is a bank.
Investment Summary (Unaudited)
Top Ten Stocks as of October 31, 2016
% of fund's net assets | % of fund's net assets 6 months ago | |
Cullen/Frost Bankers, Inc. | 3.6 | 3.0 |
Team Health Holdings, Inc. | 3.5 | 2.3 |
First Citizen Bancshares, Inc. | 3.1 | 2.8 |
WESCO International, Inc. | 3.0 | 3.2 |
Tech Data Corp. | 2.9 | 2.5 |
KB Home | 2.8 | 3.3 |
TCF Financial Corp. | 2.8 | 2.7 |
j2 Global, Inc. | 2.8 | 2.3 |
Aarons, Inc. Class A | 2.7 | 2.9 |
Ingram Micro, Inc. Class A | 2.6 | 2.5 |
29.8 |
Top Five Market Sectors as of October 31, 2016
% of fund's net assets | % of fund's net assets 6 months ago | |
Financials | 25.3 | 25.3 |
Industrials | 16.5 | 16.1 |
Information Technology | 15.3 | 15.7 |
Consumer Discretionary | 13.9 | 15.1 |
Health Care | 11.9 | 11.6 |
Prior period industry classifications reflect the categories in place as of the date indicated and have not been adjusted to reflect current industry classifications.
Asset Allocation (% of fund's net assets)
As of October 31, 2016 * | ||
Stocks | 97.9% | |
Short-Term Investments and Net Other Assets (Liabilities) | 2.1% |
* Foreign investments - 7.2%
As of April 30, 2016* | ||
Stocks | 98.8% | |
Short-Term Investments and Net Other Assets (Liabilities) | 1.2% |
* Foreign investments - 7.2%
Investments October 31, 2016 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 97.9% | |||
Shares | Value | ||
CONSUMER DISCRETIONARY - 13.9% | |||
Household Durables - 7.2% | |||
KB Home (a) | 3,000,000 | $43,620,000 | |
Meritage Homes Corp. (b) | 1,300,000 | 40,235,000 | |
Taylor Morrison Home Corp. (b) | 1,600,000 | 27,296,000 | |
111,151,000 | |||
Multiline Retail - 1.4% | |||
Dillard's, Inc. Class A | 350,000 | 21,455,000 | |
Specialty Retail - 5.3% | |||
Aarons, Inc. Class A | 1,690,000 | 41,759,900 | |
Finish Line, Inc. Class A | 900,000 | 17,721,000 | |
Genesco, Inc. (b) | 413,910 | 22,268,358 | |
81,749,258 | |||
TOTAL CONSUMER DISCRETIONARY | 214,355,258 | ||
CONSUMER STAPLES - 2.5% | |||
Food Products - 2.5% | |||
Post Holdings, Inc. (b) | 500,000 | 38,115,000 | |
ENERGY - 2.9% | |||
Energy Equipment & Services - 1.3% | |||
Hornbeck Offshore Services, Inc. (a)(b) | 728,322 | 2,891,438 | |
Oil States International, Inc. (b) | 570,900 | 16,698,825 | |
19,590,263 | |||
Oil, Gas & Consumable Fuels - 1.6% | |||
Northern Oil & Gas, Inc. (a)(b) | 2,345,073 | 4,924,653 | |
World Fuel Services Corp. | 500,000 | 20,125,000 | |
25,049,653 | |||
TOTAL ENERGY | 44,639,916 | ||
FINANCIALS - 25.3% | |||
Banks - 15.8% | |||
Associated Banc-Corp. | 1,497,500 | 30,399,250 | |
BOK Financial Corp. (a) | 500,000 | 35,510,000 | |
Cullen/Frost Bankers, Inc. | 725,000 | 55,092,750 | |
First Citizen Bancshares, Inc. | 166,738 | 48,520,758 | |
Hilltop Holdings, Inc. | 572,249 | 14,134,550 | |
PacWest Bancorp | 400,000 | 17,356,000 | |
TCF Financial Corp. | 3,000,000 | 42,900,000 | |
243,913,308 | |||
Capital Markets - 5.2% | |||
Federated Investors, Inc. Class B (non-vtg.) | 1,200,000 | 32,400,000 | |
Monex Group, Inc. | 8,021,900 | 18,434,995 | |
OM Asset Management Ltd. | 2,084,800 | 29,333,136 | |
80,168,131 | |||
Insurance - 2.2% | |||
Aspen Insurance Holdings Ltd. | 700,600 | 33,803,950 | |
Thrifts & Mortgage Finance - 2.1% | |||
Washington Federal, Inc. | 1,168,200 | 31,833,450 | |
TOTAL FINANCIALS | 389,718,839 | ||
HEALTH CARE - 11.9% | |||
Health Care Equipment & Supplies - 3.2% | |||
Hill-Rom Holdings, Inc. | 600,000 | 33,246,000 | |
Integra LifeSciences Holdings Corp. (b) | 200,000 | 15,902,000 | |
49,148,000 | |||
Health Care Providers & Services - 7.3% | |||
AmSurg Corp. (b) | 500,000 | 29,875,000 | |
Civitas Solutions, Inc. (b) | 1,750,000 | 29,925,000 | |
Team Health Holdings, Inc. (b) | 1,250,000 | 53,562,500 | |
113,362,500 | |||
Pharmaceuticals - 1.4% | |||
Innoviva, Inc. | 2,120,639 | 21,842,582 | |
TOTAL HEALTH CARE | 184,353,082 | ||
INDUSTRIALS - 16.5% | |||
Aerospace & Defense - 1.9% | |||
Engility Holdings, Inc. (b) | 1,000,000 | 28,730,000 | |
Commercial Services & Supplies - 1.5% | |||
Essendant, Inc. | 577,700 | 8,867,695 | |
Knoll, Inc. | 670,200 | 14,503,128 | |
23,370,823 | |||
Electrical Equipment - 3.5% | |||
EnerSys | 250,000 | 16,282,500 | |
Regal Beloit Corp. | 650,000 | 38,415,000 | |
54,697,500 | |||
Machinery - 2.5% | |||
Hillenbrand, Inc. | 480,000 | 14,568,000 | |
Mueller Industries, Inc. | 800,000 | 24,232,000 | |
38,800,000 | |||
Professional Services - 1.0% | |||
FTI Consulting, Inc. (b) | 375,000 | 14,610,000 | |
Road & Rail - 3.1% | |||
Genesee & Wyoming, Inc. Class A (b) | 221,712 | 15,063,113 | |
Swift Transporation Co. (a)(b) | 1,475,000 | 33,010,500 | |
48,073,613 | |||
Trading Companies & Distributors - 3.0% | |||
WESCO International, Inc. (b) | 852,430 | 46,201,706 | |
TOTAL INDUSTRIALS | 254,483,642 | ||
INFORMATION TECHNOLOGY - 15.3% | |||
Electronic Equipment & Components - 7.1% | |||
Ingram Micro, Inc. Class A | 1,100,000 | 40,920,000 | |
SYNNEX Corp. | 239,900 | 24,599,346 | |
Tech Data Corp. (b) | 575,000 | 44,286,500 | |
109,805,846 | |||
Internet Software & Services - 4.7% | |||
Cimpress NV (b) | 350,000 | 29,137,500 | |
j2 Global, Inc. | 600,000 | 42,690,000 | |
71,827,500 | |||
IT Services - 2.8% | |||
Booz Allen Hamilton Holding Corp. Class A | 450,000 | 13,711,500 | |
CACI International, Inc. Class A (b) | 300,000 | 29,355,000 | |
43,066,500 | |||
Software - 0.7% | |||
SS&C Technologies Holdings, Inc. | 350,000 | 11,175,500 | |
TOTAL INFORMATION TECHNOLOGY | 235,875,346 | ||
MATERIALS - 6.6% | |||
Containers & Packaging - 1.8% | |||
Silgan Holdings, Inc. | 550,000 | 28,022,500 | |
Metals & Mining - 4.8% | |||
Carpenter Technology Corp. | 912,092 | 28,831,228 | |
Compass Minerals International, Inc. (a) | 500,000 | 35,925,000 | |
Haynes International, Inc. | 300,000 | 9,651,000 | |
74,407,228 | |||
TOTAL MATERIALS | 102,429,728 | ||
REAL ESTATE - 1.6% | |||
Equity Real Estate Investment Trusts (REITs) - 1.6% | |||
Franklin Street Properties Corp. | 800,000 | 9,256,000 | |
Store Capital Corp. | 574,524 | 15,678,760 | |
24,934,760 | |||
UTILITIES - 1.4% | |||
Gas Utilities - 1.4% | |||
Southwest Gas Corp. | 289,100 | 20,948,186 | |
TOTAL COMMON STOCKS | |||
(Cost $1,371,974,419) | 1,509,853,757 | ||
Money Market Funds - 8.6% | |||
Fidelity Cash Central Fund, 0.41% (c) | 31,161,712 | 31,171,060 | |
Fidelity Securities Lending Cash Central Fund 0.48% (c)(d) | 101,334,871 | 101,355,138 | |
TOTAL MONEY MARKET FUNDS | |||
(Cost $132,501,980) | 132,526,198 | ||
TOTAL INVESTMENT PORTFOLIO - 106.5% | |||
(Cost $1,504,476,399) | 1,642,379,955 | ||
NET OTHER ASSETS (LIABILITIES) - (6.5)% | (100,272,917) | ||
NET ASSETS - 100% | $1,542,107,038 |
Legend
(a) Security or a portion of the security is on loan at period end.
(b) Non-income producing
(c) Affiliated fund that is generally 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. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
(d) Investment made with cash collateral received from securities on loan.
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 | $62,479 |
Fidelity Securities Lending Cash Central Fund | 466,128 |
Total | $528,607 |
Other Affiliated Issuers
An affiliated company is a company in which the Fund has ownership of at least 5% of the voting securities. Fiscal year to date transactions with companies which are or were affiliates are as follows:
Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
Monster Worldwide, Inc. | $17,600,000 | $-- | $18,732,091 | $-- | $-- |
Tidewater, Inc. | 20,761,200 | -- | 4,063,311 | -- | -- |
Total | $38,361,200 | $-- | $22,795,402 | $-- | $-- |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. 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 please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
The following is a summary of transfers between Level 1 and Level 2 for the period ended October 31, 2016. Transfers are assumed to have occurred at the beginning of the period, and are primarily attributable to the valuation techniques used for foreign equity securities, as discussed in the accompanying Notes to Financial Statements:
Transfers | Total |
Level 1 to Level 2 | $0 |
Level 2 to Level 1 | $20,798,203 |
See accompanying notes which are an integral part of the financial statements.
Financial Statements
Statement of Assets and Liabilities
October 31, 2016 (Unaudited) | ||
Assets | ||
Investment in securities, at value (including securities loaned of $99,397,685) — See accompanying schedule: Unaffiliated issuers (cost $1,371,974,419) | $1,509,853,757 | |
Fidelity Central Funds (cost $132,501,980) | 132,526,198 | |
Total Investments (cost $1,504,476,399) | $1,642,379,955 | |
Receivable for investments sold | 2,359,071 | |
Receivable for fund shares sold | 639,818 | |
Dividends receivable | 495,172 | |
Distributions receivable from Fidelity Central Funds | 59,710 | |
Prepaid expenses | 4,117 | |
Other receivables | 15,424 | |
Total assets | 1,645,953,267 | |
Liabilities | ||
Payable for investments purchased | $1,257,750 | |
Payable for fund shares redeemed | 256,919 | |
Accrued management fee | 838,403 | |
Other affiliated payables | 122,047 | |
Other payables and accrued expenses | 34,316 | |
Collateral on securities loaned, at value | 101,336,794 | |
Total liabilities | 103,846,229 | |
Net Assets | $1,542,107,038 | |
Net Assets consist of: | ||
Paid in capital | $1,522,965,809 | |
Undistributed net investment income | 3,065,381 | |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | (121,820,277) | |
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies | 137,896,125 | |
Net Assets | $1,542,107,038 | |
Series Small Cap Discovery: | ||
Net Asset Value, offering price and redemption price per share ($597,781,829 ÷ 58,994,474 shares) | $10.13 | |
Class F: | ||
Net Asset Value, offering price and redemption price per share ($944,325,209 ÷ 93,096,844 shares) | $10.14 |
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Six months ended October 31, 2016 (Unaudited) | ||
Investment Income | ||
Dividends | $8,883,117 | |
Income from Fidelity Central Funds | 528,607 | |
Total income | 9,411,724 | |
Expenses | ||
Management fee | ||
Basic fee | $5,453,656 | |
Performance adjustment | (171,889) | |
Transfer agent fees | 489,714 | |
Accounting and security lending fees | 256,746 | |
Custodian fees and expenses | 9,725 | |
Independent trustees' fees and expenses | 3,330 | |
Audit | 28,767 | |
Legal | 2,204 | |
Interest | 178 | |
Miscellaneous | 7,532 | |
Total expenses before reductions | 6,079,963 | |
Expense reductions | (86,151) | 5,993,812 |
Net investment income (loss) | 3,417,912 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | (29,588,070) | |
Fidelity Central Funds | 5,990 | |
Other affiliated issuers | (53,700,416) | |
Foreign currency transactions | 17,689 | |
Total net realized gain (loss) | (83,264,807) | |
Change in net unrealized appreciation (depreciation) on: Investment securities | 78,905,387 | |
Assets and liabilities in foreign currencies | (17,261) | |
Total change in net unrealized appreciation (depreciation) | 78,888,126 | |
Net gain (loss) | (4,376,681) | |
Net increase (decrease) in net assets resulting from operations | $(958,769) |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Six months ended October 31, 2016 (Unaudited) | Year ended April 30, 2016 | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $3,417,912 | $5,980,179 |
Net realized gain (loss) | (83,264,807) | (11,317,796) |
Change in net unrealized appreciation (depreciation) | 78,888,126 | (70,732,394) |
Net increase (decrease) in net assets resulting from operations | (958,769) | (76,070,011) |
Distributions to shareholders from net investment income | (2,435,841) | (4,499,268) |
Distributions to shareholders from net realized gain | – | (78,812,351) |
Total distributions | (2,435,841) | (83,311,619) |
Share transactions - net increase (decrease) | 871,466 | 76,957,414 |
Total increase (decrease) in net assets | (2,523,144) | (82,424,216) |
Net Assets | ||
Beginning of period | 1,544,630,182 | 1,627,054,398 |
End of period | $1,542,107,038 | $1,544,630,182 |
Other Information | ||
Undistributed net investment income end of period | $3,065,381 | $2,083,310 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Series Small Cap Discovery Fund
Six months ended (Unaudited) October 31, | Years ended April 30, | |||
2016 | 2016 | 2015 | 2014 A | |
Selected Per–Share Data | ||||
Net asset value, beginning of period | $10.16 | $11.23 | $10.16 | $10.00 |
Income from Investment Operations | ||||
Net investment income (loss)B | .02 | .03 | .02 | .02 |
Net realized and unrealized gain (loss) | (.04) | (.54) | 1.28 | .15 |
Total from investment operations | (.02) | (.51) | 1.30 | .17 |
Distributions from net investment income | (.01) | (.02) | (.02) | (.01) |
Distributions from net realized gain | – | (.54) | (.21) | – |
Total distributions | (.01) | (.56) | (.23) | (.01) |
Net asset value, end of period | $10.13 | $10.16 | $11.23 | $10.16 |
Total ReturnC,D | (.17)% | (4.82)% | 12.92% | 1.70% |
Ratios to Average Net AssetsE,F | ||||
Expenses before reductions | .88%G | .96% | .97% | .97%G |
Expenses net of fee waivers, if any | .87%G | .96% | .97% | .97%G |
Expenses net of all reductions | .86%G | .95% | .97% | .96%G |
Net investment income (loss) | .34%G | .29% | .17% | .35%G |
Supplemental Data | ||||
Net assets, end of period (000 omitted) | $597,782 | $614,362 | $659,747 | $572,515 |
Portfolio turnover rateH | 13%G | 35% | 28% | 29%I,J |
A For the period November 7, 2013 (commencement of operations) to April 30, 2014.
B Calculated based on average shares outstanding during the period.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Fees and expenses of any 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 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. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
G Annualized
H Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
I Portfolio turnover rate excludes securities received or delivered in-kind.
J Amount not annualized.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Series Small Cap Discovery Fund Class F
Six months ended (Unaudited) October 31, | Years ended April 30, | |||
2016 | 2016 | 2015 | 2014 A | |
Selected Per–Share Data | ||||
Net asset value, beginning of period | $10.16 | $11.24 | $10.16 | $10.00 |
Income from Investment Operations | ||||
Net investment income (loss)B | .03 | .05 | .04 | .03 |
Net realized and unrealized gain (loss) | (.03) | (.56) | 1.28 | .14 |
Total from investment operations | – | (.51) | 1.32 | .17 |
Distributions from net investment income | (.02) | (.04) | (.04) | (.01) |
Distributions from net realized gain | – | (.54) | (.21) | – |
Total distributions | (.02) | (.57)C | (.24)D | (.01) |
Net asset value, end of period | $10.14 | $10.16 | $11.24 | $10.16 |
Total ReturnE,F | (.02)% | (4.76)% | 13.19% | 1.73% |
Ratios to Average Net AssetsG,H | ||||
Expenses before reductions | .72%I | .80% | .80% | .79%I |
Expenses net of fee waivers, if any | .71%I | .80% | .80% | .79%I |
Expenses net of all reductions | .70%I | .79% | .80% | .79%I |
Net investment income (loss) | .50%I | .45% | .33% | .52%I |
Supplemental Data | ||||
Net assets, end of period (000 omitted) | $944,325 | $930,268 | $967,308 | $794,307 |
Portfolio turnover rateJ | 13%I | 35% | 28% | 29%K,L |
A For the period November 7, 2013 (commencement of operations) to April 30, 2014.
B Calculated based on average shares outstanding during the period.
C Total distributions of $.57 per share is comprised of distributions from net investment income of $.037 and distributions from net realized gain of $.536 per share.
D Total distributions of $.24 per share is comprised of distributions from net investment income of $.036 and distributions from net realized gain of $.206 per share.
E Total returns for periods of less than one year are not annualized.
F Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
G Fees and expenses of any 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.
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. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
I Annualized
J Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
K Portfolio turnover rate excludes securities received or delivered in-kind.
L Amount not annualized.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended October 31, 2016
1. Organization.
Fidelity Series Small Cap Discovery Fund (the Fund) is a fund of Fidelity Concord Street Trust (the Trust) (formerly a fund of Fidelity Commonwealth Trust) and is authorized to issue an unlimited number of shares. Shares of the Fund are only available for purchase by mutual funds for which Fidelity Management & Research Company (FMR) or an affiliate serves as an investment manager. 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 Series Small Cap Discovery and Class F shares, each of which has equal rights as to assets and voting privileges. Each class has exclusive voting rights with respect to matters that affect that class.
2. Investments in Fidelity Central Funds.
The Fund invests in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser 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 the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website 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. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Trustees (the Board) has delegated the day to day responsibility for the valuation of the Fund's investments to the Fair Value Committee (the Committee) established by the Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, the Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment specific events. The frequency with which these procedures are used cannot be predicted and they may be utilized to a significant extent. The Committee oversees the Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing the Fund's investments and ratifies the fair value determinations of the Committee.
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)
Valuation techniques used to value the Fund's investments by major category are as follows:
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing vendor 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 or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For foreign equity securities, when market or security specific events arise, comparisons to the valuation of American Depositary Receipts (ADRs), futures contracts, Exchange-Traded Funds (ETFs) and certain indexes as well as quoted prices for similar securities may be used and would be categorized as Level 2 in the hierarchy. Utilizing these techniques may result in transfers between Level 1 and Level 2. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
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 October 31, 2016, including information on transfers between Levels 1 and 2 is included at the end of the Fund's Schedule of Investments.
Foreign Currency. The Fund may use 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 rates 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. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Distributions received on securities that represent a return of capital or capital gain are recorded as a reduction of cost of investments and/or as a realized gain. Subsequent to ex-dividend date the Fund determines the components of these distributions, based upon receipt of tax filings or other correspondence relating to the underlying investment. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.
Class Allocations and Expenses. Investment income, realized and unrealized capital gains and losses, common expenses of the Fund, and certain fund-level expense reductions, if any, are allocated daily 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 fees incurred. Certain expense reductions may also differ by class. For the reporting period, the allocated portion of income and expenses to each class as a percent of its average net assets may vary due to the timing of recording these transactions in relation to fluctuating net assets of the classes. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. 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 under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. The Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction. Foreign taxes are provided for based on the Fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.
Distributions are declared and 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. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to foreign currency transactions, passive foreign investment companies (PFIC) and losses deferred due to wash sales and excise tax regulations.
The federal tax cost of investment securities and unrealized appreciation (depreciation) as of period end were as follows:
Gross unrealized appreciation | $256,495,942 |
Gross unrealized depreciation | (118,592,386) |
Net unrealized appreciation (depreciation) on securities | $137,903,556 |
Tax cost | $1,504,476,399 |
The Fund elected to defer to its next fiscal year approximately $38,269,847 of capital losses recognized during the period November 1, 2015 to April 30, 2016.
4. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities, aggregated $101,864,937 and $114,229,377, respectively.
5. Fees and Other Transactions with Affiliates.
Management Fee. Fidelity Management & Research Company (the investment adviser) 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 .45% of the Fund's average net assets and an annualized group fee rate that averaged .25% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by the investment adviser, including any mutual funds previously advised by the investment adviser that are currently advised by Fidelity SelectCo, LLC, an affiliate of the investment adviser. The group fee rate decreases as assets under management increase and increases as assets under management decrease. In addition, the management fee is subject to a performance adjustment (up to a maximum of +/- .20% of the Fund's average net assets over a 36 month performance period). The upward or downward adjustment to the management fee is based on the relative investment performance of Series Small Cap Discovery as compared to its benchmark index, the Russell 2000 Index, over the same 36 month performance period. For the reporting period, the total annualized management fee rate, including the performance adjustment, was .68% of the Fund's average net assets. The performance adjustment included in the management fee rate may be higher or lower than the maximum performance adjustment rate due to the difference between the average net assets for the reporting and performance periods.
Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc., (FIIOC), an affiliate of the investment adviser, 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 Series Small Cap Discovery. FIIOC receives no fees for providing transfer agency services to Class F. FIIOC pays for typesetting, printing and mailing of shareholder reports, except proxy statements.
For the period, transfer agent fees for each applicable class were as follows:
Amount | % of Class-Level Average Net Assets(a) | |
Series Small Cap Discovery | $489,714 | .16 |
(a) Annualized
Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of the investment adviser, maintains the Fund's accounting records. The accounting fee is based on the level of average net assets for each 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.
Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. Brokerage commissions are included in net realized gain (loss) and change in net unrealized appreciation (depreciation) in the Statement of Operations. The commissions paid to these affiliated firms were $6,702 for the period.
Interfund Lending Program. Pursuant to an Exemptive Order issued by the SEC, the Fund, along with other registered investment companies having management contracts with FMR or other affiliated entities of FMR, may participate in an interfund lending program. This program provides an alternative credit facility allowing the funds to borrow from, or lend money to, other participating affiliated funds. At period end, there were no interfund loans outstanding. The Fund's activity in this program during the period for which loans were outstanding was as follows:
Borrower or Lender | Average Loan Balance | Weighted Average Interest Rate | Interest Expense |
Borrower | $11,240,000 | .57% | $178 |
Interfund Trades. The Fund may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
6. Committed Line of Credit.
The Fund participates with other funds managed by the investment adviser or an affiliate in a $4.25 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 $2,589 and is reflected in Miscellaneous expenses on the Statement of Operations. During the period, the Fund did not borrow on this line of credit.
7. Security Lending.
The Fund lends portfolio securities through a lending agent from time to time in order to earn additional income. For equity securities, a lending agent is used and may loan securities to certain qualified borrowers, including Fidelity Capital Markets (FCM), a broker-dealer affiliated with the Fund. On the settlement date of the loan, the Fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the Fund and any additional required collateral is delivered to the Fund on the next business day. The Fund or borrower may terminate the loan at any time, and if the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, the Fund may apply collateral received from the borrower against the obligation. The Fund may experience delays and costs in recovering the securities loaned. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. Security lending income represents the income earned on investing cash collateral, less rebates paid to borrowers and any lending agent fees associated with the loan, plus any premium payments received for lending certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds. Total security lending income during the period amounted to $466,128. During the period, there were no securities loaned to FCM.
8. Expense Reductions.
Commissions paid to certain brokers with whom the investment adviser, or its affiliates, places trades on behalf of the Fund include an amount in addition to trade execution, which may be rebated back to the Fund to offset certain expenses. This amount totaled $80,638 for the period.
In addition, through arrangements with the Fund's custodian, credits realized as a result of certain uninvested cash balances were used to reduce the Fund's expenses. During the period, these credits reduced the Fund's custody expenses by $58.
In addition, during the period the investment adviser reimbursed and/or waived a portion of fund-level operating expenses in the amount of $5,455.
9. Distributions to Shareholders.
Distributions to shareholders of each class were as follows:
Six months ended October 31, 2016 | Year ended April 30, 2016 | |
From net investment income | ||
Series Small Cap Discovery | $776,160 | $1,196,911 |
Class F | 1,659,681 | 3,302,357 |
Total | $2,435,841 | $4,499,268 |
From net realized gain | ||
Series Small Cap Discovery | $– | $31,931,177 |
Class F | – | 46,881,174 |
Total | $– | $78,812,351 |
10. Share Transactions.
Transactions for each class of shares were as follows:
Shares | Shares | Dollars | Dollars | |
Six months ended October 31, 2016 | Year ended April 30, 2016 | Six months ended October 31, 2016 | Year ended April 30, 2016 | |
Series Small Cap Discovery | ||||
Shares sold | 1,440,441 | 6,809,741 | $14,812,510 | $70,648,062 |
Reinvestment of distributions | 76,020 | 3,063,716 | 776,160 | 33,128,088 |
Shares redeemed | (3,009,698) | (8,142,224) | (30,664,009) | (84,403,016) |
Net increase (decrease) | (1,493,237) | 1,731,233 | $(15,075,339) | $19,373,134 |
Class F | ||||
Shares sold | 5,843,988 | 15,260,748 | $59,874,021 | $155,435,426 |
Reinvestment of distributions | 162,554 | 4,647,653 | 1,659,681 | 50,183,531 |
Shares redeemed | (4,432,060) | (14,474,366) | (45,586,897) | (148,034,677) |
Net increase (decrease) | 1,574,482 | 5,434,035 | $15,946,805 | $57,584,280 |
11. 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.
At the end of the period, mutual funds managed by the investment adviser or its affiliates were the owners of record of all of the outstanding shares of the fund.
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including management fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (May 1, 2016 to October 31, 2016).
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.
Annualized Expense Ratio-A | Beginning Account Value May 1, 2016 | Ending Account Value October 31, 2016 | Expenses Paid During Period-B May 1, 2016 to October 31, 2016 | |
Series Small Cap Discovery | .87% | |||
Actual | $1,000.00 | $998.30 | $4.38 | |
Hypothetical-C | $1,000.00 | $1,020.82 | $4.43 | |
Class F | .71% | |||
Actual | $1,000.00 | $999.80 | $3.58 | |
Hypothetical-C | $1,000.00 | $1,021.63 | $3.62 |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).
C 5% return per year before expenses
Board Approval of Investment Advisory Contracts and Management Fees
Fidelity Series Small Cap Discovery Fund
Each year, the Board of Trustees, including the Independent Trustees (together, the Board), votes on the renewal of the management contract with Fidelity Management & Research Company (FMR) and the sub-advisory agreements (together, the Advisory Contracts) for the fund. The Board, assisted by the advice of fund counsel and Independent Trustees' counsel, requests and considers a broad range of information relevant to the renewal of the Advisory Contracts throughout the year.
The Board meets regularly and, at each of its meetings, covers an extensive agenda of topics and materials and considers factors that are relevant to its annual consideration of the renewal of the fund's Advisory Contracts, including the services and support provided to the fund and its shareholders. The Board has established various standing committees (Committees), each composed of and chaired by Independent Trustees with varying backgrounds, to which the Board has assigned specific subject matter responsibilities in order to enhance effective decision-making by the Board. The Board, acting directly and through its Committees, requests and receives information concerning the annual consideration of the renewal of the fund's Advisory Contracts. The Board also meets as needed to consider matters specifically related to the Board's annual consideration of the renewal of the Advisory Contracts. Members of the Board may also meet with trustees of other Fidelity funds through ad hoc joint committees to discuss certain matters relevant to all of the Fidelity funds.
At its July 2016 meeting, the Board unanimously determined to renew the fund's Advisory Contracts. In reaching its determination, the Board considered all factors it believed relevant, including (i) the nature, extent, and quality of the services to be provided to the fund and its shareholders (including the investment performance of the fund); (ii) the competitiveness of the fund's management fee and total expense ratio relative to peer funds; (iii) the total costs of the services to be provided by and the profits to be realized by Fidelity from its relationships with the fund; and (iv) the extent to which, if any, economies of scale exist and would be realized as the fund grows, and whether any economies of scale are appropriately shared with fund shareholders.
In considering whether to renew the Advisory Contracts for the fund, the Board reached a determination, with the assistance of fund counsel and Independent Trustees' counsel and through the exercise of its business judgment, that the renewal of the Advisory Contracts was in the best interests of the fund and its shareholders and that the compensation payable under the Advisory Contracts was fair and reasonable. The Board's decision to renew the Advisory Contracts was not based on any single factor, but rather was based on a comprehensive consideration of all the information provided to the Board at its meetings throughout the year. The Board, in reaching its determination to renew the Advisory Contracts, was aware that shareholders of the fund have a broad range of investment choices available to them, including a wide choice among funds offered by Fidelity's competitors, and that the fund's shareholders, who have the opportunity to review and weigh the disclosure provided by the fund in its prospectus and other public disclosures, have chosen to invest in this fund, which is part of the Fidelity family of funds.
Nature, Extent, and Quality of Services Provided. The Board considered Fidelity's staffing as it relates to the fund, including the backgrounds of investment personnel of Fidelity, and also considered the fund's investment objective, strategies, and related investment philosophy. The Independent Trustees also had discussions with senior management of Fidelity's investment operations and investment groups. The Board considered the structure of the investment personnel compensation program and whether this structure provides appropriate incentives to act in the best interests of the fund. Additionally, the Board considered the portfolio managers' investments, if any, in the funds that they manage.Resources Dedicated to Investment Management and Support Services. The Board and the Fund Oversight and Research Committees reviewed the general qualifications and capabilities of Fidelity's investment staff, including its size, education, experience, and resources, as well as Fidelity's approach to recruiting, training, managing, and compensating investment personnel. The Board noted that Fidelity has continued to increase the resources devoted to non-U.S. offices, including expansion of Fidelity's global investment organization. The Board also noted that Fidelity's analysts have extensive resources, tools and capabilities that allow them to conduct sophisticated quantitative and fundamental analysis, as well as credit analysis of issuers, counterparties and guarantors. Further, the Board considered that Fidelity's investment professionals have sufficient access to global information and data so as to provide competitive investment results over time, and that those professionals also have access to sophisticated tools that permit them to assess portfolio construction and risk and performance attribution characteristics continuously, as well as to transmit new information and research conclusions rapidly around the world. Additionally, in its deliberations, the Board considered Fidelity's trading, risk management, compliance, and technology and operations capabilities and resources, which are integral parts of the investment management process.Shareholder and Administrative Services. The Board considered (i) the nature, extent, quality, and cost of advisory, administrative, and shareholder services performed by FMR, the sub-advisers (together with FMR, the Investment Advisers), and their affiliates under the Advisory Contracts and under separate agreements covering transfer agency, pricing and bookkeeping, and securities lending services for the fund; (ii) the nature and extent of the supervision of third party service providers, principally custodians, subcustodians, and pricing vendors; and (iii) the resources devoted to, and the record of compliance with, the fund's compliance policies and procedures. The Board also reviewed the allocation of fund brokerage, including allocations to brokers affiliated with the Investment Advisers, the use of brokerage commissions to pay fund expenses, and the use of "soft" commission dollars to pay for research services.The Board noted that the growth of fund assets over time across the complex allows Fidelity to reinvest in the development of services designed to enhance the value or convenience of the Fidelity funds as investment vehicles. These services include 24-hour access to account information and market information through telephone representatives and over the Internet, investor education materials and asset allocation tools, and the expanded availability of Fidelity Investor Centers.In 2014, the Board formed an ad hoc Committee on Transfer Agency Fees to review the variety of transfer agency fee structures throughout the industry and Fidelity's competitive positioning with respect to industry participants.Investment in a Large Fund Family. The Board considered the benefits to shareholders of investing in a Fidelity fund, including the benefits of investing in a fund that is part of a large family of funds offering a variety of investment disciplines and providing a large variety of mutual fund investor services. The Board noted that Fidelity had taken, or had made recommendations that resulted in the Fidelity funds taking, a number of actions over the previous year that benefited particular funds, including: (i) continuing to dedicate additional resources to investment research and to the support of the senior management team that oversees asset management; (ii) continuing efforts to enhance Fidelity's global research capabilities; (iii) launching new funds and making other enhancements to meet client needs; (iv) broadening eligibility requirements for certain lower-priced share classes of, and streamlining the fee structure for, certain existing equity index funds; (v) lowering expense caps for certain existing funds and classes to reduce expenses paid by shareholders; (vi) eliminating redemption fees for certain variable insurance product funds and classes; (vii) continuing to launch dedicated lower cost underlying funds to meet portfolio construction needs related to expanding underlying fund options for Fidelity funds of funds, specifically for the Freedom Fund product lines; (viii) launching a lower cost share class for use by the Freedom Index Fund product line; (ix) rationalizing product lines and gaining increased efficiencies through fund mergers and share class consolidations; (x) continuing to develop, acquire and implement systems and technology to improve services to the funds and shareholders, strengthen information security, and increase efficiency; (xi) implementing investment enhancements to further strengthen Fidelity's target date product line to increase investors' probability of success in achieving their goals; (xii) accelerating the conversion of all remaining Class B shares to Class A shares, which have a lower expense structure; and (xiii) implementing changes to Fidelity's money market fund product line in response to recent regulatory reforms.Investment Performance. The Board considered whether the fund has operated in accordance with its investment objective, as well as its record of compliance with its investment restrictions and its performance history. The Board noted that there was a portfolio management change for the fund in February 2016.The Board took into account discussions with representatives of the Investment Advisers about fund investment performance that occur at Board meetings throughout the year. In this regard the Board noted that as part of regularly scheduled fund reviews and other reports to the Board on fund performance, the Board considers annualized return information for the fund, for different time periods, measured against a securities market index ("benchmark index") and a peer group of funds with similar objectives ("peer group"), if any. In its evaluation of fund investment performance, the Board gave particular attention to information indicating changes in performance of certain Fidelity funds for specific time periods and discussed with the Investment Advisers the reasons for any overperformance or underperformance.In addition to reviewing absolute and relative fund performance, the Independent Trustees periodically consider the appropriateness of fund performance metrics in evaluating the results achieved. In general, the Independent Trustees believe that fund performance should be evaluated based on net performance (after fees and expenses) of both the highest performing and lowest performing fund share classes, where applicable, compared to appropriate benchmark indices, over appropriate time periods that may include full market cycles, and compared to peer groups, as applicable, over the same periods, taking into account relevant factors including the following: general market conditions; issuer-specific information; and fund cash flows and other factors.The Independent Trustees recognize that shareholders evaluate performance on a net basis over their own holding periods, for which one-, three-, and five-year periods are often used as a proxy. For this reason, the performance information reviewed by the Board also included net cumulative calendar year total return information for the fund and an appropriate benchmark index and peer group for the most recent one-year period, as shown below. Returns are shown compared to the 25th percentile (top of box, 75% beaten) and 75th percentile (bottom of box, 25% beaten) of the peer universe.Fidelity Series Small Cap Discovery Fund
Fidelity Series Small Cap Discovery Fund
Corporate Headquarters
245 Summer St.
Boston, MA 02210
www.fidelity.com
XS4-SANN-1216
1.968032.102
Fidelity® Small Cap Discovery Fund Semi-Annual Report October 31, 2016 |
Contents
Board Approval of Investment Advisory Contracts and Management Fees |
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 1-800-544-8544 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third-party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. © 2016 FMR LLC. All rights reserved.
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, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Fund nor Fidelity Distributors Corporation is a bank.
Investment Summary (Unaudited)
Top Ten Stocks as of October 31, 2016
% of fund's net assets | % of fund's net assets 6 months ago | |
Cullen/Frost Bankers, Inc. | 3.7 | 3.0 |
Ingram Micro, Inc. Class A | 3.3 | 2.9 |
Team Health Holdings, Inc. | 3.2 | 2.4 |
Tech Data Corp. | 3.1 | 2.7 |
TCF Financial Corp. | 3.1 | 2.9 |
WESCO International, Inc. | 3.0 | 3.2 |
Post Holdings, Inc. | 3.0 | 3.0 |
j2 Global, Inc. | 2.8 | 2.4 |
Federated Investors, Inc. Class B (non-vtg.) | 2.6 | 3.0 |
Aarons, Inc. Class A | 2.6 | 2.7 |
30.4 |
Top Five Market Sectors as of October 31, 2016
% of fund's net assets | % of fund's net assets 6 months ago | |
Financials | 22.0 | 23.7 |
Information Technology | 19.2 | 17.3 |
Industrials | 16.0 | 16.2 |
Health Care | 14.4 | 14.0 |
Consumer Discretionary | 11.8 | 13.1 |
Prior period industry classifications reflect the categories in place as of the date indicated and have not been adjusted to reflect current industry classifications.
Asset Allocation (% of fund's net assets)
As of October 31, 2016 * | ||
Stocks | 99.1% | |
Short-Term Investments and Net Other Assets (Liabilities) | 0.9% |
* Foreign investments - 4.2%
As of April 30, 2016 * | ||
Stocks | 99.6% | |
Short-Term Investments and Net Other Assets (Liabilities) | 0.4% |
* Foreign investments - 4.2%
Investments October 31, 2016 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 99.1% | |||
Shares | Value | ||
CONSUMER DISCRETIONARY - 11.8% | |||
Household Durables - 2.5% | |||
KB Home (a) | 4,500,000 | $65,430,000 | |
Meritage Homes Corp. (b) | 1,956,880 | 60,565,436 | |
125,995,436 | |||
Leisure Products - 2.4% | |||
Brunswick Corp. | 2,800,000 | 121,800,000 | |
Multiline Retail - 1.4% | |||
Dillard's, Inc. Class A (a) | 1,200,000 | 73,560,000 | |
Specialty Retail - 5.5% | |||
Aarons, Inc. Class A (c) | 5,400,000 | 133,434,000 | |
Finish Line, Inc. Class A (c) | 3,225,000 | 63,500,250 | |
Genesco, Inc. (b)(c) | 1,628,600 | 87,618,680 | |
284,552,930 | |||
TOTAL CONSUMER DISCRETIONARY | 605,908,366 | ||
CONSUMER STAPLES - 3.0% | |||
Food Products - 3.0% | |||
Post Holdings, Inc. (b) | 2,000,000 | 152,460,000 | |
ENERGY - 4.3% | |||
Energy Equipment & Services - 4.3% | |||
Oil States International, Inc. (b) | 1,911,185 | 55,902,161 | |
ShawCor Ltd. Class A | 3,000,000 | 75,039,141 | |
Superior Energy Services, Inc. | 6,346,966 | 89,873,039 | |
220,814,341 | |||
FINANCIALS - 22.0% | |||
Banks - 15.8% | |||
Associated Banc-Corp. | 5,297,400 | 107,537,220 | |
Cathay General Bancorp | 2,450,000 | 73,377,500 | |
Cullen/Frost Bankers, Inc. (a) | 2,500,000 | 189,975,000 | |
First Citizen Bancshares, Inc. | 390,951 | 113,766,741 | |
First Citizen Bancshares, Inc. Class A (b) | 200,000 | 58,200,000 | |
Hilltop Holdings, Inc. | 1,985,968 | 49,053,410 | |
PacWest Bancorp | 1,350,000 | 58,576,500 | |
TCF Financial Corp. (c) | 11,007,139 | 157,402,088 | |
807,888,459 | |||
Capital Markets - 2.6% | |||
Federated Investors, Inc. Class B (non-vtg.) | 5,000,000 | 135,000,000 | |
Insurance - 1.1% | |||
Amerisafe, Inc. (c) | 1,000,000 | 55,600,000 | |
Thrifts & Mortgage Finance - 2.5% | |||
Washington Federal, Inc. (c) | 4,665,355 | 127,130,924 | |
TOTAL FINANCIALS | 1,125,619,383 | ||
HEALTH CARE - 14.4% | |||
Health Care Equipment & Supplies - 4.1% | |||
Hill-Rom Holdings, Inc. | 1,800,000 | 99,738,000 | |
Integra LifeSciences Holdings Corp. (b) | 1,400,000 | 111,314,000 | |
211,052,000 | |||
Health Care Providers & Services - 8.8% | |||
AmSurg Corp. (b) | 1,900,000 | 113,525,000 | |
Chemed Corp. | 350,000 | 49,497,000 | |
Owens & Minor, Inc. | 2,500,000 | 81,125,000 | |
Team Health Holdings, Inc. (b)(c) | 3,855,931 | 165,226,643 | |
VCA, Inc. (b) | 650,000 | 39,949,000 | |
449,322,643 | |||
Pharmaceuticals - 1.5% | |||
Innoviva, Inc. (a)(c) | 7,483,728 | 77,082,398 | |
TOTAL HEALTH CARE | 737,457,041 | ||
INDUSTRIALS - 16.0% | |||
Commercial Services & Supplies - 1.4% | |||
Essendant, Inc. | 1,489,900 | 22,869,965 | |
HNI Corp. | 1,250,000 | 50,825,000 | |
73,694,965 | |||
Electrical Equipment - 4.4% | |||
EnerSys | 1,200,000 | 78,156,000 | |
Powell Industries, Inc. (c) | 1,200,000 | 42,468,000 | |
Regal Beloit Corp. | 1,756,080 | 103,784,328 | |
224,408,328 | |||
Machinery - 1.7% | |||
Hillenbrand, Inc. | 1,650,000 | 50,077,500 | |
Mueller Industries, Inc. | 1,231,900 | 37,314,251 | |
87,391,751 | |||
Professional Services - 1.5% | |||
FTI Consulting, Inc. (b) | 2,000,000 | 77,920,000 | |
Road & Rail - 3.3% | |||
Genesee & Wyoming, Inc. Class A (b) | 771,888 | 52,442,071 | |
Swift Transporation Co. (a)(b) | 5,075,000 | 113,578,500 | |
166,020,571 | |||
Trading Companies & Distributors - 3.7% | |||
Diploma PLC | 3,000,000 | 34,425,000 | |
WESCO International, Inc. (b)(c) | 2,897,470 | 157,042,874 | |
191,467,874 | |||
TOTAL INDUSTRIALS | 820,903,489 | ||
INFORMATION TECHNOLOGY - 19.2% | |||
Electronic Equipment & Components - 8.4% | |||
Ingram Micro, Inc. Class A | 4,500,000 | 167,400,000 | |
SYNNEX Corp. | 1,012,681 | 103,840,310 | |
Tech Data Corp. (b)(c) | 2,100,000 | 161,742,000 | |
432,982,310 | |||
Internet Software & Services - 4.8% | |||
Cimpress NV (a)(b) | 1,250,000 | 104,062,500 | |
j2 Global, Inc. | 2,000,000 | 142,300,000 | |
246,362,500 | |||
IT Services - 4.6% | |||
Booz Allen Hamilton Holding Corp. Class A | 3,500,000 | 106,645,000 | |
CACI International, Inc. Class A (b)(c) | 1,300,000 | 127,205,000 | |
233,850,000 | |||
Software - 1.4% | |||
SS&C Technologies Holdings, Inc. | 2,200,000 | 70,246,000 | |
TOTAL INFORMATION TECHNOLOGY | 983,440,810 | ||
MATERIALS - 5.7% | |||
Containers & Packaging - 1.7% | |||
Silgan Holdings, Inc. | 1,725,000 | 87,888,750 | |
Metals & Mining - 4.0% | |||
Carpenter Technology Corp. (c) | 3,745,924 | 118,408,658 | |
Compass Minerals International, Inc. (a) | 700,000 | 50,295,000 | |
Haynes International, Inc. (c) | 1,100,000 | 35,387,000 | |
204,090,658 | |||
TOTAL MATERIALS | 291,979,408 | ||
REAL ESTATE - 1.7% | |||
Equity Real Estate Investment Trusts (REITs) - 1.7% | |||
Franklin Street Properties Corp. | 2,700,000 | 31,239,000 | |
Store Capital Corp. | 1,977,897 | 53,976,809 | |
85,215,809 | |||
UTILITIES - 1.0% | |||
Electric Utilities - 1.0% | |||
Portland General Electric Co. | 1,200,000 | 52,368,000 | |
TOTAL COMMON STOCKS | |||
(Cost $3,770,991,835) | 5,076,166,647 | ||
Money Market Funds - 3.8% | |||
Fidelity Cash Central Fund, 0.41% (d) | 40,587,025 | 40,599,201 | |
Fidelity Securities Lending Cash Central Fund 0.48% (d)(e) | 152,817,847 | 152,848,410 | |
TOTAL MONEY MARKET FUNDS | |||
(Cost $193,423,368) | 193,447,611 | ||
TOTAL INVESTMENT PORTFOLIO - 102.9% | |||
(Cost $3,964,415,203) | 5,269,614,258 | ||
NET OTHER ASSETS (LIABILITIES) - (2.9)% | (149,719,028) | ||
NET ASSETS - 100% | $5,119,895,230 |
Legend
(a) Security or a portion of the security is on loan at period end.
(b) Non-income producing
(c) Affiliated company
(d) Affiliated fund that is generally 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. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
(e) Investment made with cash collateral received from securities on loan.
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 | $91,203 |
Fidelity Securities Lending Cash Central Fund | 510,999 |
Total | $602,202 |
Other Affiliated Issuers
An affiliated company is a company in which the Fund has ownership of at least 5% of the voting securities. Fiscal year to date transactions with companies which are or were affiliates are as follows:
Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
Aarons, Inc. Class A | $141,534,000 | $-- | $-- | $270,000 | $133,434,000 |
Amerisafe, Inc. | 53,880,000 | -- | -- | 360,000 | 55,600,000 |
CACI International, Inc. Class A | 124,995,000 | -- | -- | -- | 127,205,000 |
Carpenter Technology Corp. | 132,643,169 | -- | -- | 1,348,532 | 118,408,658 |
EnerSys | 151,762,000 | -- | 86,041,799 | 665,000 | -- |
Finish Line, Inc. Class A | 63,693,750 | -- | -- | 645,000 | 63,500,250 |
FTI Consulting, Inc. | 120,900,000 | -- | 42,120,393 | -- | -- |
Genesco, Inc. | 117,419,214 | -- | 4,460,344 | -- | 87,618,680 |
Haynes International, Inc. | 41,283,000 | -- | -- | 484,000 | 35,387,000 |
Innoviva, Inc. | 94,548,192 | -- | 2,064,454 | -- | 77,082,398 |
Powell Industries, Inc. | 37,344,000 | -- | -- | 624,000 | 42,468,000 |
TCF Financial Corp. | 156,860,000 | -- | 7,068,951 | 1,725,000 | 157,402,088 |
Team Health Holdings, Inc. | 125,490,000 | 27,517,760 | -- | -- | 165,226,643 |
Tech Data Corp. | 144,249,000 | -- | -- | -- | 161,742,000 |
Tidewater, Inc. | 40,953,000 | -- | 8,015,147 | -- | -- |
Washington Federal, Inc. | 114,667,139 | -- | 1,403,486 | 657,336 | 127,130,924 |
WESCO International, Inc. | 170,342,263 | -- | -- | -- | 157,042,874 |
Total | $1,832,563,727 | $27,517,760 | $151,174,574 | $6,778,868 | $1,509,248,515 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. 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 please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Financial Statements
Statement of Assets and Liabilities
October 31, 2016 (Unaudited) | ||
Assets | ||
Investment in securities, at value (including securities loaned of $151,313,995) — See accompanying schedule: Unaffiliated issuers (cost $2,454,700,303) | $3,566,918,132 | |
Fidelity Central Funds (cost $193,423,368) | 193,447,611 | |
Other affiliated issuers (cost $1,316,291,532) | 1,509,248,515 | |
Total Investments (cost $3,964,415,203) | $5,269,614,258 | |
Receivable for investments sold | 10,445,666 | |
Receivable for fund shares sold | 3,237,270 | |
Dividends receivable | 1,187,267 | |
Distributions receivable from Fidelity Central Funds | 63,265 | |
Prepaid expenses | 14,080 | |
Other receivables | 41,793 | |
Total assets | 5,284,603,599 | |
Liabilities | ||
Payable for investments purchased | $4,180,800 | |
Payable for fund shares redeemed | 4,111,674 | |
Accrued management fee | 2,678,771 | |
Other affiliated payables | 867,247 | |
Other payables and accrued expenses | 44,502 | |
Collateral on securities loaned, at value | 152,825,375 | |
Total liabilities | 164,708,369 | |
Net Assets | $5,119,895,230 | |
Net Assets consist of: | ||
Paid in capital | $3,929,971,696 | |
Undistributed net investment income | 9,518,783 | |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | (124,794,304) | |
Net unrealized appreciation (depreciation) on investments | 1,305,199,055 | |
Net Assets, for 184,838,879 shares outstanding | $5,119,895,230 | |
Net Asset Value, offering price and redemption price per share ($5,119,895,230 ÷ 184,838,879 shares) | $27.70 |
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Six months ended October 31, 2016 (Unaudited) | ||
Investment Income | ||
Dividends (including $6,778,868 earned from other affiliated issuers) | $32,024,321 | |
Income from Fidelity Central Funds | 602,202 | |
Total income | 32,626,523 | |
Expenses | ||
Management fee | ||
Basic fee | $18,507,001 | |
Performance adjustment | (543,463) | |
Transfer agent fees | 4,706,454 | |
Accounting and security lending fees | 567,082 | |
Custodian fees and expenses | 28,469 | |
Independent trustees' fees and expenses | 11,337 | |
Registration fees | 42,076 | |
Audit | 29,255 | |
Legal | 8,014 | |
Miscellaneous | 27,294 | |
Total expenses before reductions | 23,383,519 | |
Expense reductions | (275,779) | 23,107,740 |
Net investment income (loss) | 9,518,783 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | (35,549,902) | |
Fidelity Central Funds | 18,580 | |
Other affiliated issuers | (85,953,488) | |
Foreign currency transactions | (17,696) | |
Total net realized gain (loss) | (121,502,506) | |
Change in net unrealized appreciation (depreciation) on investment securities | 93,909,192 | |
Net gain (loss) | (27,593,314) | |
Net increase (decrease) in net assets resulting from operations | $(18,074,531) |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Six months ended October 31, 2016 (Unaudited) | Year ended April 30, 2016 | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $9,518,783 | $29,333,142 |
Net realized gain (loss) | (121,502,506) | 84,595,961 |
Change in net unrealized appreciation (depreciation) | 93,909,192 | (307,146,825) |
Net increase (decrease) in net assets resulting from operations | (18,074,531) | (193,217,722) |
Distributions to shareholders from net investment income | – | (29,347,008) |
Distributions to shareholders from net realized gain | – | (357,140,838) |
Total distributions | – | (386,487,846) |
Share transactions | ||
Proceeds from sales of shares | 276,385,281 | 594,087,736 |
Reinvestment of distributions | – | 358,786,583 |
Cost of shares redeemed | (469,330,911) | (1,094,651,742) |
Net increase (decrease) in net assets resulting from share transactions | (192,945,630) | (141,777,423) |
Redemption fees | 99,820 | 219,477 |
Total increase (decrease) in net assets | (210,920,341) | (721,263,514) |
Net Assets | ||
Beginning of period | 5,330,815,571 | 6,052,079,085 |
End of period | $5,119,895,230 | $5,330,815,571 |
Other Information | ||
Undistributed net investment income end of period | $9,518,783 | $– |
Shares | ||
Sold | 9,779,870 | 21,550,144 |
Issued in reinvestment of distributions | – | 12,343,775 |
Redeemed | (16,617,499) | (39,847,068) |
Net increase (decrease) | (6,837,629) | (5,953,149) |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Small Cap Discovery Fund
Six months ended (Unaudited) October 31, | Years ended April 30, | |||||
2016 | 2016 | 2015 | 2014 | 2013 | 2012 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $27.81 | $30.62 | $30.77 | $27.46 | $22.37 | $22.78 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .05 | .15 | .11 | .05 | .25 | (.02) |
Net realized and unrealized gain (loss) | (.16) | (.99) | 3.00 | 5.10 | 5.55 | .11 |
Total from investment operations | (.11) | (.84) | 3.11 | 5.15 | 5.80 | .09 |
Distributions from net investment income | – | (.15) | (.08) | (.03) | (.22) | – |
Distributions from net realized gain | – | (1.82) | (3.18) | (1.81) | (.49) | (.51) |
Total distributions | – | (1.97) | (3.26) | (1.84) | (.72)B | (.51) |
Redemption fees added to paid in capitalA | –C | –C | –C | –C | .01 | .01 |
Net asset value, end of period | $27.70 | $27.81 | $30.62 | $30.77 | $27.46 | $22.37 |
Total ReturnD,E | (.40)% | (2.94)% | 10.62% | 19.26% | 26.69% | .72% |
Ratios to Average Net AssetsF,G | ||||||
Expenses before reductions | .88%H | 1.01% | 1.06% | 1.01% | 1.06% | 1.07% |
Expenses net of fee waivers, if any | .88%H | 1.01% | 1.06% | 1.01% | 1.06% | 1.07% |
Expenses net of all reductions | .87%H | 1.00% | 1.05% | 1.01% | 1.05% | 1.07% |
Net investment income (loss) | .36%H | .53% | .36% | .15% | 1.02% | (.12)% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $5,119,895 | $5,330,816 | $6,052,079 | $6,457,900 | $5,651,563 | $2,780,931 |
Portfolio turnover rateI | 7%H | 25% | 13% | 17% | 26% | 20% |
A Calculated based on average shares outstanding during the period.
B Total distributions of $.72 per share is comprised of distributions from net investment income of $.223 and distributions from net realized gain of $.493 per share.
C Amount represents less than $.005 per share.
D Total returns for periods of less than one year are not annualized.
E Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
F Fees and expenses of any 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 Expense ratios reflect operating expenses of the Fund. 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 Fund during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the Fund.
H Annualized
I Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended October 31, 2016
1. Organization.
Fidelity Small Cap Discovery Fund (the Fund) is a fund of Fidelity Concord Street Trust (the Trust) (formerly a fund of Fidelity Commonwealth Trust) and is authorized to issue an unlimited number of shares. Share transactions on the Statement of Changes in Net Assets may contain exchanges between affiliated funds. 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 is closed to new accounts with certain exceptions.
2. Investments in Fidelity Central Funds.
The Fund invests in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser 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 the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website 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. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Trustees (the Board) has delegated the day to day responsibility for the valuation of the Fund's investments to the Fair Value Committee (the Committee) established by the Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, the Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment specific events. The frequency with which these procedures are used cannot be predicted and they may be utilized to a significant extent. The Committee oversees the Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing the Fund's investments and ratifies the fair value determinations of the Committee.
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)
Valuation techniques used to value the Fund's investments by major category are as follows:
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing vendor 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 or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For foreign equity securities, when market or security specific events arise, comparisons to the valuation of American Depositary Receipts (ADRs), futures contracts, Exchange-Traded Funds (ETFs) and certain indexes as well as quoted prices for similar securities may be used and would be categorized as Level 2 in the hierarchy. Utilizing these techniques may result in transfers between Level 1 and Level 2. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy.
Foreign Currency. The Fund may use 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 rates 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 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. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Distributions received on securities that represent a return of capital or capital gain are recorded as a reduction of cost of investments and/or as a realized gain. Subsequent to ex-dividend date the Fund determines the components of these distributions, based upon receipt of tax filings or other correspondence relating to the underlying investment. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.
Expenses. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. 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 under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. The Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction. Foreign taxes are provided for based on the Fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.
Distributions are declared and recorded on the ex-dividend date. 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. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to foreign currency transactions, passive foreign investment companies (PFIC)and losses deferred due to wash sales and excise tax regulations.
The federal tax cost of investment securities and unrealized appreciation (depreciation) as of period end were as follows:
Gross unrealized appreciation | $1,524,354,392 |
Gross unrealized depreciation | (219,921,058) |
Net unrealized appreciation (depreciation) on securities | $1,304,433,334 |
Tax cost | $3,965,180,924 |
Short-Term Trading (Redemption) Fees. Shares held by investors in the Fund less than 90 days may have been subject to a redemption fee equal to 1.50% of the NAV of shares redeemed. All redemption fees, which reduce the proceeds of the shareholder redemption, are retained by the Fund and accounted for as an addition to paid in capital.
4. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities, aggregated $181,174,478 and $384,215,661, respectively.
5. Fees and Other Transactions with Affiliates.
Management Fee. Fidelity Management & Research Company (the investment adviser) 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 .45% of the Fund's average net assets and an annualized group fee rate that averaged .25% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by the investment adviser, including any mutual funds previously advised by the investment adviser that are currently advised by Fidelity SelectCo, LLC, an affiliate of the investment adviser. The group fee rate decreases as assets under management increase and increases as assets under management decrease. In addition, the management fee is subject to a performance adjustment(up to a maximum of +/- .20% of the Fund's average net assets over a 36 month performance period). The upward or downward adjustment to the management fee is based on the Fund's relative investment performance as compared to its benchmark index, the Russell 2000 Index, over the same 36 month performance period. For the reporting period, the total annualized management fee rate, including the performance adjustment, was .68% of the Fund's average net assets. The performance adjustment included in the management fee rate may be higher or lower than the maximum performance adjustment rate due to the difference between the average net assets for the reporting and performance periods.
Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc. (FIIOC), an affiliate of the investment adviser, is the Fund's transfer, dividend disbursing and shareholder servicing agent. FIIOC receives account fees and asset-based fees that vary according to account size and type of account. FIIOC pays for typesetting, printing and mailing of shareholder reports, except proxy statements. For the period, the transfer agent fees were equivalent to an annualized rate of .18% of average net assets.
Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of the investment adviser, maintains the Fund's accounting records. The accounting fee is based on the level of average net assets for each 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.
Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. Brokerage commissions are included in net realized gain (loss) and change in net unrealized appreciation (depreciation) in the Statement of Operations. The commissions paid to these affiliated firms were $22,358 for the period.
Interfund Trades. The Fund may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
6. Committed Line of Credit.
The Fund participates with other funds managed by the investment adviser or an affiliate in a $4.25 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 $8,810 and is reflected in Miscellaneous expenses on the Statement of Operations. During the period, the Fund did not borrow on this line of credit.
7. Security Lending.
The Fund lends portfolio securities through a lending agent from time to time in order to earn additional income. For equity securities, a lending agent is used and may loan securities to certain qualified borrowers, including Fidelity Capital Markets (FCM), a broker-dealer affiliated with the Fund. On the settlement date of the loan, the Fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the Fund and any additional required collateral is delivered to the Fund on the next business day. The Fund or borrower may terminate the loan at any time, and if the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, the Fund may apply collateral received from the borrower against the obligation. The Fund may experience delays and costs in recovering the securities loaned. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. The value of securities loaned to FCM at period end was $2,652,250. Security lending income represents the income earned on investing cash collateral, less rebates paid to borrowers and any lending agent fees associated with the loan, plus any premium payments received for lending certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds and includes $15,429 from securities loaned to FCM.
8. Expense Reductions.
Commissions paid to certain brokers with whom the investment adviser, or its affiliates, places trades on behalf of the Fund include an amount in addition to trade execution, which may be rebated back to the Fund to offset certain expenses. This amount totaled $256,603 for the period. In addition, through arrangements with the Fund's custodian, credits realized as a result of certain uninvested cash balances were used to reduce the Fund's expenses. During the period, these credits reduced the Fund's custody expenses by $40.
In addition, during the period the investment adviser reimbursed and/or waived a portion of operating expenses in the amount of $19,136.
9. Other.
The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund's maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including redemption fees and (2) ongoing costs, including management fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (May 1, 2016 to October 31, 2016).
Actual Expenses
The first line of the accompanying table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. 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 provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. 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.
Annualized Expense Ratio-A | Beginning Account Value May 1, 2016 | Ending Account Value October 31, 2016 | Expenses Paid During Period-B May 1, 2016 to October 31, 2016 | |
Actual | .88% | $1,000.00 | $996.00 | $4.43 |
Hypothetical-C | $1,000.00 | $1,020.77 | $4.48 |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to the Fund's annualized expense ratio, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).
C 5% return per year before expenses
Board Approval of Investment Advisory Contracts and Management Fees
Fidelity Small Cap Discovery Fund
Each year, the Board of Trustees, including the Independent Trustees (together, the Board), votes on the renewal of the management contract with Fidelity Management & Research Company (FMR) and the sub-advisory agreements (together, the Advisory Contracts) for the fund. The Board, assisted by the advice of fund counsel and Independent Trustees' counsel, requests and considers a broad range of information relevant to the renewal of the Advisory Contracts throughout the year.
The Board meets regularly and, at each of its meetings, covers an extensive agenda of topics and materials and considers factors that are relevant to its annual consideration of the renewal of the fund's Advisory Contracts, including the services and support provided to the fund and its shareholders. The Board has established various standing committees (Committees), each composed of and chaired by Independent Trustees with varying backgrounds, to which the Board has assigned specific subject matter responsibilities in order to enhance effective decision-making by the Board. The Board, acting directly and through its Committees, requests and receives information concerning the annual consideration of the renewal of the fund's Advisory Contracts. The Board also meets as needed to consider matters specifically related to the Board's annual consideration of the renewal of the Advisory Contracts. Members of the Board may also meet with trustees of other Fidelity funds through ad hoc joint committees to discuss certain matters relevant to all of the Fidelity funds.
At its July 2016 meeting, the Board unanimously determined to renew the fund's Advisory Contracts. In reaching its determination, the Board considered all factors it believed relevant, including (i) the nature, extent, and quality of the services to be provided to the fund and its shareholders (including the investment performance of the fund); (ii) the competitiveness of the fund's management fee and total expense ratio relative to peer funds; (iii) the total costs of the services to be provided by and the profits to be realized by Fidelity from its relationships with the fund; and (iv) the extent to which, if any, economies of scale exist and would be realized as the fund grows, and whether any economies of scale are appropriately shared with fund shareholders.
In considering whether to renew the Advisory Contracts for the fund, the Board reached a determination, with the assistance of fund counsel and Independent Trustees' counsel and through the exercise of its business judgment, that the renewal of the Advisory Contracts was in the best interests of the fund and its shareholders and that the compensation payable under the Advisory Contracts was fair and reasonable. The Board's decision to renew the Advisory Contracts was not based on any single factor, but rather was based on a comprehensive consideration of all the information provided to the Board at its meetings throughout the year. The Board, in reaching its determination to renew the Advisory Contracts, was aware that shareholders of the fund have a broad range of investment choices available to them, including a wide choice among funds offered by Fidelity's competitors, and that the fund's shareholders, who have the opportunity to review and weigh the disclosure provided by the fund in its prospectus and other public disclosures, have chosen to invest in this fund, which is part of the Fidelity family of funds.
Nature, Extent, and Quality of Services Provided. The Board considered Fidelity's staffing as it relates to the fund, including the backgrounds of investment personnel of Fidelity, and also considered the fund's investment objective, strategies, and related investment philosophy. The Independent Trustees also had discussions with senior management of Fidelity's investment operations and investment groups. The Board considered the structure of the investment personnel compensation program and whether this structure provides appropriate incentives to act in the best interests of the fund. Additionally, the Board considered the portfolio managers' investments, if any, in the funds that they manage.Resources Dedicated to Investment Management and Support Services. The Board and the Fund Oversight and Research Committees reviewed the general qualifications and capabilities of Fidelity's investment staff, including its size, education, experience, and resources, as well as Fidelity's approach to recruiting, training, managing, and compensating investment personnel. The Board noted that Fidelity has continued to increase the resources devoted to non-U.S. offices, including expansion of Fidelity's global investment organization. The Board also noted that Fidelity's analysts have extensive resources, tools and capabilities that allow them to conduct sophisticated quantitative and fundamental analysis, as well as credit analysis of issuers, counterparties and guarantors. Further, the Board considered that Fidelity's investment professionals have sufficient access to global information and data so as to provide competitive investment results over time, and that those professionals also have access to sophisticated tools that permit them to assess portfolio construction and risk and performance attribution characteristics continuously, as well as to transmit new information and research conclusions rapidly around the world. Additionally, in its deliberations, the Board considered Fidelity's trading, risk management, compliance, and technology and operations capabilities and resources, which are integral parts of the investment management process.Shareholder and Administrative Services. The Board considered (i) the nature, extent, quality, and cost of advisory, administrative, and shareholder services performed by FMR, the sub-advisers (together with FMR, the Investment Advisers), and their affiliates under the Advisory Contracts and under separate agreements covering transfer agency, pricing and bookkeeping, and securities lending services for the fund; (ii) the nature and extent of the supervision of third party service providers, principally custodians, subcustodians, and pricing vendors; and (iii) the resources devoted to, and the record of compliance with, the fund's compliance policies and procedures. The Board also reviewed the allocation of fund brokerage, including allocations to brokers affiliated with the Investment Advisers, the use of brokerage commissions to pay fund expenses, and the use of "soft" commission dollars to pay for research services.The Board noted that the growth of fund assets over time across the complex allows Fidelity to reinvest in the development of services designed to enhance the value or convenience of the Fidelity funds as investment vehicles. These services include 24-hour access to account information and market information through telephone representatives and over the Internet, investor education materials and asset allocation tools, and the expanded availability of Fidelity Investor Centers.In 2014, the Board formed an ad hoc Committee on Transfer Agency Fees to review the variety of transfer agency fee structures throughout the industry and Fidelity's competitive positioning with respect to industry participants.Investment in a Large Fund Family. The Board considered the benefits to shareholders of investing in a Fidelity fund, including the benefits of investing in a fund that is part of a large family of funds offering a variety of investment disciplines and providing a large variety of mutual fund investor services. The Board noted that Fidelity had taken, or had made recommendations that resulted in the Fidelity funds taking, a number of actions over the previous year that benefited particular funds, including: (i) continuing to dedicate additional resources to investment research and to the support of the senior management team that oversees asset management; (ii) continuing efforts to enhance Fidelity's global research capabilities; (iii) launching new funds and making other enhancements to meet client needs; (iv) broadening eligibility requirements for certain lower-priced share classes of, and streamlining the fee structure for, certain existing equity index funds; (v) lowering expense caps for certain existing funds and classes to reduce expenses paid by shareholders; (vi) eliminating redemption fees for certain variable insurance product funds and classes; (vii) continuing to launch dedicated lower cost underlying funds to meet portfolio construction needs related to expanding underlying fund options for Fidelity funds of funds, specifically for the Freedom Fund product lines; (viii) launching a lower cost share class for use by the Freedom Index Fund product line; (ix) rationalizing product lines and gaining increased efficiencies through fund mergers and share class consolidations; (x) continuing to develop, acquire and implement systems and technology to improve services to the funds and shareholders, strengthen information security, and increase efficiency; (xi) implementing investment enhancements to further strengthen Fidelity's target date product line to increase investors' probability of success in achieving their goals; (xii) accelerating the conversion of all remaining Class B shares to Class A shares, which have a lower expense structure; and (xiii) implementing changes to Fidelity's money market fund product line in response to recent regulatory reforms.Investment Performance. The Board considered whether the fund has operated in accordance with its investment objective, as well as its record of compliance with its investment restrictions and its performance history. The Board noted that there was a portfolio management change for the fund in February 2016.The Board took into account discussions with representatives of the Investment Advisers about fund investment performance that occur at Board meetings throughout the year. In this regard the Board noted that as part of regularly scheduled fund reviews and other reports to the Board on fund performance, the Board considers annualized return information for the fund, for different time periods, measured against a securities market index ("benchmark index") and a peer group of funds with similar objectives ("peer group"), if any. In its evaluation of fund investment performance, the Board gave particular attention to information indicating changes in performance of certain Fidelity funds for specific time periods and discussed with the Investment Advisers the reasons for any overperformance or underperformance.In addition to reviewing absolute and relative fund performance, the Independent Trustees periodically consider the appropriateness of fund performance metrics in evaluating the results achieved. In general, the Independent Trustees believe that fund performance should be evaluated based on net performance (after fees and expenses) of both the highest performing and lowest performing fund share classes, where applicable, compared to appropriate benchmark indices, over appropriate time periods that may include full market cycles, and compared to peer groups, as applicable, over the same periods, taking into account relevant factors including the following: general market conditions; issuer-specific information; and fund cash flows and other factors.The Independent Trustees recognize that shareholders evaluate performance on a net basis over their own holding periods, for which one-, three-, and five-year periods are often used as a proxy. For this reason, the performance information reviewed by the Board also included net cumulative calendar year total return information for the fund and an appropriate benchmark index and peer group for the most recent one-, three-, and five-year periods, as shown below. Returns are shown compared to the 25th percentile (top of box, 75% beaten) and 75th percentile (bottom of box, 25% beaten) of the peer universe.Fidelity Small Cap Discovery Fund
Fidelity Small Cap Discovery Fund
Corporate Headquarters
245 Summer St.
Boston, MA 02210
www.fidelity.com
SMR-SANN-1216
1.749363.116
Fidelity® Small Cap Stock Fund Semi-Annual Report October 31, 2016 |
Contents
Board Approval of Investment Advisory Contracts and Management Fees |
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 1-800-544-8544 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third-party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. © 2016 FMR LLC. All rights reserved.
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, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Fund nor Fidelity Distributors Corporation is a bank.
Investment Summary (Unaudited)
Top Ten Stocks as of October 31, 2016
% of fund's net assets | % of fund's net assets 6 months ago | |
Investors Bancorp, Inc. | 2.2 | 1.8 |
HD Supply Holdings, Inc. | 2.1 | 1.8 |
Genpact Ltd. | 2.0 | 1.9 |
Community Bank System, Inc. | 1.9 | 1.6 |
Landstar System, Inc. | 1.9 | 1.9 |
Coresite Realty Corp. | 1.9 | 1.4 |
Synchronoss Technologies, Inc. | 1.8 | 1.3 |
Starz Series A | 1.8 | 0.5 |
World Fuel Services Corp. | 1.7 | 1.9 |
LivaNova PLC | 1.7 | 1.7 |
19.0 |
Top Five Market Sectors as of October 31, 2016
% of fund's net assets | % of fund's net assets 6 months ago | |
Financials | 18.8 | 25.7 |
Information Technology | 18.2 | 17.8 |
Industrials | 17.3 | 13.7 |
Health Care | 14.7 | 13.6 |
Consumer Discretionary | 11.7 | 14.1 |
Prior period industry classifications reflect the categories in place as of the date indicated and have not been adjusted to reflect current industry classifications.
Asset Allocation (% of fund's net assets)
As of October 31, 2016* | ||
Stocks | 98.7% | |
Short-Term Investments and Net Other Assets (Liabilities) | 1.3% |
* Foreign investments - 17.2%
As of April 30, 2016* | ||
Stocks | 97.3% | |
Short-Term Investments and Net Other Assets (Liabilities) | 2.7% |
* Foreign investments - 19.1%
Investments October 31, 2016 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 98.7% | |||
Shares | Value (000s) | ||
CONSUMER DISCRETIONARY - 11.7% | |||
Diversified Consumer Services - 0.8% | |||
ServiceMaster Global Holdings, Inc. (a) | 396,057 | $14,175 | |
Hotels, Restaurants & Leisure - 1.7% | |||
Buffalo Wild Wings, Inc. (a) | 126,000 | 18,352 | |
Del Frisco's Restaurant Group, Inc. (a) | 748,824 | 10,708 | |
29,060 | |||
Household Durables - 1.9% | |||
KB Home (b) | 1,728,000 | 25,125 | |
New Home Co. LLC (a)(b) | 732,354 | 7,338 | |
32,463 | |||
Internet & Direct Marketing Retail - 0.7% | |||
HSN, Inc. | 316,330 | 11,926 | |
Leisure Products - 1.2% | |||
Vista Outdoor, Inc. (a) | 558,647 | 21,603 | |
Media - 2.4% | |||
AMC Networks, Inc. Class A (a) | 219,491 | 10,740 | |
Starz Series A (a) | 995,585 | 31,321 | |
42,061 | |||
Specialty Retail - 2.0% | |||
Murphy U.S.A., Inc. (a) | 385,810 | 26,536 | |
Select Comfort Corp. (a) | 379,000 | 7,273 | |
33,809 | |||
Textiles, Apparel & Luxury Goods - 1.0% | |||
G-III Apparel Group Ltd. (a) | 375,749 | 9,815 | |
Steven Madden Ltd. (a) | 242,132 | 8,087 | |
17,902 | |||
TOTAL CONSUMER DISCRETIONARY | 202,999 | ||
CONSUMER STAPLES - 3.1% | |||
Beverages - 1.4% | |||
Coca-Cola Bottling Co. Consolidated | 175,242 | 24,762 | |
Food & Staples Retailing - 0.9% | |||
United Natural Foods, Inc. (a) | 352,000 | 14,692 | |
Food Products - 0.8% | |||
TreeHouse Foods, Inc. (a) | 167,400 | 14,644 | |
TOTAL CONSUMER STAPLES | 54,098 | ||
ENERGY - 3.4% | |||
Energy Equipment & Services - 0.5% | |||
Dril-Quip, Inc. (a) | 185,577 | 8,815 | |
Oil, Gas & Consumable Fuels - 2.9% | |||
Ardmore Shipping Corp. | 1,317,159 | 7,705 | |
Parsley Energy, Inc. Class A (a) | 385,000 | 12,667 | |
World Fuel Services Corp. | 748,900 | 30,143 | |
50,515 | |||
TOTAL ENERGY | 59,330 | ||
FINANCIALS - 18.8% | |||
Banks - 9.6% | |||
Camden National Corp. | 409,089 | 13,508 | |
Community Bank System, Inc. | 718,890 | 33,867 | |
East West Bancorp, Inc. | 264,803 | 10,462 | |
Investors Bancorp, Inc. | 3,140,000 | 38,495 | |
Popular, Inc. | 241,000 | 8,748 | |
Prosperity Bancshares, Inc. | 443,878 | 24,622 | |
UMB Financial Corp. | 389,409 | 24,163 | |
United Community Bank, Inc. | 618,200 | 13,335 | |
167,200 | |||
Capital Markets - 4.4% | |||
Greenhill & Co., Inc. | 415,000 | 9,732 | |
Monex Group, Inc. | 3,711,300 | 8,529 | |
MSCI, Inc. | 115,000 | 9,222 | |
OM Asset Management Ltd. | 1,621,705 | 22,817 | |
Vontobel Holdings AG | 511,308 | 25,034 | |
75,334 | |||
Insurance - 4.8% | |||
Allied World Assurance Co. Holdings AG | 668,000 | 28,711 | |
AmTrust Financial Services, Inc. | 665,200 | 17,555 | |
Employers Holdings, Inc. | 825,500 | 25,879 | |
Primerica, Inc. (b) | 214,408 | 11,728 | |
83,873 | |||
TOTAL FINANCIALS | 326,407 | ||
HEALTH CARE - 14.7% | |||
Biotechnology - 3.0% | |||
Adverum Biotechnologies, Inc. (a) | 305,723 | 902 | |
Applied Genetic Technologies Corp. (a) | 183,700 | 1,313 | |
ArQule, Inc. (a) | 731,880 | 981 | |
Aviragen Therapeutics, Inc. (a) | 393,550 | 496 | |
Concert Pharmaceuticals, Inc. (a) | 100,000 | 772 | |
CTI BioPharma Corp. (a) | 4,563,602 | 1,751 | |
Dyax Corp. rights 12/31/19 | 632,800 | 1,557 | |
Emergent BioSolutions, Inc. (a) | 25,000 | 668 | |
Enanta Pharmaceuticals, Inc. (a) | 50,000 | 1,176 | |
FibroGen, Inc. (a) | 10,000 | 166 | |
Five Prime Therapeutics, Inc. (a) | 75,400 | 3,659 | |
Geron Corp. (a) | 160,000 | 296 | |
Immune Design Corp. (a) | 82,172 | 440 | |
Infinity Pharmaceuticals, Inc. (a) | 1,145,000 | 1,385 | |
Macrogenics, Inc. (a) | 21,800 | 516 | |
Myriad Genetics, Inc. (a)(b) | 87,000 | 1,715 | |
Otonomy, Inc. (a) | 292,000 | 4,409 | |
PDL BioPharma, Inc. | 715,000 | 2,302 | |
Samsung Biologics Co. Ltd. (a) | 1,381 | 164 | |
Spark Therapeutics, Inc. (a) | 97,017 | 4,561 | |
United Therapeutics Corp. (a) | 172,930 | 20,764 | |
Verastem, Inc. (a) | 681,255 | 852 | |
Vical, Inc. (a) | 395,000 | 1,019 | |
51,864 | |||
Health Care Equipment & Supplies - 2.7% | |||
Hill-Rom Holdings, Inc. | 220,592 | 12,223 | |
LivaNova PLC (a) | 528,900 | 29,978 | |
NxStage Medical, Inc. (a) | 227,950 | 5,184 | |
47,385 | |||
Health Care Providers & Services - 4.5% | |||
Air Methods Corp. (a)(b) | 183,639 | 4,857 | |
AmSurg Corp. (a) | 292,000 | 17,447 | |
HealthSouth Corp. | 401,092 | 16,104 | |
Providence Service Corp. (a) | 203,418 | 8,231 | |
Ship Healthcare Holdings, Inc. | 615,300 | 18,042 | |
Team Health Holdings, Inc. (a) | 286,080 | 12,259 | |
76,940 | |||
Life Sciences Tools & Services - 1.2% | |||
PAREXEL International Corp. (a) | 361,488 | 21,060 | |
Pharmaceuticals - 3.3% | |||
Achaogen, Inc. (a)(b) | 250,000 | 1,148 | |
Alliance Pharma PLC | 16,907,226 | 9,364 | |
Amphastar Pharmaceuticals, Inc. (a) | 459,171 | 8,329 | |
Dechra Pharmaceuticals PLC | 1,480,902 | 24,380 | |
Endocyte, Inc. (a)(b) | 254,425 | 700 | |
Innoviva, Inc. (b) | 412,057 | 4,244 | |
The Medicines Company (a) | 141,100 | 4,649 | |
Theravance Biopharma, Inc. (a) | 190,000 | 4,775 | |
57,589 | |||
TOTAL HEALTH CARE | 254,838 | ||
INDUSTRIALS - 17.3% | |||
Aerospace & Defense - 1.8% | |||
Astronics Corp. (a) | 127,205 | 4,709 | |
Astronics Corp. Class B | 6,263 | 232 | |
Moog, Inc. Class A (a) | 294,602 | 17,108 | |
Teledyne Technologies, Inc. (a) | 81,418 | 8,767 | |
30,816 | |||
Building Products - 1.1% | |||
Gibraltar Industries, Inc. (a) | 492,111 | 19,143 | |
Construction & Engineering - 2.5% | |||
AECOM (a) | 885,063 | 24,649 | |
Dycom Industries, Inc. (a) | 239,000 | 18,386 | |
43,035 | |||
Machinery - 3.4% | |||
Alamo Group, Inc. | 142,653 | 9,261 | |
Allison Transmission Holdings, Inc. | 939,600 | 27,521 | |
Rexnord Corp. (a) | 1,150,347 | 22,880 | |
59,662 | |||
Professional Services - 3.8% | |||
Advisory Board Co. (a) | 506,980 | 20,178 | |
CEB, Inc. | 5,462 | 266 | |
Resources Connection, Inc. | 1,463,704 | 21,736 | |
TriNet Group, Inc. (a) | 571,601 | 10,729 | |
WageWorks, Inc. (a) | 227,535 | 13,413 | |
66,322 | |||
Road & Rail - 1.9% | |||
Landstar System, Inc. | 470,200 | 33,455 | |
Trading Companies & Distributors - 2.8% | |||
HD Supply Holdings, Inc. (a) | 1,105,681 | 36,487 | |
Watsco, Inc. | 82,800 | 11,368 | |
47,855 | |||
TOTAL INDUSTRIALS | 300,288 | ||
INFORMATION TECHNOLOGY - 18.2% | |||
Communications Equipment - 2.6% | |||
Brocade Communications Systems, Inc. | 982,800 | 10,418 | |
CommScope Holding Co., Inc. (a) | 530,000 | 16,192 | |
NETGEAR, Inc. (a) | 365,112 | 18,438 | |
45,048 | |||
Electronic Equipment & Components - 1.6% | |||
Cardtronics PLC | 149,694 | 7,485 | |
IPG Photonics Corp. (a) | 95,180 | 9,233 | |
Trimble, Inc. (a) | 436,691 | 12,070 | |
28,788 | |||
Internet Software & Services - 3.4% | |||
Bankrate, Inc. (a) | 2,200,674 | 17,165 | |
j2 Global, Inc. | 406,000 | 28,887 | |
Stamps.com, Inc. (a) | 133,300 | 13,003 | |
59,055 | |||
IT Services - 6.0% | |||
Genpact Ltd. (a) | 1,522,050 | 34,992 | |
Maximus, Inc. | 400,000 | 20,824 | |
Paysafe Group PLC (a) | 4,118,513 | 21,828 | |
Perficient, Inc. (a) | 860,615 | 16,016 | |
Virtusa Corp. (a) | 525,200 | 9,947 | |
103,607 | |||
Semiconductors & Semiconductor Equipment - 1.8% | |||
Cree, Inc. (a) | 395,000 | 8,809 | |
ON Semiconductor Corp. (a) | 1,870,000 | 21,823 | |
30,632 | |||
Software - 2.8% | |||
Micro Focus International PLC | 668,000 | 17,506 | |
Synchronoss Technologies, Inc. (a) | 872,000 | 32,011 | |
49,517 | |||
TOTAL INFORMATION TECHNOLOGY | 316,647 | ||
MATERIALS - 3.1% | |||
Containers & Packaging - 1.9% | |||
Graphic Packaging Holding Co. | 752,324 | 9,404 | |
Silgan Holdings, Inc. | 449,980 | 22,926 | |
32,330 | |||
Paper & Forest Products - 1.2% | |||
Schweitzer-Mauduit International, Inc. | 575,686 | 21,249 | |
TOTAL MATERIALS | 53,579 | ||
REAL ESTATE - 6.9% | |||
Equity Real Estate Investment Trusts (REITs) - 5.3% | |||
Ashford Hospitality Prime, Inc. | 50,000 | 648 | |
Coresite Realty Corp. | 451,037 | 33,259 | |
CubeSmart | 1,101,900 | 28,727 | |
Piedmont Office Realty Trust, Inc. Class A | 382,100 | 7,825 | |
WP Carey, Inc. | 352,000 | 21,380 | |
91,839 | |||
Real Estate Management & Development - 1.6% | |||
Leopalace21 Corp. | 4,168,300 | 27,187 | |
TOTAL REAL ESTATE | 119,026 | ||
UTILITIES - 1.5% | |||
Electric Utilities - 1.2% | |||
IDACORP, Inc. | 263,648 | 20,667 | |
Independent Power and Renewable Electricity Producers - 0.3% | |||
Pattern Energy Group, Inc. | 229,500 | 5,129 | |
TOTAL UTILITIES | 25,796 | ||
TOTAL COMMON STOCKS | |||
(Cost $1,541,595) | 1,713,008 | ||
Money Market Funds - 2.1% | |||
Fidelity Cash Central Fund, 0.41% (c) | 17,803,220 | 17,809 | |
Fidelity Securities Lending Cash Central Fund 0.48% (c)(d) | 19,378,286 | 19,382 | |
TOTAL MONEY MARKET FUNDS | |||
(Cost $37,188) | 37,191 | ||
TOTAL INVESTMENT PORTFOLIO - 100.8% | |||
(Cost $1,578,783) | 1,750,199 | ||
NET OTHER ASSETS (LIABILITIES) - (0.8)% | (14,421) | ||
NET ASSETS - 100% | $1,735,778 |
Legend
(a) Non-income producing
(b) Security or a portion of the security is on loan at period end.
(c) Affiliated fund that is generally 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. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
(d) Investment made with cash collateral received from securities on loan.
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 |
(Amounts in thousands) | |
Fidelity Cash Central Fund | $77 |
Fidelity Securities Lending Cash Central Fund | 149 |
Total | $226 |
Other Affiliated Issuers
An affiliated company is a company in which the Fund has ownership of at least 5% of the voting securities. Fiscal year to date transactions with companies which are or were affiliates are as follows:
Affiliate (Amounts in thousands) | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
Ardmore Shipping Corp. | $14,788 | $4,433 | $5,247 | $466 | $-- |
Total | $14,788 | $4,433 | $5,247 | $466 | $-- |
Investment Valuation
The following is a summary of the inputs used, as of October 31, 2016, involving the Fund's assets and liabilities carried at fair 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 below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
Valuation Inputs at Reporting Date: | ||||
Description | Total | Level 1 | Level 2 | Level 3 |
(Amounts in thousands) | ||||
Investments in Securities: | ||||
Equities: | ||||
Consumer Discretionary | $202,999 | $202,999 | $-- | $-- |
Consumer Staples | 54,098 | 54,098 | -- | -- |
Energy | 59,330 | 59,330 | -- | -- |
Financials | 326,407 | 326,407 | -- | -- |
Health Care | 254,838 | 253,117 | 164 | 1,557 |
Industrials | 300,288 | 300,288 | -- | -- |
Information Technology | 316,647 | 316,647 | -- | -- |
Materials | 53,579 | 53,579 | -- | -- |
Real Estate | 119,026 | 119,026 | -- | -- |
Utilities | 25,796 | 25,796 | -- | -- |
Money Market Funds | 37,191 | 37,191 | -- | -- |
Total Investments in Securities: | $1,750,199 | $1,748,478 | $164 | $1,557 |
The following is a summary of transfers between Level 1 and Level 2 for the period ended October 31, 2016. Transfers are assumed to have occurred at the beginning of the period, and are primarily attributable to the valuation techniques used for foreign equity securities, as discussed in the accompanying Notes to Financial Statements:
Transfers | Total (000s) |
Level 1 to Level 2 | $0 |
Level 2 to Level 1 | $49,680 |
Other Information
Distribution of investments by country or territory of incorporation, as a percentage of Total Net Assets, is as follows (Unaudited):
United States of America | 82.8% |
United Kingdom | 6.3% |
Japan | 3.2% |
Switzerland | 3.1% |
Bermuda | 2.0% |
Isle of Man | 1.3% |
Others (Individually Less Than 1%) | 1.3% |
100.0% |
See accompanying notes which are an integral part of the financial statements.
Financial Statements
Statement of Assets and Liabilities
Amounts in thousands (except per-share amount) | October 31, 2016 (Unaudited) | |
Assets | ||
Investment in securities, at value (including securities loaned of $18,977) — See accompanying schedule: Unaffiliated issuers (cost $1,541,595) | $1,713,008 | |
Fidelity Central Funds (cost $37,188) | 37,191 | |
Total Investments (cost $1,578,783) | $1,750,199 | |
Cash | 1,934 | |
Receivable for investments sold | 26,838 | |
Receivable for fund shares sold | 484 | |
Dividends receivable | 1,336 | |
Distributions receivable from Fidelity Central Funds | 15 | |
Prepaid expenses | 5 | |
Other receivables | 34 | |
Total assets | 1,780,845 | |
Liabilities | ||
Payable for investments purchased | $20,171 | |
Payable for fund shares redeemed | 3,877 | |
Accrued management fee | 1,221 | |
Other affiliated payables | 376 | |
Other payables and accrued expenses | 43 | |
Collateral on securities loaned, at value | 19,379 | |
Total liabilities | 45,067 | |
Net Assets | $1,735,778 | |
Net Assets consist of: | ||
Paid in capital | $1,535,231 | |
Distributions in excess of net investment income | (615) | |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | 29,797 | |
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies | 171,365 | |
Net Assets, for 100,301 shares outstanding | $1,735,778 | |
Net Asset Value, offering price and redemption price per share ($1,735,778 ÷ 100,301 shares) | $17.31 |
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Amounts in thousands | Six months ended October 31, 2016 (Unaudited) | |
Investment Income | ||
Dividends (including $466 earned from other affiliated issuers) | $11,058 | |
Income from Fidelity Central Funds | 226 | |
Total income | 11,284 | |
Expenses | ||
Management fee | ||
Basic fee | $6,783 | |
Performance adjustment | 1,288 | |
Transfer agent fees | 1,993 | |
Accounting and security lending fees | 299 | |
Custodian fees and expenses | 26 | |
Independent trustees' fees and expenses | 4 | |
Registration fees | 15 | |
Audit | 29 | |
Legal | 5 | |
Interest | 1 | |
Miscellaneous | 10 | |
Total expenses before reductions | 10,453 | |
Expense reductions | (83) | 10,370 |
Net investment income (loss) | 914 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | 49,397 | |
Fidelity Central Funds | 10 | |
Other affiliated issuers | (4,131) | |
Foreign currency transactions | 45 | |
Total net realized gain (loss) | 45,321 | |
Change in net unrealized appreciation (depreciation) on: Investment securities | (14,838) | |
Assets and liabilities in foreign currencies | (72) | |
Total change in net unrealized appreciation (depreciation) | (14,910) | |
Net gain (loss) | 30,411 | |
Net increase (decrease) in net assets resulting from operations | $31,325 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Amounts in thousands | Six months ended October 31, 2016 (Unaudited) | Year ended April 30, 2016 |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $914 | $3,301 |
Net realized gain (loss) | 45,321 | 117,811 |
Change in net unrealized appreciation (depreciation) | (14,910) | (188,989) |
Net increase (decrease) in net assets resulting from operations | 31,325 | (67,877) |
Distributions to shareholders from net investment income | – | (11,174) |
Distributions to shareholders from net realized gain | (45,376) | (189,953) |
Total distributions | (45,376) | (201,127) |
Share transactions | ||
Proceeds from sales of shares | 79,165 | 511,008 |
Reinvestment of distributions | 44,022 | 195,114 |
Cost of shares redeemed | (329,148) | (394,729) |
Net increase (decrease) in net assets resulting from share transactions | (205,961) | 311,393 |
Redemption fees | 61 | 320 |
Total increase (decrease) in net assets | (219,951) | 42,709 |
Net Assets | ||
Beginning of period | 1,955,729 | 1,913,020 |
End of period | $1,735,778 | $1,955,729 |
Other Information | ||
Distributions in excess of net investment income end of period | $(615) | $(1,529) |
Shares | ||
Sold | 4,487 | 27,869 |
Issued in reinvestment of distributions | 2,524 | 10,433 |
Redeemed | (18,616) | (22,415) |
Net increase (decrease) | (11,605) | 15,887 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Small Cap Stock Fund
Six months ended (Unaudited) October 31, | Years ended April 30, | |||||
2016 | 2016 | 2015 | 2014 | 2013 | 2012 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $17.48 | $19.92 | $20.83 | $19.78 | $18.49 | $21.70 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .01 | .03 | .14 | .12B | .09 | (.05)C |
Net realized and unrealized gain (loss) | .23 | (.50)D | 2.50 | 3.24 | 1.76 | (3.16) |
Total from investment operations | .24 | (.47) | 2.64 | 3.36 | 1.85 | (3.21) |
Distributions from net investment income | – | (.11) | (.12) | (.06) | (.08) | – |
Distributions from net realized gain | (.41) | (1.86) | (3.43) | (2.25) | (.48) | –E |
Total distributions | (.41) | (1.97) | (3.55) | (2.31) | (.56) | –E |
Redemption fees added to paid in capitalA,E | – | – | – | – | – | – |
Net asset value, end of period | $17.31 | $17.48 | $19.92 | $20.83 | $19.78 | $18.49 |
Total ReturnF,G | 1.35% | (2.79)%D | 14.23% | 18.08% | 10.52% | (14.78)% |
Ratios to Average Net AssetsH,I | ||||||
Expenses before reductions | 1.07%J | 1.00% | .66% | .68% | .72% | 1.12% |
Expenses net of fee waivers, if any | 1.07%J | .99% | .66% | .67% | .72% | 1.12% |
Expenses net of all reductions | 1.07%J | .99% | .66% | .67% | .69% | 1.10% |
Net investment income (loss) | .09%J | .17% | .71% | .57%B | .51% | (.26)%C |
Supplemental Data | ||||||
Net assets, end of period (in millions) | $1,736 | $1,956 | $1,913 | $2,050 | $2,500 | $3,219 |
Portfolio turnover rateK | 53%J | 59% | 64% | 50% | 75% | 104% |
A Calculated based on average shares outstanding during the period.
B Net Investment income per share reflects a large, non-recurring dividend which amounted to $.03 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .43%.
C Net Investment income per share reflects a large, non-recurring dividend which amounted to $.02 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been (.35) %.
D Net realized and unrealized gain (loss) per share reflects proceeds from litigation which amounted to $.03 per share. Excluding these litigation proceeds, the total return would have been (2.96)%.
E Amount represents less than $.005 per share.
F Total returns for periods of less than one year are not annualized.
G Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
H Fees and expenses of any 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.
I Expense ratios reflect operating expenses of the Fund. 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 Fund during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the Fund.
J Annualized
K Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended October 31, 2016
(Amounts in thousands except percentages)
1. Organization.
Fidelity Small Cap Stock Fund (the Fund) is a fund of Fidelity Concord Street Trust (the Trust) (formerly a fund of Fidelity Commonwealth Trust) and is authorized to issue an unlimited number of shares. Share transactions on the Statement of Changes in Net Assets may contain exchanges between affiliated funds. 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.
2. Investments in Fidelity Central Funds.
The Fund invests in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser 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 the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website 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. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Trustees (the Board) has delegated the day to day responsibility for the valuation of the Fund's investments to the Fair Value Committee (the Committee) established by the Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, the Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment specific events. The frequency with which these procedures are used cannot be predicted and they may be utilized to a significant extent. The Committee oversees the Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing the Fund's investments and ratifies the fair value determinations of the Committee.
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)
Valuation techniques used to value the Fund's investments by major category are as follows:
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing vendor 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 or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For foreign equity securities, when market or security specific events arise, comparisons to the valuation of American Depositary Receipts (ADRs), futures contracts, Exchange-Traded Funds (ETFs) and certain indexes as well as quoted prices for similar securities may be used and would be categorized as Level 2 in the hierarchy. Utilizing these techniques may result in transfers between Level 1 and Level 2. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
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 October 31, 2016, including information on transfers between Levels 1 and 2 is included at the end of the Fund's Schedule of Investments.
Foreign Currency. The Fund may use 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 rates 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 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. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Distributions received on securities that represent a return of capital or capital gain are recorded as a reduction of cost of investments and/or as a realized gain. Subsequent to ex-dividend date the Fund determines the components of these distributions, based upon receipt of tax filings or other correspondence relating to the underlying investment. Interest income is accrued as earned and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.
Expenses. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. 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 under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. The Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction. Foreign taxes are provided for based on the Fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.
Distributions are declared and recorded on the ex-dividend date. 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. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to futures contracts, foreign currency transactions, partnerships and losses deferred due to wash sales and excise tax regulations.
The federal tax cost of investment securities and unrealized appreciation (depreciation) as of period end were as follows:
Gross unrealized appreciation | $265,539 |
Gross unrealized depreciation | (97,417) |
Net unrealized appreciation (depreciation) on securities | $168,122 |
Tax cost | $1,582,077 |
The Fund elected to defer to its next fiscal year approximately $11,320 of capital losses recognized during the period November 1, 2015 to April 30, 2016. The Fund elected to defer to its next fiscal year approximately $1,522 of ordinary losses recognized during the period January 1, 2016 to April 30, 2016.
Short-Term Trading (Redemption) Fees. Shares held by investors in the Fund less than 90 days may have been subject to a redemption fee equal to 2.00% of the NAV of shares redeemed. All redemption fees, which reduce the proceeds of the shareholder redemption, are retained by the Fund and accounted for as an addition to paid in capital.
4. Purchases and Sales of Investments.
Purchases and sales of securities, other than short sales and short-term securities, aggregated $503,098 and $722,402, respectively.
5. Fees and Other Transactions with Affiliates.
Management Fee. Fidelity Management & Research Company (the investment adviser) 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 .45% of the Fund's average net assets and an annualized group fee rate that averaged .25% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by the investment adviser, including any mutual funds previously advised by the investment adviser that are currently advised by Fidelity SelectCo, LLC, an affiliate of the investment adviser. The group fee rate decreases as assets under management increase and increases as assets under management decrease. In addition, the management fee is subject to a performance adjustment (up to a maximum of +/- .20% of the Fund's average net assets over a 36 month performance period). The upward or downward adjustment to the management fee is based on the Fund's relative investment performance as compared to its benchmark index, the Russell 2000 Index, over the same 36 month performance period. For the reporting period, the total annualized management fee rate, including the performance adjustment, was .83% of the Fund's average net assets. The performance adjustment included in the management fee rate may be higher or lower than the maximum performance adjustment rate due to the difference between the average net assets for the reporting and performance periods.
Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc. (FIIOC), an affiliate of the investment adviser, is the Fund's transfer, dividend disbursing and shareholder servicing agent. FIIOC receives account fees and asset-based fees that vary according to account size and type of account. FIIOC pays for typesetting, printing and mailing of shareholder reports, except proxy statements. For the period, the transfer agent fees were equivalent to an annualized rate of .20% of average net assets.
Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of the investment adviser, maintains the Fund's accounting records. The accounting fee is based on the level of average net assets for each 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.
Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. Brokerage commissions are included in net realized gain (loss) and change in net unrealized appreciation (depreciation) in the Statement of Operations. The commissions paid to these affiliated firms were $33 for the period.
Interfund Lending Program. Pursuant to an Exemptive Order issued by the SEC, the Fund, along with other registered investment companies having management contracts with Fidelity Management & Research Company (FMR) or other affiliated entities of FMR, may participate in an interfund lending program. This program provides an alternative credit facility allowing the funds to borrow from, or lend money to, other participating affiliated funds. At period end, there were no interfund loans outstanding. The Fund's activity in this program during the period for which loans were outstanding was as follows:
Borrower or Lender | Average Loan Balance | Weighted Average Interest Rate | Interest Expense |
Borrower | $8,721 | .61% | $1 |
Interfund Trades. The Fund may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
6. Committed Line of Credit.
The Fund participates with other funds managed by the investment adviser or an affiliate in a $4.25 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 $3 and is reflected in Miscellaneous expenses on the Statement of Operations. During the period, the Fund did not borrow on this line of credit.
7. Security Lending.
The Fund lends portfolio securities through a lending agent from time to time in order to earn additional income. For equity securities, a lending agent is used and may loan securities to certain qualified borrowers, including Fidelity Capital Markets (FCM), a broker-dealer affiliated with the Fund. On the settlement date of the loan, the Fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the Fund and any additional required collateral is delivered to the Fund on the next business day. The Fund or borrower may terminate the loan at any time, and if the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, the Fund may apply collateral received from the borrower against the obligation. The Fund may experience delays and costs in recovering the securities loaned. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. The value of securities loaned to FCM at period end was $134. Security lending income represents the income earned on investing cash collateral, less rebates paid to borrowers and any lending agent fees associated with the loan, plus any premium payments received for lending certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds. Total security lending income during the period amounted to $149, including $5 from securities loaned to FCM.
8. Expense Reductions.
Commissions paid to certain brokers with whom the investment adviser, or its affiliates, places trades on behalf of the Fund include an amount in addition to trade execution, which may be rebated back to the Fund to offset certain expenses. This amount totaled $76 for the period.
In addition, during the period the investment adviser reimbursed and/or waived a portion of operating expenses in the amount of $7.
9. Other.
The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund's maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including redemption fees and (2) ongoing costs, including management fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (May 1, 2016 to October 31, 2016).
Actual Expenses
The first line of the accompanying table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. 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 provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. 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.
Annualized Expense Ratio-A | Beginning Account Value May 1, 2016 | Ending Account Value October 31, 2016 | Expenses Paid During Period-B May 1, 2016 to October 31, 2016 | |
Actual | 1.07% | $1,000.00 | $1,013.50 | $5.43 |
Hypothetical-C | $1,000.00 | $1,019.81 | $5.45 |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to the Fund's annualized expense ratio, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).
C 5% return per year before expenses
Board Approval of Investment Advisory Contracts and Management Fees
Fidelity Small Cap Stock Fund
Each year, the Board of Trustees, including the Independent Trustees (together, the Board), votes on the renewal of the management contract with Fidelity Management & Research Company (FMR) and the sub-advisory agreements (together, the Advisory Contracts) for the fund. The Board, assisted by the advice of fund counsel and Independent Trustees' counsel, requests and considers a broad range of information relevant to the renewal of the Advisory Contracts throughout the year.
The Board meets regularly and, at each of its meetings, covers an extensive agenda of topics and materials and considers factors that are relevant to its annual consideration of the renewal of the fund's Advisory Contracts, including the services and support provided to the fund and its shareholders. The Board has established various standing committees (Committees), each composed of and chaired by Independent Trustees with varying backgrounds, to which the Board has assigned specific subject matter responsibilities in order to enhance effective decision-making by the Board. The Board, acting directly and through its Committees, requests and receives information concerning the annual consideration of the renewal of the fund's Advisory Contracts. The Board also meets as needed to consider matters specifically related to the Board's annual consideration of the renewal of the Advisory Contracts. Members of the Board may also meet with trustees of other Fidelity funds through ad hoc joint committees to discuss certain matters relevant to all of the Fidelity funds.
At its July 2016 meeting, the Board unanimously determined to renew the fund's Advisory Contracts. In reaching its determination, the Board considered all factors it believed relevant, including (i) the nature, extent, and quality of the services to be provided to the fund and its shareholders (including the investment performance of the fund); (ii) the competitiveness of the fund's management fee and total expense ratio relative to peer funds; (iii) the total costs of the services to be provided by and the profits to be realized by Fidelity from its relationships with the fund; and (iv) the extent to which, if any, economies of scale exist and would be realized as the fund grows, and whether any economies of scale are appropriately shared with fund shareholders.
In considering whether to renew the Advisory Contracts for the fund, the Board reached a determination, with the assistance of fund counsel and Independent Trustees' counsel and through the exercise of its business judgment, that the renewal of the Advisory Contracts was in the best interests of the fund and its shareholders and that the compensation payable under the Advisory Contracts was fair and reasonable. The Board's decision to renew the Advisory Contracts was not based on any single factor, but rather was based on a comprehensive consideration of all the information provided to the Board at its meetings throughout the year. The Board, in reaching its determination to renew the Advisory Contracts, was aware that shareholders of the fund have a broad range of investment choices available to them, including a wide choice among funds offered by Fidelity's competitors, and that the fund's shareholders, who have the opportunity to review and weigh the disclosure provided by the fund in its prospectus and other public disclosures, have chosen to invest in this fund, which is part of the Fidelity family of funds.
Nature, Extent, and Quality of Services Provided. The Board considered Fidelity's staffing as it relates to the fund, including the backgrounds of investment personnel of Fidelity, and also considered the fund's investment objective, strategies, and related investment philosophy. The Independent Trustees also had discussions with senior management of Fidelity's investment operations and investment groups. The Board considered the structure of the investment personnel compensation program and whether this structure provides appropriate incentives to act in the best interests of the fund. Additionally, the Board considered the portfolio managers' investments, if any, in the funds that they manage.Resources Dedicated to Investment Management and Support Services. The Board and the Fund Oversight and Research Committees reviewed the general qualifications and capabilities of Fidelity's investment staff, including its size, education, experience, and resources, as well as Fidelity's approach to recruiting, training, managing, and compensating investment personnel. The Board noted that Fidelity has continued to increase the resources devoted to non-U.S. offices, including expansion of Fidelity's global investment organization. The Board also noted that Fidelity's analysts have extensive resources, tools and capabilities that allow them to conduct sophisticated quantitative and fundamental analysis, as well as credit analysis of issuers, counterparties and guarantors. Further, the Board considered that Fidelity's investment professionals have sufficient access to global information and data so as to provide competitive investment results over time, and that those professionals also have access to sophisticated tools that permit them to assess portfolio construction and risk and performance attribution characteristics continuously, as well as to transmit new information and research conclusions rapidly around the world. Additionally, in its deliberations, the Board considered Fidelity's trading, risk management, compliance, and technology and operations capabilities and resources, which are integral parts of the investment management process.Shareholder and Administrative Services. The Board considered (i) the nature, extent, quality, and cost of advisory, administrative, and shareholder services performed by FMR, the sub-advisers (together with FMR, the Investment Advisers), and their affiliates under the Advisory Contracts and under separate agreements covering transfer agency, pricing and bookkeeping, and securities lending services for the fund; (ii) the nature and extent of the supervision of third party service providers, principally custodians, subcustodians, and pricing vendors; and (iii) the resources devoted to, and the record of compliance with, the fund's compliance policies and procedures. The Board also reviewed the allocation of fund brokerage, including allocations to brokers affiliated with the Investment Advisers, the use of brokerage commissions to pay fund expenses, and the use of "soft" commission dollars to pay for research services.The Board noted that the growth of fund assets over time across the complex allows Fidelity to reinvest in the development of services designed to enhance the value or convenience of the Fidelity funds as investment vehicles. These services include 24-hour access to account information and market information through telephone representatives and over the Internet, investor education materials and asset allocation tools, and the expanded availability of Fidelity Investor Centers.In 2014, the Board formed an ad hoc Committee on Transfer Agency Fees to review the variety of transfer agency fee structures throughout the industry and Fidelity's competitive positioning with respect to industry participants.Investment in a Large Fund Family. The Board considered the benefits to shareholders of investing in a Fidelity fund, including the benefits of investing in a fund that is part of a large family of funds offering a variety of investment disciplines and providing a large variety of mutual fund investor services. The Board noted that Fidelity had taken, or had made recommendations that resulted in the Fidelity funds taking, a number of actions over the previous year that benefited particular funds, including: (i) continuing to dedicate additional resources to investment research and to the support of the senior management team that oversees asset management; (ii) continuing efforts to enhance Fidelity's global research capabilities; (iii) launching new funds and making other enhancements to meet client needs; (iv) broadening eligibility requirements for certain lower-priced share classes of, and streamlining the fee structure for, certain existing equity index funds; (v) lowering expense caps for certain existing funds and classes to reduce expenses paid by shareholders; (vi) eliminating redemption fees for certain variable insurance product funds and classes; (vii) continuing to launch dedicated lower cost underlying funds to meet portfolio construction needs related to expanding underlying fund options for Fidelity funds of funds, specifically for the Freedom Fund product lines; (viii) launching a lower cost share class for use by the Freedom Index Fund product line; (ix) rationalizing product lines and gaining increased efficiencies through fund mergers and share class consolidations; (x) continuing to develop, acquire and implement systems and technology to improve services to the funds and shareholders, strengthen information security, and increase efficiency; (xi) implementing investment enhancements to further strengthen Fidelity's target date product line to increase investors' probability of success in achieving their goals; (xii) accelerating the conversion of all remaining Class B shares to Class A shares, which have a lower expense structure; and (xiii) implementing changes to Fidelity's money market fund product line in response to recent regulatory reforms.Investment Performance. The Board considered whether the fund has operated in accordance with its investment objective, as well as its record of compliance with its investment restrictions and its performance history. The Board noted that there were portfolio management changes for the fund in September 2014 and February 2016.The Board took into account discussions with representatives of the Investment Advisers about fund investment performance that occur at Board meetings throughout the year. In this regard the Board noted that as part of regularly scheduled fund reviews and other reports to the Board on fund performance, the Board considers annualized return information for the fund, for different time periods, measured against a securities market index ("benchmark index") and a peer group of funds with similar objectives ("peer group"), if any. In its evaluation of fund investment performance, the Board gave particular attention to information indicating changes in performance of certain Fidelity funds for specific time periods and discussed with the Investment Advisers the reasons for any overperformance or underperformance.In addition to reviewing absolute and relative fund performance, the Independent Trustees periodically consider the appropriateness of fund performance metrics in evaluating the results achieved. In general, the Independent Trustees believe that fund performance should be evaluated based on net performance (after fees and expenses) of both the highest performing and lowest performing fund share classes, where applicable, compared to appropriate benchmark indices, over appropriate time periods that may include full market cycles, and compared to peer groups, as applicable, over the same periods, taking into account relevant factors including the following: general market conditions; issuer-specific information; and fund cash flows and other factors.The Independent Trustees recognize that shareholders evaluate performance on a net basis over their own holding periods, for which one-, three-, and five-year periods are often used as a proxy. For this reason, the performance information reviewed by the Board also included net cumulative calendar year total return information for the fund and an appropriate benchmark index and peer group for the most recent one-, three-, and five-year periods, as shown below. Returns are shown compared to the 25th percentile (top of box, 75% beaten) and 75th percentile (bottom of box, 25% beaten) of the peer universe.Fidelity Small Cap Stock Fund
Fidelity Small Cap Stock Fund
Corporate Headquarters
245 Summer St.
Boston, MA 02210
www.fidelity.com
SLCX-SANN-1216
1.711817.118
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 Concord Street Trust’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 Concord Street Trust’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 Concord Street Trust
By: | /s/Stacie M. Smith |
Stacie M. Smith | |
President and Treasurer | |
Date: | December 23, 2016 |
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/Stacie M. Smith |
Stacie M. Smith | |
President and Treasurer | |
Date: | December 23, 2016 |
By: | /s/Howard J. Galligan III |
Howard J. Galligan III | |
Chief Financial Officer | |
Date: | December 23, 2016 |