Average annual total return reflects the change in the value of an investment, assuming reinvestment of the class' distributions from dividend
income and capital gains (the profits earned upon the sale of securities that have grown in value, if any) and assuming a constant rate of performance each year. The $10,000 table and the fund's returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. During periods of reimbursement by Fidelity, a fund's total return will be greater than it would be had the
reimbursement not occurred. How a fund did yesterday is no guarantee of how it will do tomorrow. Returns reflect the conversion of Class B
shares to Class A shares after a maximum of seven years.
Average Annual Total Returns
Periods ended July 31, 2013
|
Past 1
year
|
Past 5
years
|
Past 10
years
|
Class A (incl. 5.75% sales charge)
|
33.79%
|
5.19%
|
12.55%
|
Class T (incl. 3.50% sales charge)
|
36.69%
|
5.45%
|
12.53%
|
Class B (incl. contingent deferred sales charge)
A
|
35.83%
|
5.27%
|
12.59%
|
Class C (incl. contingent deferred sales charge)
B
|
39.90%
|
5.66%
|
12.38%
|
A
Class B shares' contingent deferred sales charges included in the past one year, past five years, and past ten years total return figures are 5%, 2%, and 0%, respectively.
B
Class C shares' contingent deferred sales charges included in the past one year, past five years, and past ten years total return figures are 1%, 0%, and 0%, respectively.
Annual Report
$10,000 Over 10 Years
Let's say hypothetically that $10,000 was invested in Fidelity Advisor® Leveraged Company Stock Fund - Class A on July 31, 2003, and the current
5.75% sales charge was paid. The chart shows how the value of your investment would have changed, and also shows how the S&P 500® Index
performed over the same period.
Annual Report
Market Recap:
The bull run in U.S. stocks comfortably settled into a fifth year, as major equity benchmarks ripped through records during the 12
months ending July 31, 2013. Gains were fueled by a generally improving global economy and accommodative monetary policies worldwide. The
tone was positive for most of the year, based largely on stronger U.S. economic data, including employment, housing and consumer sentiment.
Setting a series of new highs along the way, the broad-based S&P 500® Index rose an impressive 25.00% for the 12 months, while the blue-chip-laden Dow Jones Industrial Average
SM
also moved into record territory en route to a 22.36% gain. The growth-oriented Nasdaq Composite Index®
had a similarly strong run, advancing 25.15%. During the year, markets were resilient amid intermittent volatility over debt woes in Europe, the
2012 U.S. presidential election and year-end Congressional gridlock over the federal budget. In mid-to-late June, concern arose about the U.S.
Federal Reserve possibly tapering its sustaining bond-buying strategy - which prompted a brief, but steep, market sell-off. However, investors'
continued quest for yield and the Fed's pledge to keep buying bonds until the economy showed significant improvement overpowered the uncertainty and helped equities climb notably higher in July to close the period on a strong note.
Comments from Thomas Soviero, Portfolio Manager of Fidelity Advisor
®
Leveraged Company Stock Fund:
For the year, the fund's
Class A, Class T, Class B and Class C shares returned 41.95%, 41.65%, 40.83% and 40.90%, respectively (excluding sales charges), significantly
outperforming the S&P 500®. I concentrate the fund in what I consider to be my best ideas. I made the fund more U.S.-centric, adding to consumer discretionary names such as major automotive manufacturers Ford Motor and General Motors. I also sought to take advantage of the recent
manufacturing renaissance in the U.S. The fund's largest holding and top contributor to relative performance was chemicals manufacturer
LyondellBasell Industries. Other decisions that helped included largely avoiding consumer electronics giant and underperforming index component Apple - which was not held by the fund at period end - and overweighting outperforming video game retailer GameStop. During the
period, the fund's performance relative to the index was curtailed the most by its roughly 7% cash weighting, which I held as I waited for new
opportunities, but was a negative in a strong market. An underweighting in financials also detracted. At the individual issuer level, global independent power producer AES, with headquarters in Virginia, underperformed and detracted, as did an out-of-benchmark position in South
Africa-based AngloGold Ashanti.
Annual Report
The views expressed above reflect those of the portfolio manager(s) only through the end of the period as stated on the cover of this report and do
not necessarily represent the views of Fidelity or any other person in the Fidelity organization. Any such views are subject to change at any time
based upon market or other conditions and Fidelity disclaims any responsibility to update such views. These views may not be relied on as
investment advice and, because investment decisions for a Fidelity fund are based on numerous factors, may not be relied on as an indication of
trading intent on behalf of any Fidelity fund.
Annual Report
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments or redemption proceeds, and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees and other Fund expenses. This Example
is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of
investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (February 1, 2013 to July 31,
2013).
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.
Annual Report
|
Annualized
Expense Ratio
B
|
Beginning
Account Value
February 1, 2013
|
Ending
Account Value
July 31, 2013
|
Expenses Paid
During Period
*
February 1, 2013
to July 31, 2013
|
Class A
|
1.10%
|
|
|
|
Actual
|
|
$ 1,000.00
|
$ 1,151.60
|
$ 5.87
|
Hypothetical
A
|
|
$ 1,000.00
|
$ 1,019.34
|
$ 5.51
|
Class T
|
1.33%
|
|
|
|
Actual
|
|
$ 1,000.00
|
$ 1,150.10
|
$ 7.09
|
Hypothetical
A
|
|
$ 1,000.00
|
$ 1,018.20
|
$ 6.66
|
Class B
|
1.90%
|
|
|
|
Actual
|
|
$ 1,000.00
|
$ 1,146.90
|
$ 10.11
|
Hypothetical
A
|
|
$ 1,000.00
|
$ 1,015.37
|
$ 9.49
|
Class C
|
1.84%
|
|
|
|
Actual
|
|
$ 1,000.00
|
$ 1,147.30
|
$ 9.80
|
Hypothetical
A
|
|
$ 1,000.00
|
$ 1,015.67
|
$ 9.20
|
Institutional Class
|
.83%
|
|
|
|
Actual
|
|
$ 1,000.00
|
$ 1,152.90
|
$ 4.43
|
Hypothetical
A
|
|
$ 1,000.00
|
$ 1,020.68
|
$ 4.16
|
A
5% return per year before expenses
B
Annualized expense ratio reflects expenses net of applicable fee waivers.
*
Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by
181/365 (to reflect the one-half year period).
Annual Report
Investment Changes (Unaudited)
Top Ten Stocks as of July 31, 2013
|
|
% of fund's
net assets
|
% of fund's net assets
6 months ago
|
LyondellBasell Industries NV Class A
|
7.2
|
8.2
|
Service Corp. International
|
4.2
|
4.4
|
Comcast Corp. Class A
|
3.6
|
3.0
|
General Motors Co.
|
3.1
|
2.8
|
Ford Motor Co.
|
2.9
|
2.1
|
GameStop Corp. Class A
|
2.5
|
1.8
|
Tenet Healthcare Corp.
|
2.2
|
2.4
|
Bank of America Corp.
|
2.1
|
0.0
|
Boston Scientific Corp.
|
2.0
|
0.9
|
The AES Corp.
|
1.8
|
3.3
|
|
31.6
|
|
Top Five Market Sectors as of July 31, 2013
|
|
% of fund's
net assets
|
% of fund's net assets
6 months ago
|
Consumer Discretionary
|
26.0
|
24.6
|
Materials
|
11.3
|
12.7
|
Industrials
|
11.2
|
11.5
|
Health Care
|
10.6
|
9.0
|
Financials
|
9.9
|
7.1
|
Asset Allocation (% of fund's net assets)
|
As of July 31, 2013
*
|
As of January 31, 2013
**
|
|
Stocks 91.2%
|
|
|
Stocks 91.3%
|
|
|
Bonds 0.3%
|
|
|
Bonds 1.0%
|
|
|
Convertible
Securities 0.1%
|
|
|
Convertible
Securities 0.1%
|
|
|
Other Investments 0.1%
|
|
|
Other Investments 0.4%
|
|
|
Short-Term
Investments and
Net Other Assets (Liabilities) 8.3%
|
|
|
Short-Term
Investments and
Net Other Assets (Liabilities) 7.2%
|
|
*
Foreign investments
|
13.4%
|
|
**
Foreign investments
|
13.3%
|
|
Annual Report
Investments July 31, 2013
Showing Percentage of Net Assets
Common Stocks - 90.8%
|
|
Shares
|
|
Value (000s)
|
CONSUMER DISCRETIONARY - 25.7%
|
Auto Components - 1.9%
|
Delphi Automotive PLC
|
446,000
|
|
$ 23,959
|
Exide Technologies (a)(e)
|
3,282,263
|
|
427
|
Tenneco, Inc. (a)
|
630,300
|
|
30,462
|
TRW Automotive Holdings Corp. (a)
|
298,400
|
|
21,876
|
|
|
76,724
|
Automobiles - 6.5%
|
Ford Motor Co.
|
7,095,667
|
|
119,775
|
General Motors Co. (a)
|
3,454,500
|
|
123,913
|
General Motors Co.:
|
|
|
|
warrants 7/10/16 (a)
|
365,056
|
|
9,594
|
warrants 7/10/19 (a)
|
365,056
|
|
6,801
|
Motors Liquidation Co. GUC Trust (a)
|
100,812
|
|
3,292
|
|
|
263,375
|
Diversified Consumer Services - 4.2%
|
Service Corp. International
|
8,987,869
|
|
170,500
|
Hotels, Restaurants & Leisure - 0.4%
|
Penn National Gaming, Inc. (a)
|
297,660
|
|
14,880
|
Station Holdco LLC unit (h)(i)
|
116,342
|
|
7
|
|
|
14,887
|
Household Durables - 1.9%
|
Hovnanian Enterprises, Inc. Class A (a)(e)
|
1,181,000
|
|
6,318
|
Lennar Corp. Class A (e)
|
576,600
|
|
19,529
|
Newell Rubbermaid, Inc.
|
1,935,853
|
|
52,307
|
|
|
78,154
|
Leisure Equipment & Products - 0.2%
|
Callaway Golf Co. (e)
|
1,339,225
|
|
9,616
|
Media - 6.3%
|
Cinemark Holdings, Inc.
|
2,129,655
|
|
62,016
|
Comcast Corp. Class A
|
3,208,166
|
|
144,624
|
Gray Television, Inc. (a)(f)
|
3,167,163
|
|
24,736
|
Nexstar Broadcasting Group, Inc. Class A
|
664,102
|
|
23,934
|
|
|
255,310
|
Multiline Retail - 0.5%
|
Target Corp.
|
283,600
|
|
20,207
|
Specialty Retail - 3.8%
|
Asbury Automotive Group, Inc. (a)
|
314,878
|
|
15,379
|
Common Stocks - continued
|
|
Shares
|
|
Value (000s)
|
CONSUMER DISCRETIONARY - continued
|
Specialty Retail - continued
|
GameStop Corp. Class A (e)
|
2,061,075
|
|
$ 101,116
|
Sally Beauty Holdings, Inc. (a)
|
1,303,600
|
|
39,773
|
|
|
156,268
|
TOTAL CONSUMER DISCRETIONARY
|
|
1,045,041
|
CONSUMER STAPLES - 2.5%
|
Food Products - 2.2%
|
ConAgra Foods, Inc.
|
438,800
|
|
15,889
|
Darling International, Inc. (a)
|
2,916,158
|
|
59,198
|
Smithfield Foods, Inc. (a)
|
457,894
|
|
15,202
|
|
|
90,289
|
Personal Products - 0.3%
|
Revlon, Inc. (a)
|
459,739
|
|
11,535
|
TOTAL CONSUMER STAPLES
|
|
101,824
|
ENERGY - 9.6%
|
Energy Equipment & Services - 2.9%
|
Ensco PLC Class A
|
90,000
|
|
5,161
|
Halliburton Co.
|
943,707
|
|
42,646
|
Noble Corp.
|
753,990
|
|
28,802
|
Oil States International, Inc. (a)
|
203,434
|
|
19,780
|
Schlumberger Ltd.
|
90,600
|
|
7,368
|
Transocean Ltd. (United States)
|
316,300
|
|
14,917
|
|
|
118,674
|
Oil, Gas & Consumable Fuels - 6.7%
|
Alpha Natural Resources, Inc. (a)
|
5,150,437
|
|
28,018
|
Continental Resources, Inc. (a)
|
440,013
|
|
40,613
|
Forest Oil Corp. (a)
|
1,006,891
|
|
5,155
|
Hess Corp.
|
633,490
|
|
47,170
|
HollyFrontier Corp.
|
1,275,165
|
|
58,084
|
Kodiak Oil & Gas Corp. (a)
|
1,639,653
|
|
15,921
|
Peabody Energy Corp.
|
677,175
|
|
11,214
|
Range Resources Corp.
|
202,800
|
|
16,041
|
Common Stocks - continued
|
|
Shares
|
|
Value (000s)
|
ENERGY - continued
|
Oil, Gas & Consumable Fuels - continued
|
Valero Energy Corp.
|
1,003,334
|
|
$ 35,889
|
Western Refining, Inc. (e)
|
511,986
|
|
15,426
|
|
|
273,531
|
TOTAL ENERGY
|
|
392,205
|
FINANCIALS - 9.6%
|
Commercial Banks - 3.1%
|
CIT Group, Inc. (a)
|
170,690
|
|
8,553
|
Huntington Bancshares, Inc.
|
7,094,120
|
|
60,655
|
Regions Financial Corp.
|
2,739,606
|
|
27,423
|
SunTrust Banks, Inc.
|
836,400
|
|
29,098
|
|
|
125,729
|
Consumer Finance - 0.9%
|
American Express Co.
|
515,752
|
|
38,047
|
Diversified Financial Services - 3.5%
|
Bank of America Corp.
|
5,896,101
|
|
86,083
|
Citigroup, Inc.
|
1,110,553
|
|
57,904
|
|
|
143,987
|
Insurance - 1.2%
|
AFLAC, Inc.
|
530,400
|
|
32,715
|
Lincoln National Corp.
|
360,400
|
|
15,018
|
|
|
47,733
|
Real Estate Investment Trusts - 0.7%
|
Host Hotels & Resorts, Inc.
|
832,331
|
|
14,865
|
Sabra Health Care REIT, Inc.
|
452,492
|
|
11,873
|
|
|
26,738
|
Real Estate Management & Development - 0.1%
|
Realogy Holdings Corp.
|
119,300
|
|
5,364
|
Thrifts & Mortgage Finance - 0.1%
|
MGIC Investment Corp. (a)
|
328,300
|
|
2,508
|
TOTAL FINANCIALS
|
|
390,106
|
HEALTH CARE - 10.6%
|
Health Care Equipment & Supplies - 2.5%
|
Boston Scientific Corp. (a)
|
7,480,575
|
|
81,688
|
Covidien PLC
|
286,325
|
|
17,646
|
|
|
99,334
|
Common Stocks - continued
|
|
Shares
|
|
Value (000s)
|
HEALTH CARE - continued
|
Health Care Providers & Services - 5.3%
|
Community Health Systems, Inc.
|
655,424
|
|
$ 30,189
|
DaVita, Inc. (a)
|
303,353
|
|
35,313
|
HCA Holdings, Inc.
|
998,521
|
|
38,942
|
Tenet Healthcare Corp. (a)
|
2,004,163
|
|
89,486
|
Universal Health Services, Inc. Class B
|
317,795
|
|
22,230
|
|
|
216,160
|
Pharmaceuticals - 2.8%
|
Johnson & Johnson
|
127,900
|
|
11,959
|
Mallinckrodt PLC (a)
|
35,790
|
|
1,642
|
Merck & Co., Inc.
|
1,321,200
|
|
63,642
|
Sanofi SA sponsored ADR (e)
|
745,266
|
|
38,366
|
|
|
115,609
|
TOTAL HEALTH CARE
|
|
431,103
|
INDUSTRIALS - 11.1%
|
Aerospace & Defense - 1.4%
|
Honeywell International, Inc.
|
387,924
|
|
32,190
|
Huntington Ingalls Industries, Inc.
|
196,360
|
|
12,210
|
Textron, Inc.
|
497,300
|
|
13,616
|
|
|
58,016
|
Airlines - 2.5%
|
Delta Air Lines, Inc.
|
2,920,820
|
|
62,009
|
Southwest Airlines Co.
|
478,033
|
|
6,611
|
U.S. Airways Group, Inc. (a)
|
1,236,200
|
|
23,920
|
United Continental Holdings, Inc. (a)
|
309,700
|
|
10,793
|
|
|
103,333
|
Building Products - 1.0%
|
Armstrong World Industries, Inc. (a)
|
580,581
|
|
29,075
|
Owens Corning (a)
|
246,439
|
|
9,732
|
Owens Corning warrants 10/31/13 (a)
|
193,400
|
|
193
|
|
|
39,000
|
Commercial Services & Supplies - 1.0%
|
Deluxe Corp.
|
781,427
|
|
32,046
|
Tyco International Ltd.
|
267,791
|
|
9,322
|
|
|
41,368
|
Electrical Equipment - 2.0%
|
Belden, Inc.
|
649,536
|
|
38,069
|
Emerson Electric Co.
|
136,500
|
|
8,377
|
Common Stocks - continued
|
|
Shares
|
|
Value (000s)
|
INDUSTRIALS - continued
|
Electrical Equipment - continued
|
Generac Holdings, Inc.
|
373,058
|
|
$ 16,172
|
General Cable Corp.
|
365,868
|
|
11,532
|
Polypore International, Inc. (a)(e)
|
182,200
|
|
7,651
|
|
|
81,801
|
Industrial Conglomerates - 0.7%
|
Carlisle Companies, Inc.
|
90,090
|
|
6,103
|
General Electric Co.
|
896,117
|
|
21,838
|
|
|
27,941
|
Machinery - 1.7%
|
Harsco Corp.
|
674,131
|
|
17,366
|
Ingersoll-Rand PLC
|
605,977
|
|
36,995
|
Pentair Ltd.
|
64,254
|
|
3,925
|
Timken Co.
|
187,566
|
|
10,958
|
|
|
69,244
|
Marine - 0.3%
|
Navios Maritime Holdings, Inc.
|
1,788,039
|
|
9,995
|
Road & Rail - 0.4%
|
Hertz Global Holdings, Inc. (a)
|
583,000
|
|
14,931
|
Trading Companies & Distributors - 0.1%
|
Edgen Group, Inc. Class A (a)
|
633,944
|
|
4,976
|
TOTAL INDUSTRIALS
|
|
450,605
|
INFORMATION TECHNOLOGY - 6.8%
|
Communications Equipment - 1.3%
|
Cisco Systems, Inc.
|
1,982,651
|
|
50,657
|
Computers & Peripherals - 1.1%
|
EMC Corp.
|
1,160,700
|
|
30,352
|
NCR Corp. (a)
|
430,369
|
|
15,493
|
|
|
45,845
|
Electronic Equipment & Components - 0.8%
|
Avnet, Inc. (a)
|
489,587
|
|
18,443
|
Corning, Inc.
|
605,400
|
|
9,196
|
SMTC Corp. (a)
|
34,050
|
|
65
|
Viasystems Group, Inc. (a)
|
441,914
|
|
6,562
|
|
|
34,266
|
Internet Software & Services - 0.2%
|
VeriSign, Inc. (a)
|
194,300
|
|
9,295
|
Common Stocks - continued
|
|
Shares
|
|
Value (000s)
|
INFORMATION TECHNOLOGY - continued
|
Semiconductors & Semiconductor Equipment - 2.6%
|
Advanced Micro Devices, Inc. (a)(e)
|
1,295,308
|
|
$ 4,883
|
Fairchild Semiconductor International, Inc. (a)
|
924,426
|
|
11,666
|
Freescale Semiconductor Holdings I Ltd. (a)(e)
|
939,600
|
|
14,752
|
Intersil Corp. Class A
|
1,177,013
|
|
12,017
|
Micron Technology, Inc. (a)
|
1,890,455
|
|
25,049
|
ON Semiconductor Corp. (a)
|
4,465,694
|
|
36,797
|
|
|
105,164
|
Software - 0.8%
|
Autodesk, Inc. (a)
|
236,100
|
|
8,356
|
Citrix Systems, Inc. (a)
|
190,801
|
|
13,741
|
Microsoft Corp.
|
91,200
|
|
2,903
|
Nuance Communications, Inc. (a)
|
464,834
|
|
8,720
|
|
|
33,720
|
TOTAL INFORMATION TECHNOLOGY
|
|
278,947
|
MATERIALS - 11.3%
|
Chemicals - 8.8%
|
H.B. Fuller Co.
|
380,376
|
|
15,272
|
LyondellBasell Industries NV Class A
|
4,267,493
|
|
293,220
|
OMNOVA Solutions, Inc. (a)(f)
|
2,609,132
|
|
21,030
|
Phosphate Holdings, Inc. (a)
|
192,500
|
|
193
|
The Dow Chemical Co.
|
284,012
|
|
9,952
|
W.R. Grace & Co. (a)
|
256,156
|
|
19,678
|
|
|
359,345
|
Containers & Packaging - 2.2%
|
Rock-Tenn Co. Class A
|
608,992
|
|
69,638
|
Sealed Air Corp.
|
678,051
|
|
18,470
|
|
|
88,108
|
Metals & Mining - 0.1%
|
AngloGold Ashanti Ltd. sponsored ADR
|
437,500
|
|
5,762
|
Ormet Corp. (a)
|
500,000
|
|
5
|
Ormet Corp. (a)(i)
|
150,000
|
|
1
|
|
|
5,768
|
Paper & Forest Products - 0.2%
|
Neenah Paper, Inc.
|
231,700
|
|
9,168
|
TOTAL MATERIALS
|
|
462,389
|
Common Stocks - continued
|
|
Shares
|
|
Value (000s)
|
TELECOMMUNICATION SERVICES - 0.5%
|
Diversified Telecommunication Services - 0.5%
|
Intelsat SA
|
855,300
|
|
$ 18,338
|
Level 3 Communications, Inc. (a)
|
184,741
|
|
4,074
|
|
|
22,412
|
UTILITIES - 3.1%
|
Electric Utilities - 0.3%
|
FirstEnergy Corp.
|
341,796
|
|
13,012
|
Independent Power Producers & Energy Traders - 2.8%
|
Calpine Corp. (a)
|
1,970,200
|
|
39,424
|
The AES Corp.
|
5,982,695
|
|
74,425
|
|
|
113,849
|
TOTAL UTILITIES
|
|
126,861
|
TOTAL COMMON STOCKS
(Cost $2,583,324)
|
3,701,493
|
Nonconvertible Preferred Stocks - 0.4%
|
|
|
|
|
CONSUMER STAPLES - 0.1%
|
Personal Products - 0.1%
|
Revlon, Inc. Series A 12.75%
|
1,007,783
|
|
5,442
|
FINANCIALS - 0.3%
|
Diversified Financial Services - 0.3%
|
GMAC Capital Trust I Series 2, 8.125%
|
360,987
|
|
9,584
|
TOTAL NONCONVERTIBLE PREFERRED STOCKS
(Cost $22,062)
|
15,026
|
Corporate Bonds - 0.4%
|
|
Principal Amount (000s)
|
|
|
Convertible Bonds - 0.1%
|
INDUSTRIALS - 0.1%
|
Marine - 0.1%
|
Genco Shipping & Trading Ltd. 5% 8/15/15
|
|
$ 9,934
|
|
2,676
|
Corporate Bonds - continued
|
|
Principal Amount (000s)
|
|
Value (000s)
|
Nonconvertible Bonds - 0.3%
|
CONSUMER DISCRETIONARY - 0.3%
|
Automobiles - 0.0%
|
General Motors Corp.:
|
|
|
|
|
6.75% 5/1/28 (d)
|
|
$ 2,515
|
|
$ 0
|
7.125% 7/15/49 (d)
|
|
6,805
|
|
0
|
7.2% 1/15/11 (d)
|
|
18,790
|
|
0
|
8.25% 7/15/23 (d)
|
|
20,460
|
|
0
|
8.375% 7/15/33 (d)
|
|
41,210
|
|
0
|
8.8% 3/1/21 (d)
|
|
8,800
|
|
0
|
Multiline Retail - 0.3%
|
The Bon-Ton Department Stores, Inc. 10.625% 7/15/17
|
|
13,962
|
|
13,945
|
TOTAL CORPORATE BONDS
(Cost $17,458)
|
16,621
|
Floating Rate Loans - 0.1%
|
|
UTILITIES - 0.1%
|
Electric Utilities - 0.1%
|
Texas Competitive Electric Holdings Co. LLC/Texas Competitive Electric Holdings Finance, Inc.
Tranche B, term loan 4.7212% 10/10/17 (g)
(Cost $3,829)
|
|
4,289
|
|
3,008
|
Money Market Funds - 10.2%
|
|
Shares
|
|
Value (000s)
|
Fidelity Cash Central Fund, 0.11% (b)
|
339,411,742
|
|
$ 339,412
|
Fidelity Securities Lending Cash Central Fund, 0.12% (b)(c)
|
77,416,700
|
|
77,417
|
TOTAL MONEY MARKET FUNDS
(Cost $416,829)
|
416,829
|
TOTAL INVESTMENT PORTFOLIO - 101.9%
(Cost $3,043,502)
|
|
4,152,977
|
NET OTHER ASSETS (LIABILITIES) - (1.9)%
|
|
(78,779
)
|
NET ASSETS - 100%
|
$ 4,074,198
|
Legend
|
(a) Non-income producing
|
(b) 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, which are not covered by the Fund's Report of Independent Registered Public Accounting Firm, are
available on the SEC's website or upon request.
|
(c) Investment made with cash collateral received from securities on loan.
|
(d) Non-income producing - Security is in default.
|
(e) Security or a portion of the security is on loan at period end.
|
(f) Affiliated company
|
(g) Coupon rates for floating and adjustable rate securities reflect the rates in effect at period end.
|
(h) Investment is owned by an entity that is treated as a corporation for U.S. tax purposes and is owned by the Fund.
|
(i) 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 $8,000 or 0.0% of net assets.
|
Additional information on each restricted holding is as follows:
|
Security
|
Acquisition Date
|
Acquisition Cost (000s)
|
Ormet Corp.
|
5/14/07
|
$ 3,263
|
Station Holdco LLC unit
|
10/28/08 - 12/1/08
|
$ 4,745
|
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
|
$ 386
|
Fidelity Securities Lending Cash Central Fund
|
2,373
|
Total
|
$ 2,759
|
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
|
Gray Television, Inc.
|
$ 5,321
|
$ -
|
$ -
|
$ -
|
$ 24,736
|
OMNOVA Solutions, Inc.
|
18,994
|
-
|
-
|
-
|
21,030
|
Service Corp. International
|
147,381
|
-
|
38,217
|
2,516
|
-
|
Total
|
$ 171,696
|
$ -
|
$ 38,217
|
$ 2,516
|
$ 45,766
|
Other Information
|
The following is a summary of the inputs used, as of July 31, 2013, 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 in the table below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
|
Valuation Inputs at Reporting Date:
|
Description
(Amounts in thousands)
|
Total
|
Level 1
|
Level 2
|
Level 3
|
Investments in Securities:
|
|
|
|
|
Equities:
|
|
|
|
|
Consumer Discretionary
|
$ 1,045,041
|
$ 1,045,034
|
$ -
|
$ 7
|
Consumer Staples
|
107,266
|
107,266
|
-
|
-
|
Energy
|
392,205
|
392,205
|
-
|
-
|
Financials
|
399,690
|
399,690
|
-
|
-
|
Health Care
|
431,103
|
431,103
|
-
|
-
|
Industrials
|
450,605
|
450,605
|
-
|
-
|
Information Technology
|
278,947
|
278,947
|
-
|
-
|
Valuation Inputs at Reporting Date:
|
Description
(Amounts in thousands)
|
Total
|
Level 1
|
Level 2
|
Level 3
|
Investments in Securities:
|
|
|
|
|
Equities:
|
|
|
|
|
Materials
|
$ 462,389
|
$ 462,389
|
$ -
|
$ -
|
Telecommunication Services
|
22,412
|
22,412
|
-
|
-
|
Utilities
|
126,861
|
126,861
|
-
|
-
|
Corporate Bonds
|
16,621
|
-
|
16,621
|
-
|
Floating Rate Loans
|
3,008
|
-
|
3,008
|
-
|
Money Market Funds
|
416,829
|
416,829
|
-
|
-
|
Total Investments in Securities:
|
$ 4,152,977
|
$ 4,133,341
|
$ 19,629
|
$ 7
|
Distribution of investments by country or territory of incorporation, as a percentage of total net assets, is as follows. (Unaudited)
|
United States of America
|
86.6%
|
Netherlands
|
7.2%
|
Ireland
|
1.4%
|
Switzerland
|
1.3%
|
Others (Individually Less Than 1%)
|
3.5%
|
|
100.0%
|
See accompanying notes which are an integral part of the financial statements.
Annual Report
Statement of Assets and Liabilities
Amounts in thousands (except per-share amounts)
|
July 31, 2013
|
|
|
|
Assets
|
|
|
Investment in securities, at value (including securities loaned of $74,943) - See
accompanying schedule:
Unaffiliated issuers (cost $2,591,708)
|
$ 3,690,382
|
|
Fidelity Central Funds (cost $416,829)
|
416,829
|
|
Other affiliated issuers (cost $34,965)
|
45,766
|
|
Total Investments (cost $3,043,502)
|
|
$ 4,152,977
|
Receivable for investments sold
|
|
10
|
Receivable for fund shares sold
|
|
6,124
|
Dividends receivable
|
|
1,622
|
Interest receivable
|
|
814
|
Distributions receivable from Fidelity Central Funds
|
|
54
|
Other receivables
|
|
659
|
Total assets
|
|
4,162,260
|
|
|
|
Liabilities
|
|
|
Payable for fund shares redeemed
|
$ 6,352
|
|
Accrued management fee
|
2,004
|
|
Distribution and service plan fees payable
|
1,214
|
|
Other affiliated payables
|
728
|
|
Other payables and accrued expenses
|
347
|
|
Collateral on securities loaned, at value
|
77,417
|
|
Total liabilities
|
|
88,062
|
|
|
|
Net Assets
|
|
$ 4,074,198
|
Net Assets consist of:
|
|
|
Paid in capital
|
|
$ 3,316,323
|
Undistributed net investment income
|
|
7,496
|
Accumulated undistributed net realized gain (loss) on investments and foreign currency
transactions
|
|
(359,096)
|
Net unrealized appreciation (depreciation) on investments
|
|
1,109,475
|
Net Assets
|
|
$ 4,074,198
|
See accompanying notes which are an integral part of the financial statements.
Annual Report
Statement of Assets and Liabilities - continued
Amounts in thousands (except per-share amounts)
|
July 31, 2013
|
|
|
|
Calculation of Maximum Offering Price
Class A:
Net Asset Value
and redemption price per share ($1,490,413 ÷ 30,649 shares)
|
|
$ 48.63
|
|
|
|
Maximum offering price per share (100/94.25 of $48.63)
|
|
$ 51.60
|
Class T
:
Net Asset Value
and redemption price per share ($1,011,907 ÷ 21,263 shares)
|
|
$ 47.59
|
|
|
|
Maximum offering price per share (100/96.50 of $47.59)
|
|
$ 49.32
|
Class B
:
Net Asset Value
and offering price per share ($79,892 ÷ 1,752 shares)
A
|
|
$ 45.60
|
|
|
|
Class C
:
Net Asset Value
and offering price per share ($526,519 ÷ 11,534 shares)
A
|
|
$ 45.65
|
|
|
|
Institutional Class
:
Net Asset Value
, offering price and redemption price per share ($965,467 ÷ 19,548 shares)
|
|
$ 49.39
|
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.
Annual Report
Financial Statements - continued
Statement of Operations
Amounts in thousands
|
Year ended July 31, 2013
|
|
|
|
Investment Income
|
|
|
Dividends (including $2,516 earned from other affiliated issuers)
|
|
$ 57,654
|
Special dividends
|
|
8,020
|
Interest
|
|
6,637
|
Income from Fidelity Central Funds
|
|
2,759
|
Total income
|
|
75,070
|
|
|
|
Expenses
|
|
|
Management fee
|
$ 20,863
|
|
Transfer agent fees
|
7,096
|
|
Distribution and service plan fees
|
12,926
|
|
Accounting and security lending fees
|
998
|
|
Custodian fees and expenses
|
36
|
|
Independent trustees' compensation
|
21
|
|
Registration fees
|
146
|
|
Audit
|
65
|
|
Legal
|
13
|
|
Miscellaneous
|
25
|
|
Total expenses before reductions
|
42,189
|
|
Expense reductions
|
(134
)
|
42,055
|
Net investment income (loss)
|
|
33,015
|
Realized and Unrealized Gain (Loss)
Net realized gain (loss) on:
|
|
|
Investment securities:
|
|
|
Unaffiliated issuers
|
254,399
|
|
Other affiliated issuers
|
18,283
|
|
Foreign currency transactions
|
1
|
|
Total net realized gain (loss)
|
|
272,683
|
Change in net unrealized appreciation (depreciation) on investment securities
|
|
883,039
|
Net gain (loss)
|
|
1,155,722
|
Net
increase (decrease) in net assets resulting from operations
|
|
$ 1,188,737
|
See accompanying notes which are an integral part of the financial statements.
Annual Report
Statement of Changes in Net Assets
Amounts in thousands
|
Year ended
July 31,
2013
|
Year ended
July 31,
2012
|
Increase (Decrease) in Net Assets
|
|
|
Operations
|
|
|
Net investment income (loss)
|
$ 33,015
|
$ 6,161
|
Net realized gain (loss)
|
272,683
|
166,758
|
Change in net unrealized appreciation (depreciation)
|
883,039
|
(273,036
)
|
Net
increase (decrease) in net assets resulting
from operations
|
1,188,737
|
(100,117
)
|
Distributions to shareholders from net investment income
|
(2,596
)
|
(28,865
)
|
Share transactions - net increase (decrease)
|
(90,255
)
|
(562,983
)
|
Total increase (decrease) in net assets
|
1,095,886
|
(691,965)
|
|
|
|
Net Assets
|
|
|
Beginning of period
|
2,978,312
|
3,670,277
|
End of period (including undistributed net investment income of $7,496 and accumulated net
investment loss of $22,843, respectively)
|
$ 4,074,198
|
$ 2,978,312
|
See accompanying notes which are an integral part of the financial statements.
Annual Report
Financial Highlights - Class A
Years ended July 31,
|
2013
|
2012
|
2011
|
2010
|
2009
|
Selected Per-Share Data
|
|
|
|
|
|
Net asset value, beginning of period
|
$ 34.29
|
$ 35.01
|
$ 28.55
|
$ 23.69
|
$ 36.47
|
Income from Investment Operations
|
|
|
|
|
|
Net investment income (loss)
C
|
.44
F
|
.11
|
(.08)
|
.05
|
.27
|
Net realized and unrealized gain (loss)
|
13.94
|
(.51
)
|
6.61
|
4.91
|
(12.93
)
|
Total from investment operations
|
14.38
|
(.40
)
|
6.53
|
4.96
|
(12.66
)
|
Distributions from net investment income
|
(.04)
|
(.32)
|
(.01)
G
|
(.09)
|
(.12)
|
Distributions from net realized gain
|
-
|
-
|
(.06
)
G
|
(.01
)
|
-
|
Total distributions
|
(.04
)
|
(.32
)
|
(.07
)
|
(.10
)
|
(.12
)
|
Net asset value, end of period
|
$ 48.63
|
$ 34.29
|
$ 35.01
|
$ 28.55
|
$ 23.69
|
Total Return
A,B
|
41.95%
|
(1.04)%
|
22.88%
|
20.96%
|
(34.57)%
|
Ratios to Average Net Assets
D,H
|
|
|
|
|
|
Expenses before reductions
|
1.11%
|
1.13%
|
1.13%
|
1.15%
|
1.20%
|
Expenses net of fee waivers, if any
|
1.11%
|
1.13%
|
1.13%
|
1.15%
|
1.20%
|
Expenses net of all reductions
|
1.10%
|
1.13%
|
1.12%
|
1.15%
|
1.20%
|
Net investment income (loss)
|
1.07%
F
|
.33%
|
(.23)%
|
.18%
|
1.27%
|
Supplemental Data
|
|
|
|
|
|
Net assets, end of period (in millions)
|
$ 1,490
|
$ 1,106
|
$ 1,426
|
$ 1,428
|
$ 1,343
|
Portfolio turnover rate
E
|
17%
|
30%
|
18%
|
22%
|
45%
|
A
Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
B
Total returns do not include the effect of the sales charges.
C
Calculated based on average shares outstanding during the period.
D
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.
E
Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
F
Investment income per share reflects a large, non-recurring dividend which amounted to $.10 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .84%.
G
The amounts shown reflect certain reclassifications related to book to tax differences that were made in the year shown.
H
Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage
service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
See accompanying notes which are an integral part of the financial statements.
Annual Report
Financial Highlights - Class T
Years ended July 31,
|
2013
|
2012
|
2011
|
2010
|
2009
|
Selected Per-Share Data
|
|
|
|
|
|
Net asset value, beginning of period
|
$ 33.60
|
$ 34.36
|
$ 28.05
|
$ 23.30
|
$ 35.91
|
Income from Investment Operations
|
|
|
|
|
|
Net investment income (loss)
C
|
.34
F
|
.03
|
(.15)
|
(.01)
|
.22
|
Net realized and unrealized gain (loss)
|
13.65
|
(.50
)
|
6.48
|
4.83
|
(12.73
)
|
Total from investment operations
|
13.99
|
(.47
)
|
6.33
|
4.82
|
(12.51
)
|
Distributions from net investment income
|
-
I
|
(.29)
|
-
G
|
(.06)
|
(.10)
|
Distributions from net realized gain
|
-
|
-
|
(.02
)
G
|
(.01
)
|
-
|
Total distributions
|
-
I
|
(.29
)
|
(.02
)
|
(.07
)
|
(.10
)
|
Net asset value, end of period
|
$ 47.59
|
$ 33.60
|
$ 34.36
|
$ 28.05
|
$ 23.30
|
Total Return
A,B
|
41.65%
|
(1.26)%
|
22.58%
|
20.72%
|
(34.71)%
|
Ratios to Average Net Assets
D,H
|
|
|
|
|
|
Expenses before reductions
|
1.34%
|
1.35%
|
1.35%
|
1.37%
|
1.42%
|
Expenses net of fee waivers, if any
|
1.34%
|
1.35%
|
1.35%
|
1.37%
|
1.42%
|
Expenses net of all reductions
|
1.33%
|
1.35%
|
1.35%
|
1.37%
|
1.42%
|
Net investment income (loss)
|
.85%
F
|
.11%
|
(.45)%
|
(.04)%
|
1.05%
|
Supplemental Data
|
|
|
|
|
|
Net assets, end of period (in millions)
|
$ 1,012
|
$ 753
|
$ 906
|
$ 867
|
$ 728
|
Portfolio turnover rate
E
|
17%
|
30%
|
18%
|
22%
|
45%
|
A
Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
B
Total returns do not include the effect of the sales charges.
C
Calculated based on average shares outstanding during the period.
D
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.
E
Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
F
Investment income per share reflects a large, non-recurring dividend which amounted to $.09 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .61%.
G
The amounts shown reflect certain reclassifications related to book to tax differences that were made in the year shown.
H
Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage
service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
I
Amount represents less than $.01 per share.
See accompanying notes which are an integral part of the financial statements.
Annual Report
Financial Highlights - Class B
Years ended July 31,
|
2013
|
2012
|
2011
|
2010
|
2009
|
Selected Per-Share Data
|
|
|
|
|
|
Net asset value, beginning of period
|
$ 32.38
|
$ 33.24
|
$ 27.27
|
$ 22.73
|
$ 35.10
|
Income from Investment Operations
|
|
|
|
|
|
Net investment income (loss)
C
|
.10
F
|
(.15)
|
(.33)
|
(.17)
|
.10
|
Net realized and unrealized gain (loss)
|
13.12
|
(.49
)
|
6.30
|
4.72
|
(12.43
)
|
Total from investment operations
|
13.22
|
(.64
)
|
5.97
|
4.55
|
(12.33
)
|
Distributions from net investment income
|
-
|
(.22)
|
-
|
-
|
(.04)
|
Distributions from net realized gain
|
-
|
-
|
-
|
(.01
)
|
-
|
Total distributions
|
-
|
(.22
)
|
-
|
(.01
)
|
(.04
)
|
Net asset value, end of period
|
$ 45.60
|
$ 32.38
|
$ 33.24
|
$ 27.27
|
$ 22.73
|
Total Return
A,B
|
40.83%
|
(1.85)%
|
21.89%
|
20.00%
|
(35.06)%
|
Ratios to Average Net Assets
D,G
|
|
|
|
|
|
Expenses before reductions
|
1.91%
|
1.94%
|
1.93%
|
1.96%
|
1.97%
|
Expenses net of fee waivers, if any
|
1.91%
|
1.94%
|
1.93%
|
1.96%
|
1.97%
|
Expenses net of all reductions
|
1.91%
|
1.93%
|
1.92%
|
1.96%
|
1.97%
|
Net investment income (loss)
|
.27%
F
|
(.48)%
|
(1.03)%
|
(.63)%
|
.49%
|
Supplemental Data
|
|
|
|
|
|
Net assets, end of period (in millions)
|
$ 80
|
$ 84
|
$ 121
|
$ 131
|
$ 128
|
Portfolio turnover rate
E
|
17%
|
30%
|
18%
|
22%
|
45%
|
A
Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
B
Total returns do not include the effect of the contingent deferred sales charge.
C
Calculated based on average shares outstanding during the period.
D
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.
E
Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
F
Investment income per share reflects a large, non-recurring dividend which amounted to $.09 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .04%.
G
Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage
service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
See accompanying notes which are an integral part of the financial statements.
Annual Report
Financial Highlights - Class C
Years ended July 31,
|
2013
|
2012
|
2011
|
2010
|
2009
|
Selected Per-Share Data
|
|
|
|
|
|
Net asset value, beginning of period
|
$ 32.40
|
$ 33.24
|
$ 27.26
|
$ 22.70
|
$ 35.05
|
Income from Investment Operations
|
|
|
|
|
|
Net investment income (loss)
C
|
.13
F
|
(.12)
|
(.31)
|
(.15)
|
.11
|
Net realized and unrealized gain (loss)
|
13.12
|
(.49
)
|
6.29
|
4.72
|
(12.42
)
|
Total from investment operations
|
13.25
|
(.61
)
|
5.98
|
4.57
|
(12.31
)
|
Distributions from net investment income
|
-
|
(.23)
|
-
|
-
H
|
(.04)
|
Distributions from net realized gain
|
-
|
-
|
-
|
(.01
)
|
-
|
Total distributions
|
-
|
(.23
)
|
-
|
(.01
)
|
(.04
)
|
Net asset value, end of period
|
$ 45.65
|
$ 32.40
|
$ 33.24
|
$ 27.26
|
$ 22.70
|
Total Return
A,B
|
40.90%
|
(1.76)%
|
21.94%
|
20.13%
|
(35.06)%
|
Ratios to Average Net Assets
D,G
|
|
|
|
|
|
Expenses before reductions
|
1.85%
|
1.87%
|
1.86%
|
1.89%
|
1.94%
|
Expenses net of fee waivers, if any
|
1.85%
|
1.87%
|
1.86%
|
1.89%
|
1.94%
|
Expenses net of all reductions
|
1.85%
|
1.86%
|
1.86%
|
1.89%
|
1.94%
|
Net investment income (loss)
|
.33%
F
|
(.41)%
|
(.97)%
|
(.56)%
|
.53%
|
Supplemental Data
|
|
|
|
|
|
Net assets, end of period (in millions)
|
$ 527
|
$ 405
|
$ 522
|
$ 525
|
$ 496
|
Portfolio turnover rate
E
|
17%
|
30%
|
18%
|
22%
|
45%
|
A
Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
B
Total returns do not include the effect of the contingent deferred sales charge.
C
Calculated based on average shares outstanding during the period.
D
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.
E
Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
F
Investment income per share reflects a large, non-recurring dividend which amounted to $.09 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .10%.
G
Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage
service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
H
Amount represents less than $.01 per share.
See accompanying notes which are an integral part of the financial statements.
Annual Report
Financial Highlights - Institutional Class
Years ended July 31,
|
2013
|
2012
|
2011
|
2010
|
2009
|
Selected Per-Share Data
|
|
|
|
|
|
Net asset value, beginning of period
|
$ 34.77
|
$ 35.44
|
$ 28.90
|
$ 23.97
|
$ 36.85
|
Income from Investment Operations
|
|
|
|
|
|
Net investment income (loss)
B
|
.57
E
|
.20
|
.02
|
.13
|
.33
|
Net realized and unrealized gain (loss)
|
14.13
|
(.52
)
|
6.67
|
4.96
|
(13.06
)
|
Total from investment operations
|
14.70
|
(.32
)
|
6.69
|
5.09
|
(12.73
)
|
Distributions from net investment income
|
(.08)
|
(.35)
|
(.05)
F
|
(.15)
|
(.15)
|
Distributions from net realized gain
|
-
|
-
|
(.10
)
F
|
(.01
)
|
-
|
Total distributions
|
(.08
)
|
(.35
)
|
(.15
)
|
(.16
)
|
(.15
)
|
Net asset value, end of period
|
$ 49.39
|
$ 34.77
|
$ 35.44
|
$ 28.90
|
$ 23.97
|
Total Return
A
|
42.34%
|
(.77)%
|
23.21%
|
21.30%
|
(34.38)%
|
Ratios to Average Net Assets
C,G
|
|
|
|
|
|
Expenses before reductions
|
.84%
|
.86%
|
.85%
|
.87%
|
.93%
|
Expenses net of fee waivers, if any
|
.84%
|
.86%
|
.85%
|
.87%
|
.93%
|
Expenses net of all reductions
|
.84%
|
.85%
|
.85%
|
.87%
|
.93%
|
Net investment income (loss)
|
1.34%
E
|
.60%
|
.04%
|
.46%
|
1.54%
|
Supplemental Data
|
|
|
|
|
|
Net assets, end of period (in millions)
|
$ 965
|
$ 631
|
$ 694
|
$ 710
|
$ 561
|
Portfolio turnover rate
D
|
17%
|
30%
|
18%
|
22%
|
45%
|
A
Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
B
Calculated based on average shares outstanding during the period.
C
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.
D
Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
E
Investment income per share reflects a large, non-recurring dividend which amounted to $.10 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 1.11%.
F
The amounts shown reflect certain reclassifications related to book to tax differences that were made in the year shown.
G
Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage
service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
See accompanying notes which are an integral part of the financial statements.
Annual Report
Notes
to
Financial Statements
For the period ended July 31, 2013
(Amounts in thousands except percentages)
1. Organization.
Fidelity Advisor Leveraged Company Stock Fund (the Fund) is a fund of Fidelity Advisor Series I (the Trust) and is authorized to issue an
unlimited number of shares. The Trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end
management investment company organized as a Massachusetts business trust. In June 2013, the Board of Trustees of the Fund approved the
creation of an additional class of shares. The Fund commenced sale of Class Z on August 13, 2013. The Fund offers Class A, Class T, Class C and
Institutional Class shares, each of which, along with Class B shares, has equal rights as to assets and voting privileges. Class B shares are
closed to new accounts and additional purchases, except for exchanges and reinvestments. Each class has exclusive voting rights with respect
to matters that affect that class. Class B shares will automatically convert to Class A shares after a holding period of seven years from the
initial date of purchase.
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 Fidelity Management & Research Company (FMR) and its affiliates. The Fund's Schedule of Investments lists
each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of
each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity
Central Funds.
The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of FMR.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission
(the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds, which are not covered by the Fund's
Report of Independent Registered Public Accounting Firm, 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:
Annual Report
Notes to Financial Statements - continued
(Amounts in thousands except percentages)
3. Significant Accounting Policies - continued
Investment Valuation.
Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. In accordance with
valuation policies and procedures approved by the Board of Trustees (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 FMR Fair Value Committee (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 is responsible for approving
and reporting to the Board all fair value determinations.
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 restricted equity
securities and private placements where observable inputs are limited, assumptions about market activity and risk are used and these securities are generally categorized as Level 3 in the hierarchy.
Annual Report
3. Significant Accounting Policies - continued
Investment Valuation - continued
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. For corporate bonds and floating rate loans, pricing vendors utilize matrix pricing which
considers yield or price of bonds of comparable quality, coupon, maturity and type as well as 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 July 31, 2013, 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
Annual Report
Notes to Financial Statements - continued
(Amounts in thousands except percentages)
3. Significant Accounting Policies - continued
Investment Transactions and Income - continued
ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Non-cash dividends included
in dividend income, if any, are recorded at the fair market value of the securities received. 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. Large, non-recurring dividends recognized by the Fund are presented separately on the Statement of Operations as "Special
Dividends" and the impact of these dividends is presented in the Financial Highlights. Interest income and distributions from the Fidelity
Central Funds are accrued as earned. Interest income includes coupon interest and amortization of premium and accretion of discount on
debt securities. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain. Debt obligations may
be placed on non-accrual status and related interest income may be reduced by ceasing current accruals and writing off interest receivables
when the collection of all or a portion of interest has become doubtful based on consistently applied procedures. A debt obligation is removed
from non-accrual status when the issuer resumes interest payments or when collectability of interest is reasonably assured.
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 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. 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 income taxes is required. As of July 31, 2013, the Fund did not have any unrecognized tax benefits in the financial statements;
nor is the Fund aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. A fund's
federal income tax returns are subject to examination by the
Annual Report
3. Significant Accounting Policies - continued
Income Tax Information and Distributions to Shareholders - continued
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. Temporary book-tax differences will reverse in a subsequent period.
Book-tax differences are primarily due to foreign currency transactions, market discount, equity-debt classifications, capital loss carryforwards 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
|
$ 1,310,830
|
Gross unrealized depreciation
|
(200,044
)
|
Net unrealized appreciation (depreciation) on securities and other investments
|
$ 1,110,786
|
|
|
Tax Cost
|
$ 3,042,191
|
The tax-based components of distributable earnings as of period end were as follows:
Undistributed ordinary income
|
$ 6,245
|
Capital loss carryforward
|
$ (358,992
)
|
Net unrealized appreciation (depreciation)
|
$ 1,110,786
|
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.
Annual Report
Notes to Financial Statements - continued
(Amounts in thousands except percentages)
3. Significant Accounting Policies - continued
Income Tax Information and Distributions to Shareholders - continued
The capital loss carryforward information presented below, including any applicable limitation, is estimated as of fiscal period end and is
subject to adjustment.
Fiscal year of expiration
|
|
2018
|
$ (358,992
)
|
The tax character of distributions paid was as follows:
|
July 31, 2013
|
July 31, 2012
|
Ordinary Income
|
$ 2,596
|
$ 28,865
|
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.
Loans and Other Direct Debt Instruments.
The Fund invests in direct debt instruments which are interests in amounts owed to lenders by
corporate or other borrowers. These instruments may be in the form of loans, trade claims or other receivables and may include standby
financing commitments such as revolving credit facilities that obligate the Fund to supply additional cash to the borrower on demand. Loans
may be acquired through assignment or participation, or may be made directly to a borrower. The Fund may be contractually obligated to
receive approval from the agent bank and/or borrower prior to the sale of these loans. The Fund did not have any unfunded loan commitments,
which are contractual obligations for future funding, at period end.
4. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities, aggregated $549,128 and $809,139, respectively.
5. Fees and Other Transactions with Affiliates.
Management Fee.
FMR and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly
management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .35% of the Fund's average
net assets and an annualized group fee rate that averaged .26% during the period. The group fee rate is based upon the average net assets of
all the
Annual Report
5. Fees and Other Transactions with Affiliates - continued
Management Fee - continued
mutual funds advised by FMR. The group fee rate decreases as assets under management increase and increases as assets under management
decrease. For the period, the total annual management fee rate was .61% of the Fund's average net assets.
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 FMR, separate Distribution and
Service Fees, each of which is based on an annual percentage of each class' average net assets. In addition, FDC may pay financial intermediaries for selling shares of the Fund and providing shareholder support services. For the period, the Distribution and Service Fee rates, total
fees and amounts retained by FDC were as follows:
|
Distribution
Fee
|
Service
Fee
|
Total Fees
|
Retained
by FDC
|
Class A
|
-%
|
.25%
|
$ 3,194
|
$ 157
|
Class T
|
.25%
|
.25%
|
4,347
|
47
|
Class B
|
.75%
|
.25%
|
831
|
631
|
Class C
|
.75%
|
.25%
|
4,554
|
540
|
|
|
|
$ 12,926
|
$ 1,375
|
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, Class B and Class C redemptions. The deferred sales charges range from 5.00% to 1.00% for
Class B shares, 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
|
$ 242
|
Class T
|
34
|
Class B
*
|
98
|
Class C
*
|
16
|
|
$ 390
|
*
When Class B and Class C shares are initially sold, FDC pays commissions from its own resources to financial intermediaries through which the sales are made.
Annual Report
Notes to Financial Statements - continued
(Amounts in thousands except percentages)
5. Fees and Other Transactions with Affiliates - continued
Transfer Agent Fees.
Fidelity Investments Institutional Operations Company, Inc., (FIIOC), an affiliate of FMR, is the transfer, dividend
disbursing and shareholder servicing agent for each class of the Fund. FIIOC receives account fees and asset-based fees that vary according to
the account size and type of account of the shareholders of the respective classes of the Fund. FIIOC pays for typesetting, printing and mailing
of shareholder reports, except proxy statements. For the period, transfer agent fees for each class were as follows:
|
Amount
|
% of
Average
Net Assets
|
Class A
|
$ 2,753
|
.22
|
Class T
|
1,678
|
.19
|
Class B
|
224
|
.27
|
Class C
|
949
|
.21
|
Institutional Class
|
1,492
|
.20
|
|
$ 7,096
|
|
Accounting and Security Lending Fees.
Fidelity Service Company, Inc. (FSC), an affiliate of FMR, maintains the Fund's accounting
records. The accounting fee is based on the level of average net assets for 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 $25 for the period.
6. Committed Line of Credit.
The Fund participates with other funds managed by FMR 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 and is reflected in Miscellaneous expenses on the Statement of Operations. During the period, there were no borrowings on this line of credit.
Annual Report
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. 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. At period end, there were no security loans outstanding with FCM. 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 $2,373, including $208 from securities
loaned to FCM.
8. Expense Reductions.
Commissions paid to certain brokers with whom FMR places trades on behalf of the Fund include an amount in addition to trade execution,
which is rebated back to the Fund to offset certain expenses. This amount totaled $134 for the period. In addition, through arrangements with
the Fund's custodian, credits realized as a result of uninvested cash balances were used to reduce the Fund's expenses. During the period,
these credits reduced the Fund's custody expenses by three hundred dollars.
9. Distributions to Shareholders.
Distributions to shareholders of each class were as follows:
Years ended July 31,
|
2013
|
2012
|
From net investment income
|
|
|
Class A
|
$ 1,121
|
$ 11,505
|
Class T
|
84
|
7,107
|
Class B
|
-
|
710
|
Class C
|
-
|
3,243
|
Institutional Class
|
1,391
|
6,300
|
Total
|
$ 2,596
|
$ 28,865
|
Annual Report
Notes to Financial Statements - continued
(Amounts in thousands except percentages)
10. Share Transactions.
Transactions for each class of shares were as follows:
|
Shares
|
Dollars
|
Years ended July 31,
|
2013
|
2012
|
2013
|
2012
|
Class A
|
|
|
|
|
Shares sold
|
7,818
|
6,791
|
$ 326,978
|
$ 220,746
|
Reinvestment of distributions
|
27
|
347
|
1,036
|
10,560
|
Shares redeemed
|
(9,447
)
|
(15,628
)
|
(384,545
)
|
(500,053
)
|
Net increase (decrease)
|
(1,602
)
|
(8,490
)
|
$ (56,531
)
|
$ (268,747
)
|
Class T
|
|
|
|
|
Shares sold
|
6,400
|
5,449
|
$ 261,455
|
$ 173,250
|
Reinvestment of distributions
|
2
|
222
|
79
|
6,629
|
Shares redeemed
|
(7,533
)
|
(9,652
)
|
(301,128
)
|
(304,171
)
|
Net increase (decrease)
|
(1,131
)
|
(3,981
)
|
$ (39,594
)
|
$ (124,292
)
|
Class B
|
|
|
|
|
Shares sold
|
34
|
32
|
$ 1,361
|
$ 953
|
Reinvestment of distributions
|
-
|
21
|
-
|
605
|
Shares redeemed
|
(874
)
|
(1,103
)
|
(33,817
)
|
(33,738
)
|
Net increase (decrease)
|
(840
)
|
(1,050
)
|
$ (32,456
)
|
$ (32,180
)
|
Class C
|
|
|
|
|
Shares sold
|
1,725
|
1,075
|
$ 69,238
|
$ 33,268
|
Reinvestment of distributions
|
-
|
88
|
-
|
2,548
|
Shares redeemed
|
(2,699
)
|
(4,363
)
|
(102,735
)
|
(132,599
)
|
Net increase (decrease)
|
(974
)
|
(3,200
)
|
$ (33,497
)
|
$ (96,783
)
|
Institutional Class
|
|
|
|
|
Shares sold
|
9,112
|
9,699
|
$ 385,989
|
$ 321,305
|
Reinvestment of distributions
|
29
|
165
|
1,155
|
5,095
|
Shares redeemed
|
(7,736
)
|
(11,315
)
|
(315,321
)
|
(367,381
)
|
Net increase (decrease)
|
1,405
|
(1,451
)
|
$ 71,823
|
$ (40,981
)
|
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.
Annual Report
To the Trustees of Fidelity Advisor Series I and the Shareholders of Fidelity Advisor Leveraged Company Stock Fund:
In our opinion, the accompanying statement of assets and liabilities, including the schedule of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of Fidelity Advisor
Leveraged Company Stock Fund (a fund of Fidelity Advisor Series I) at July 31, 2013, the results of its operations for the year then ended, the
changes in its net assets for each of the two years in the period then ended and the financial highlights for each of the five years in the period then
ended, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial
highlights (hereafter referred to as "financial statements") are the responsibility of the Fidelity Advisor Leveraged Company Stock Fund's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial
statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits,
which included confirmation of securities at July 31, 2013 by correspondence with the custodian, agent bank, and brokers, provide a reasonable
basis for our opinion.
PricewaterhouseCoopers LLP
Boston, Massachusetts
September 17, 2013
Annual Report
The Trustees, Member of the Advisory Board, and executive officers of the trust and fund, as applicable, are listed below. The Board of Trustees governs the fund and is responsible for protecting the interests of shareholders. The Trustees are experienced executives who meet
periodically throughout the year to oversee the fund's activities, review contractual arrangements with companies that provide services to the
fund, oversee management of the risks associated with such activities and contractual arrangements, and review the fund's performance.
Except for James C. Curvey, Ned C. Lautenbach, Ronald P. O'Hanley, and William S. Stavropoulos, each of the Trustees oversees 166 Fidelity
funds. Mr. Curvey oversees 387 Fidelity funds. Mr. Lautenbach, Mr. O'Hanley, and Mr. Stavropoulos each oversees 230 Fidelity funds.
The Trustees hold office without limit in time except that (a) any Trustee may resign; (b) any Trustee may be removed by written instrument,
signed by at least two-thirds of the number of Trustees prior to such removal; (c) any Trustee who requests to be retired or who has become
incapacitated by illness or injury may be retired by written instrument signed by a majority of the other Trustees; and (d) any Trustee may be
removed at any special meeting of shareholders by a two-thirds vote of the outstanding voting securities of the trust. Each Trustee who is not
an interested person of the trust and the fund (as defined in the 1940 Act) (Independent Trustee), shall retire not later than the last day of
the calendar year in which his or her 75th birthday occurs. The Independent Trustees may waive this mandatory retirement age policy with
respect to individual Trustees. The executive officers and Advisory Board Member hold office without limit in time, except that any officer and
Advisory Board Member may resign or may be removed by a vote of a majority of the Trustees at any regular meeting or any special meeting of
the Trustees. Except as indicated, each individual has held the office shown or other offices in the same company for the past five years.
Experience, Skills, Attributes, and Qualifications of the Fund's Trustees.
The Governance and Nominating Committee has adopted a
statement of policy that describes the experience, qualifications, attributes, and skills that are necessary and desirable for potential Independent Trustee candidates (Statement of Policy). The Board believes that each Trustee satisfied at the time he or she was initially elected or
appointed a Trustee, and continues to satisfy, the standards contemplated by the Statement of Policy. The Governance and Nominating
Committee also engages professional search firms to help identify potential Independent Trustee candidates who have the experience,
qualifications, attributes, and skills consistent with the Statement of Policy. From time to time, additional criteria based on the composition
and skills of the current Independent Trustees, as well as experience or skills that may be appropriate in light of future changes to board
composition, business conditions, and regulatory or other developments, have also been considered by the professional search firms and the
Governance and Nominating Committee. In addition, the Board takes into account the Trustees' commitment and participation in Board and
committee meetings, as well as their leadership of standing and ad hoc committees throughout their tenure.
Annual Report
In determining that a particular Trustee was and continues to be qualified to serve as a Trustee, the Board has considered a variety of criteria,
none of which, in isolation, was controlling. The Board believes that, collectively, the Trustees have balanced and diverse experience, qualifications, attributes, and skills, which allow the Board to operate effectively in governing the fund and protecting the interests of shareholders.
Information about the specific experience, skills, attributes, and qualifications of each Trustee, which in each case led to the Board's conclusion that the Trustee should serve (or continue to serve) as a trustee of the fund, is provided below.
Board Structure and Oversight Function.
James C. Curvey is an interested person (as defined in the 1940 Act) and currently serves as
Chairman. The Trustees have determined that an interested Chairman is appropriate and benefits shareholders because an interested
Chairman has a personal and professional stake in the quality and continuity of services provided to the fund. Independent Trustees exercise
their informed business judgment to appoint an individual of their choosing to serve as Chairman, regardless of whether the Trustee happens
to be independent or a member of management. The Independent Trustees have determined that they can act independently and effectively
without having an Independent Trustee serve as Chairman and that a key structural component for assuring that they are in a position to do so
is for the Independent Trustees to constitute a substantial majority for the Board. The Independent Trustees also regularly meet in executive
session. Ned C. Lautenbach serves as Chairman of the Independent Trustees and as such (i) acts as a liaison between the Independent
Trustees and management with respect to matters important to the Independent Trustees and (ii) with management prepares agendas for
Board meetings.
Fidelity funds are overseen by different Boards of Trustees. The fund's Board oversees Fidelity's equity and high income funds and another
Board oversees Fidelity's investment-grade bond, money market, and asset allocation funds. The asset allocation funds may invest in Fidelity
funds overseen by the fund's Board. The use of separate Boards, each with its own committee structure, allows the Trustees of each group of
Fidelity funds to focus on the unique issues of the funds they oversee, including common research, investment, and operational issues. On
occasion, the separate Boards establish joint committees to address issues of overlapping consequences for the Fidelity funds overseen by
each Board.
The Trustees operate using a system of committees to facilitate the timely and efficient consideration of all matters of importance to the
Trustees, the fund, and fund shareholders and to facilitate compliance with legal and regulatory requirements and oversight of the fund's
activities and associated risks. The Board, acting through its committees, has charged FMR and its affiliates with (i) identifying events or
circumstances the occurrence of which could have demonstrably adverse effects on the fund's business and/or reputation; (ii) implementing
processes and controls to lessen the possibility that such events or circumstances occur or to mitigate the effects of such events or circumstances if they do occur; and (iii) creating and maintaining a system designed to evaluate continuously business and market conditions in
order to facilitate the identification and implementation processes described in (i) and (ii) above. Because the day-to-day operations and
activities of the fund are carried out by or through FMR, its affiliates and other service providers, the fund's exposure to risks is mitigated but
not eliminated by the processes overseen by the Trustees. While each of the Board's committees has responsibility for overseeing different
aspects of the fund's activities, oversight is exercised primarily through the Operations, Audit, and Compliance Committees. In addition, the
Independent Trustees have worked with FMR to enhance the Board's oversight of investment and financial risks, legal and regulatory risks,
technology risks, and operational risks, including the development of additional risk reporting to the Board. For example, a working group
comprised of Independent Trustees and FMR has worked and continues to work to review the Fidelity funds' valuation-related activities,
reporting and risk management. Appropriate personnel, including but not limited to the fund's Chief Compliance Officer (CCO), FMR's
internal auditor, the independent accountants, the fund's Treasurer and portfolio management personnel, make periodic reports to the
Board's committees, as appropriate, including an annual review of FMR's risk management program for the Fidelity funds. The responsibilities of each standing committee, including their oversight responsibilities, are described further under "Standing Committees of the Fund's
Trustees."
Annual Report
Trustees and Officers - continued
The fund's Statement of Additional Information (SAI) includes more information about the Trustees. To request a free copy, call Fidelity at
1-877-208-0098.
Interested Trustees
*:
Correspondence intended for each Trustee who is an interested person may be sent to Fidelity Investments, 245 Summer Street, Boston,
Massachusetts 02210.
Name, Year of Birth; Principal Occupations and Other Relevant Experience
+
|
James C. Curvey (1935)
|
|
Year of Election or Appointment: 2007
Mr. Curvey is Trustee and Chairman of the Board of Trustees of certain Trusts. Mr. Curvey also serves as Trustee
(2007-present) of other investment companies advised by FMR. Mr. Curvey is a Director of Fidelity Investments Money
Management, Inc. (2009-present), Director of Fidelity Research & Analysis Co. (2009-present) and Director of FMR and
FMR Co., Inc. (2007-present). Mr. Curvey is also Vice Chairman (2007-present) and Director of FMR LLC. In addition,
Mr. Curvey serves as an Overseer for the Boston Symphony Orchestra and a member of the Trustees of Villanova
University. Previously, Mr. Curvey was the Vice Chairman (2006-2007) and Director (2000-2007) of FMR Corp.
|
Ronald P. O'Hanley (1957)
|
|
Year of Election or Appointment: 2011
Mr. O'Hanley serves as a Trustee and Chairman of the Board of Trustees of other Fidelity funds (2013-present), and is
Director of FMR Co., Inc. (2010-present), Director of Fidelity Investments Money Management, Inc. (2010-present),
Director of Fidelity Research & Analysis Company (2010-present), President of Fidelity Asset Management and
Corporate Services and a Member of Fidelity's Executive Committee (2010-present). Previously, Mr. O'Hanley served as President and Chief Executive Officer of BNY Mellon Asset Management
(2007-2010). Mr. O'Hanley also served as Vice Chairman of Bank New York Mellon Corp. and a member of that firm's
Executive Committee. Prior to the 2007 merger of The Bank of New York and Mellon Financial Corporation, he was
Vice Chairman of Mellon Financial Corporation and President and Chief Executive Officer of Mellon Asset
Management. He joined Mellon in February 1997. Mr. O'Hanley currently serves as Chairman of the Boston Public
Library Foundation Board of Directors and sits on the Board of Directors of Beth Israel Deaconess Medical Center, the
Board of Trustees of the Marine Biological Laboratory and the Advisory Board of the Maxwell School of Citizenship and
Public Administration at Syracuse University. Mr. O'Hanley also chairs the Council on Asset Management for the
Financial Services Roundtable and is a member of the Board of Directors of Institutional Investor's U.S. Institute.
|
* Trustees have been determined to be "Interested Trustees" by virtue of, among other things, their affiliation with the trust or various
entities under common control with FMR.
+
The information above includes each Trustee's principal occupation during the last five years and other information relating to the experience, attributes, and skills relevant to each Trustee's qualifications to serve as a Trustee, which led to the conclusion that each
Trustee should serve as a Trustee for the fund.
Annual Report
Trustees and Officers - continued
Independent Trustees
:
Correspondence intended for each Independent Trustee (that is, the Trustees other than the Interested Trustees) may be sent to Fidelity
Investments, P.O. Box 55235, Boston, Massachusetts 02205-5235.
Name, Year of Birth; Principal Occupations and Other Relevant Experience
+
|
Dennis J. Dirks (1948)
|
|
Year of Election or Appointment: 2005
Prior to his retirement in May 2003, Mr. Dirks was Chief Operating Officer and a member of the Board of The
Depository Trust & Clearing Corporation (DTCC). He also served as President, Chief Operating Officer, and Board
member of The Depository Trust Company (DTC) and President and Board member of the National Securities Clearing
Corporation (NSCC). In addition, Mr. Dirks served as Chief Executive Officer and Board member of the Government
Securities Clearing Corporation, Chief Executive Officer and Board member of the Mortgage-Backed Securities Clearing
Corporation, as a Trustee and a member of the Finance Committee of Manhattan College (2005-2008), and as a
Trustee and a member of the Finance Committee of AHRC of Nassau County (2006-2008). Mr. Dirks is a member of the
Independent Directors Council (IDC) Governing Council (2010-present) and Board of Directors for The Brookville Center
for Children's Services, Inc. (2009-present).
|
Alan J. Lacy (1953)
|
|
Year of Election or Appointment: 2008
Mr. Lacy serves as Senior Adviser (2007-present) of Oak Hill Capital Partners, L.P. (private equity). Mr. Lacy also served
as Chief Executive Officer (2000-2005) and Vice Chairman (2005-2006) of Sears Holdings Corporation and Sears,
Roebuck and Co. (retail). In addition, Mr. Lacy serves as a member of the Board of Directors of Dave & Buster's
Entertainment, Inc. (restaurant and entertainment complexes, 2010-present), Earth Fare, Inc. (retail grocery, 2012-present), The Hillman Companies, Inc. (hardware wholesalers,
2010-present), and Bristol-Myers Squibb Company (global pharmaceuticals, 2008-present). Mr. Lacy is a member of
the Board of Trustees of The National Parks Conservation Association (2006-present). Previously, Mr. Lacy served as
Chairman of the Board of Trustees of the National Parks Conservation Association (2008-2011) and as a member of the
Board of Directors for the Western Union Company (global money transfer, 2006-2011).
|
Ned C. Lautenbach (1944)
|
|
Year of Election or Appointment: 2000
Mr. Lautenbach is Chairman of the Independent Trustees of the Equity and High Income Funds (2006-present) and
serves as a Trustee of other Fidelity funds (2013-present). Mr. Lautenbach currently serves as the Lead Director of the
Eaton Corporation Board of Directors (diversified industrial, 1997-present). Mr. Lautenbach is Chairman of the Board of
Directors of the Philharmonic Center for the Arts in Naples, Florida (2012-present) and a member of the Council on
Foreign Relations (1994-present). Previously, Mr. Lautenbach was a Partner/Advisory Partner at Clayton, Dubilier &
Rice, LLC (private equity investment, 1998-2010), as well as a Director of Sony Corporation (2006-2007).
|
Joseph Mauriello (1944)
|
|
Year of Election or Appointment: 2008
Prior to his retirement in January 2006, Mr. Mauriello served in numerous senior management positions including
Deputy Chairman and Chief Operating Officer (2004-2005), and Vice Chairman of Financial Services (2002-2004) of
KPMG LLP US (professional services, 1965-2005). Mr. Mauriello currently serves as a member of the Board of Directors
of XL Group plc. (global insurance and re-insurance, 2006-present). Previously, Mr. Mauriello served as a Director of
the Hamilton Funds of the Bank of New York (2006-2007) and of Arcadia Resources Inc. (health care services and
products, 2007-2012).
|
Robert W. Selander (1950)
|
|
Year of Election or Appointment: 2011
Previously, Mr. Selander served as a Member of the Advisory Board of Fidelity's Equity and High Income Funds (2011),
Executive Vice Chairman (2010), Chief Executive Officer (2009-2010), and President and Chief Executive Officer
(1997-2009) of Mastercard, Inc.
|
Cornelia M. Small (1944)
|
|
Year of Election or Appointment: 2005
Ms. Small is a member of the Board of Directors (2009-present) and Chair of the Investment Committee (2010-present)
of the Teagle Foundation. Ms. Small also serves on the Investment Committee of the Berkshire Taconic Community
Foundation (2008-present). Previously, Ms. Small served as Chairperson (2002-2008) and a member of the Investment
Committee and Chairperson (2008-2012) and a member of the Board of Trustees of Smith College. In addition, Ms.
Small served as Chief Investment Officer, Director of Global Equity Investments, and a member of the Board of Directors
of Scudder, Stevens & Clark and Scudder Kemper Investments.
|
William S. Stavropoulos (1939)
|
|
Year of Election or Appointment: 2002
Mr. Stavropoulos is Vice Chairman of the Independent Trustees of the Equity and High Income Funds (2006-present) and
serves as a Trustee of other Fidelity funds (2013-present). Mr. Stavropoulos serves as President and Founder of the
Michigan Baseball Foundation, the Great Lakes Loons (2007-present). Mr. Stavropoulos is Chairman Emeritus of the
Board of Directors of The Dow Chemical Company, where he previously served in numerous senior management
positions, including President, CEO (1995-2000; 2002-2004), Chairman of the Executive Committee (2000-2006), and
as a member of the Board of Directors (1990-2006). Currently, Mr. Stavropoulos is Chairman of the Board of Directors
of Univar Inc. (global distributor of commodity and specialty chemicals), a Director of Teradata Corporation (data
warehousing and technology solutions), and Maersk Inc. (industrial conglomerate), and a member of the Advisory
Board for Metalmark Capital LLC (private equity investment, 2005-present). Mr. Stavropoulos is an operating advisor to
Clayton, Dubilier & Rice, LLC (private equity investment). In addition, Mr. Stavropoulos is a member of the University of
Notre Dame Advisory Council for the College of Science, a Trustee of the Rollin L. Gerstacker Foundation, and a
Director of the Naples Philharmonic Center for the Arts. Previously, Mr. Stavropoulos served as a Director of Chemical
Financial Corporation (bank holding company, 1993-2012) and Tyco International, Ltd. (multinational manufacturing
and services, 2007-2012).
|
David M. Thomas (1949)
|
|
Year of Election or Appointment: 2008
Previously, Mr. Thomas served as Executive Chairman (2005-2006) and Chairman and Chief Executive Officer
(2000-2005) of IMS Health, Inc. (pharmaceutical and healthcare information solutions), and a Director of Fortune
Brands, Inc. (consumer products, 2000-2011). In addition, Mr. Thomas serves as Non-Executive Chairman of the Board
of Directors of Fortune Brands Home and Security (home and security products, 2011-present), and as a member of the Board of Directors of Interpublic Group of Companies, Inc. (marketing
communication, 2004-present).
|
+
The information above includes each Trustee's principal occupation during the last five years and other information relating to the experience, attributes, and skills relevant to each Trustee's qualifications to serve as a Trustee, which led to the conclusion that each
Trustee should serve as a Trustee for the fund.
Annual Report
Advisory Board Member and Executive Officers
:
Correspondence intended for each executive officer and Peter S. Lynch may be sent to Fidelity Investments, 245 Summer Street, Boston,
Massachusetts 02210.
Name, Year of Birth; Principal Occupation
|
Peter S. Lynch (1944)
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|
Year of Election or Appointment: 2003
Member of the Advisory Board of Fidelity's Equity and High Income Funds. Mr. Lynch is Vice Chairman and a Director
of FMR and FMR Co., Inc. In addition, Mr. Lynch serves as a Trustee of Boston College and as the Chairman of the
Inner-City Scholarship Fund. Previously, Mr. Lynch served on the Special Olympics International Board of Directors
(1997-2006).
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Kenneth B. Robins (1969)
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Year of Election or Appointment: 2008
President and Treasurer of Fidelity's Equity and High Income Funds. Mr. Robins also serves as President and Treasurer
(2008-present) and Assistant Treasurer (2009-present) of other Fidelity funds and is an employee of Fidelity Investments
(2004-present). Mr. Robins serves as Executive Vice President of Fidelity Investments Money Management, Inc. (FIMM)
(2013-present). Previously, Mr. Robins served as Deputy Treasurer of the Fidelity funds (2005-2008) and Treasurer and
Chief Financial Officer of The North Carolina Capital Management Trust: Cash and Term Portfolios (2006-2008).
|
Bruce T. Herring (1965)
|
|
Year of Election or Appointment: 2006
Vice President of certain Equity Funds. Mr. Herring also serves as Vice President of other Fidelity funds (2013-present),
Chief Investment Officer of Fidelity Global Asset Allocation (GAA) (2013-present), Chief Investment Officer and Director
of Fidelity Management & Research (U.K.) Inc. (2010-present), Group Chief Investment Officer of FMR, and President of
Fidelity Research & Analysis Company (2010-present). Previously, Mr. Herring served as Vice President (2005-2006)
and Senior Vice President (2006-2007) of Fidelity Management & Research Company, Vice President of FMR Co., Inc.
(2001-2007) and as a portfolio manager for Fidelity U.S. Equity Funds.
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Brian B. Hogan (1964)
|
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Year of Election or Appointment: 2009
Vice President of Equity and High Income Funds. Mr. Hogan also serves as Vice President of other Fidelity funds
(2009-present) and President of FMR's Equity Division (2009-present). Previously, Mr. Hogan served as Senior Vice
President, Equity Research of FMR (2006-2009) and as a portfolio manager.
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Scott C. Goebel (1968)
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Year of Election or Appointment: 2008
Secretary and Chief Legal Officer (CLO) of the Fidelity funds. Mr. Goebel also serves as Secretary of Fidelity Investments
Money Management, Inc. (FIMM) (2010-present) and Fidelity Research and Analysis Company (FRAC) (2010-present);
Secretary and CLO of The North Carolina Capital Management Trust: Cash and Term Portfolios (2008-present); General Counsel, Secretary, and Senior Vice President of FMR (2008-present) and FMR Co., Inc.
(2008-present); employed by FMR LLC or an affiliate (2001-present); Chief Legal Officer of Fidelity Management &
Research (Hong Kong) Limited (2008-present) and Assistant Secretary of Fidelity Management & Research (Japan) Inc.
(2008-present), and Fidelity Management & Research (U.K.) Inc. (2008-present). Previously, Mr. Goebel served as Assistant Secretary of FIMM (2008-2010), FRAC (2008-2010), and the
Funds (2007-2008) and as Vice President and Secretary of Fidelity Distributors Corporation (FDC) (2005-2007).
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William C. Coffey (1969)
|
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Year of Election or Appointment: 2009
Assistant Secretary of Fidelity's Equity and High Income Funds. Mr. Coffey also serves as Assistant Secretary of other
Fidelity funds (2009-present), Senior Vice President and Deputy General Counsel of FMR LLC (2010-present), and is an
employee of Fidelity Investments. Previously, Mr. Coffey served as Vice President and Associate General Counsel of FMR
LLC (2005-2009).
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Elizabeth Paige Baumann (1968)
|
|
Year of Election or Appointment: 2012
Anti-Money Laundering (AML) Officer of the Fidelity funds. Ms. Baumann also serves as AML Officer of The North
Carolina Capital Management Trust: Cash and Term Portfolios (2012-present), Chief AML Officer of FMR LLC
(2012-present), and is an employee of Fidelity Investments. Previously, Ms. Baumann served as Vice President and
Deputy Anti-Money Laundering Officer (2007-2012).
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Christine Reynolds (1958)
|
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Year of Election or Appointment: 2008
Chief Financial Officer of the Fidelity funds. Ms. Reynolds became President of Fidelity Pricing and Cash Management
Services (FPCMS) in August 2008. Ms. Reynolds served as Chief Operating Officer of FPCMS (2007-2008). Previously,
Ms. Reynolds served as President, Treasurer, and Anti-Money Laundering officer of the Fidelity funds (2004-2007).
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Joseph A. Hanlon (1968)
|
|
Year of Election or Appointment: 2012
Chief Compliance Officer of Fidelity's Equity and High Income Funds. Mr. Hanlon also serves as Chief Compliance
Officer of other Fidelity funds (2012-present). Mr. Hanlon serves as Compliance Officer of FMR, FMR Co., Inc., Fidelity
Investments Money Management, Inc. (FIMM), Fidelity Research and Analysis Company (FRAC), and Fidelity
Management & Research (Hong Kong) (2009-present), as Senior Vice President of the Fidelity Asset Management
Division (2009-present), and is an employee of Fidelity Investments. Previously, Mr. Hanlon served as Compliance
Officer of Fidelity Management & Research (Japan) Inc. (2009-2013), Strategic Advisers, Inc. (2009-2013), and
Fidelity Management & Research (U.K.) Inc. (2009-2013).
|
Joseph F. Zambello (1957)
|
|
Year of Election or Appointment: 2011
Deputy Treasurer of the Fidelity funds. Mr. Zambello is an employee of Fidelity Investments. Previously, Mr. Zambello
served as Vice President of FMR's Program Management Group (2009-2011) and Vice President of the Transfer Agent Oversight Group
(2005-2009).
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Adrien E. Deberghes (1967)
|
|
Year of Election or Appointment: 2008
Deputy Treasurer of Fidelity's Equity and High Income Funds. Mr. Deberghes also serves as Vice President
(2011-present), Deputy Treasurer (2008-present), and Assistant Treasurer (2010-present) of other Fidelity funds, and is
an employee of Fidelity Investments (2008-present). Previously, Mr. Deberghes served as Senior Vice President of Mutual Fund Administration at State Street
Corporation (2007-2008), Senior Director of Mutual Fund Administration at Investors Bank & Trust (2005-2007), and
Director of Finance for Dunkin' Brands (2000-2005).
|
Stephen Sadoski (1971)
|
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Year of Election or Appointment: 2012
Deputy Treasurer of Fidelity's Equity and High Income Funds. Mr. Sadoski also serves as Deputy Treasurer of other
Fidelity funds (2012-present) and is an employee of Fidelity Investments (2012-present). Previously, Mr. Sadoski served as Assistant Treasurer
of Fidelity's Fixed Income and Asset Allocation Funds (2012-2013), an assistant chief accountant in the Division of
Investment Management of the Securities and Exchange Commission (SEC) (2009-2012) and as a senior manager at
Deloitte & Touche LLP (1997-2009).
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Stacie M. Smith (1974)
|
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Year of Election or Appointment: 2013
Deputy Treasurer of Fidelity's Equity and High Income Funds. Ms. Smith also serves as Deputy Treasurer of other Fidelity
funds (2013-present) and is an employee of Fidelity Investments (2009-present). Previously, Ms. Smith served as Senior
Audit Manager of Ernst & Young LLP (1996-2009).
|
Stephanie J. Dorsey (1969)
|
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Year of Election or Appointment: 2010
Assistant Treasurer of Fidelity's Equity and High Income Funds. Ms. Dorsey also serves as President and Treasurer
(2013-present) and Assistant Treasurer (2010-present) of other Fidelity funds, Treasurer and Chief Financial Officer of
The North Carolina Capital Management Trust: Cash and Term Portfolios (2013-present), and is an employee of Fidelity
Investments (2008-present). Previously, Ms. Dorsey served as Deputy Treasurer of Fidelity's Fixed Income and Asset
Allocation Funds (2008-2013), Treasurer (2004-2008) of the JPMorgan Mutual Funds and Vice President (2004-2008) of JPMorgan Chase
Bank.
|
Gary W. Ryan (1958)
|
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Year of Election or Appointment: 2005
Assistant Treasurer of the Fidelity funds. Mr. Ryan is an employee of Fidelity Investments. Previously, Mr. Ryan served as
Vice President of Fund Reporting in Fidelity Pricing and Cash Management Services (FPCMS) (1999-2005).
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Jonathan Davis (1968)
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Year of Election or Appointment: 2010
Assistant Treasurer of the Fidelity funds. Mr. Davis is also Assistant Treasurer of Fidelity Rutland Square Trust II and
Fidelity Commonwealth Trust II. Mr. Davis is an employee of Fidelity Investments. Previously, Mr. Davis served as Vice
President and Associate General Counsel of FMR LLC (2003-2010).
|
Annual Report
Class A, and Class T designate 100% of the dividends distributed during the fiscal year as qualifying for the dividends-received deduction for
corporate shareholders.
Class A, and Class T designate 100% of the dividends distributed during the fiscal year as amounts which can be taken into account as a
dividend for the purposes of the maximum rate under section 1(h)(11) of the Internal Revenue Code.
The fund will notify shareholders in January 2014 of amounts for use in preparing 2013 income tax returns.
Annual Report
Board
Approval
of Investment Advisory Contracts and Management Fees
Fidelity Advisor Leveraged Company Stock Fund
Each year, the Board of Trustees, including the Independent Trustees (together, the Board), votes on the renewal of the management contract and 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, 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 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 the Fidelity funds.
At its July 2013 meeting, the Board, including the Independent Trustees, 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 relationship with the fund; (iv) the extent to which economies of scale exist and would be realized as the fund
grows; and (v) whether fee levels reflect these economies of scale, if any, for the benefit of 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 in the fund have a broad range of investment choices available to them, including a wide choice
among mutual 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 a part of the Fidelity
family of funds.
Annual Report
Nature, Extent, and Quality of Services Provided.
The Board considered the staffing within the investment adviser, Fidelity Management & Research Company (FMR), and the sub-advisers (together, the Investment Advisers) as it relates to the fund, including the backgrounds of the fund's investment personnel, 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 portfolio manager compensation program and whether this structure provides appropriate incentives
to act in the best interests of the fund.
Resources Dedicated to Investment Management and Support Services
. The Board and the Fund Oversight and Research Committees reviewed the general qualifications and capabilities of the Investment Advisers' investment staff, including its size, education, experience, and
resources, as well as the Investment Advisers' approach to recruiting, training, managing, and compensating investment personnel. The
Board noted that FMR 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 believes
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 the Investment Advisers' trading and risk management capabilities and resources, which are an integral part 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 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 and subcustodians; 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.
Annual Report
Board Approval of Investment Advisory Contracts and
Management Fees - continued
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.
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) persisting in efforts to enhance Fidelity's
global research capabilities; (iii) launching new funds and making other enhancements to meet client needs for global and income-oriented
solutions; (iv) 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; (v) rationalizing product lines and gaining
increased efficiencies through the mergers of several funds into other funds; (vi) strengthening Fidelity's index fund offerings by reducing
investment minimums and adopting or lowering existing expense caps for certain funds and classes; (vii) enhancing Global Asset Allocation
product offerings by launching new funds and strategies, including "open architecture" target date funds that utilize affiliated and unaffiliated sub-advisers; (viii) modifying the eligibility criteria for Institutional Class shares of Advisor funds to increase their marketability to a
portion of the defined contribution plan market; (ix) creating a new low-cost retirement share class for certain Advisor funds to appeal to
large retirement plans; (x) transitioning the management of certain Fidelity commodity funds to Geode Capital Management LLC, a registered commodity pool operator, while retaining administrative responsibilities for the funds; (xi) reorganizing a number of funds; and (xii)
taking steps toward establishing a new Fidelity adviser to manage sector-based funds and products.
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 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 periodically considers annualized return information for the fund, for different time periods, measured against
a
securities market index ("benchmark index") and a peer group of mutual funds with similar objectives ("peer group"). 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 the Investment Advisers' explanations for any overperformance or underperformance.
Annual Report
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 classes, where applicable, compared to appropriate benchmark indices, over appropriate time periods which 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; tactical opportunities for investment;
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 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) and 75th percentile (bottom of
box) of the peer universe.
Annual Report
Board Approval of Investment Advisory Contracts and
Management Fees - continued
Fidelity Advisor Leveraged Company Stock Fund
Based on its review, the Board concluded that the nature, extent, and quality of services provided to the fund under the Advisory Contracts
should benefit the fund's shareholders.
Competitiveness of Management Fee and Total Expense Ratio.
The Board considered the fund's management fee and total expense
ratio compared to "mapped groups" of competitive funds and classes. Fidelity creates "mapped groups" by combining similar Lipper investment objective categories that have comparable management fee characteristics. Combining Lipper investment objective categories aids the
Board's management fee and total expense ratio comparisons by broadening the competitive group used for comparison and by reducing the
number of universes to which various Fidelity funds are compared.
Management Fee
. The Board considered two proprietary management fee comparisons for the 12-month periods shown in the chart below.
The group of Lipper funds used by the Board for management fee comparisons is referred to below as the "Total Mapped Group." The Total
Mapped Group comparison focuses on a fund's standing in terms of gross management fees before expense reimbursements or caps relative to
the total universe of funds with comparable investment mandates, regardless of whether their management fee structures also are comparable. Funds with comparable investment mandates offer exposure to similar types of securities. Funds with comparable management fee
structures have similar management fee contractual arrangements (
e.g.
, flat rate charged for advisory services, all-inclusive fee rate,
etc.
).
"TMG %" represents the percentage of funds in the Total Mapped Group that had management fees that were lower than the fund's. For
example, a TMG % of 18% means that 82% of the funds in the Total Mapped Group had higher management fees than the fund. The "Asset-Size
Peer Group" (ASPG) comparison focuses on a fund's standing relative to a subset of non-Fidelity funds within the Total Mapped Group that
are similar in size and management fee structure. The ASPG represents at least 15% of the funds in the Total Mapped Group with comparable
asset size and management fee structures, subject to a minimum of 50 funds (or all funds in the Total Mapped Group if fewer than 50). Additional information, such as the ASPG quartile in which the fund's management fee ranked, is also included in the chart and considered by the
Board.
Annual Report
Fidelity Advisor Leveraged Company Stock Fund
The Board noted that the fund's management fee ranked below the median of its Total Mapped Group and below the median of its ASPG for
2012.
Based on its review, the Board concluded that the fund's management fee is fair and reasonable in light of the services that the fund receives
and the other factors considered.
Total Expense Ratio
. In its review of each class's total expense ratio, the Board considered the fund's management fee as well as other fund or
class expenses, as applicable, such as transfer agent fees, pricing and bookkeeping fees, fund-paid 12b-1 fees, and custodial, legal, and audit
fees. The Board also noted the effects of any waivers and reimbursements on fees and expenses. As part of its review, the Board also considered the current and historical total expense ratios of each class of the fund compared to competitive fund median expenses. Each class of the
fund is compared to those funds and classes in the Total Mapped Group (used by the Board for management fee comparisons) that have a
similar sales load structure.
Annual Report
Board Approval of Investment Advisory Contracts and
Management Fees - continued
The Board noted that the total expense ratio of each of Class A, Class B, Class C, and Institutional Class ranked below its competitive median
for 2012 and the total expense ratio of Class T ranked above its competitive median for 2012. The Board considered that, in general, various
factors can affect total expense ratios. The Board noted that the total expense ratio of Class T was above the competitive median primarily
because of higher 12b-1 fees on Class T. Class T has a higher 12b-1 fee, but a lower front-end sales charge, than traditionally priced front-end
sales charge classes. The Board considered that Class T is primarily sold load-waived in the retirement plan market where its 0.50% 12b-1 fee
is comparable to competing no-load, higher 12b-1 fee classes designed specifically for retirement plans. The Board noted that the fund offers
multiple classes, each of which has a different sales load and 12b-1 fee structure, and that the multiple structures are intended to offer a
range of pricing options for the intermediary market. The Board also noted that the total expense ratios of the classes vary primarily by the
level of their 12b-1 fees, although differences in transfer agent fees may also cause expenses to vary from class to class.
Fees Charged to Other Fidelity Clients
. The Board also considered Fidelity fee structures and other information with respect to clients of FMR
and its affiliates, such as other mutual funds advised or subadvised by FMR or its affiliates, pension plan clients, and other institutional
clients. The Board noted the findings of the 2013 ad hoc joint committee (created with the board of other Fidelity funds), which reviewed and
compared Fidelity's institutional investment advisory business with its business of providing services to the Fidelity funds, including the
differences in services provided, fees charged, and costs incurred, as well as competition in their respective marketplaces.
Based on its review of total expense ratios and fees charged to other Fidelity clients, the Board concluded that the total expense ratio of each
class of the fund was reasonable, although Class T was above the median of the universe presented for comparison, in light of the services that
the fund and its shareholders receive and the other factors considered.
Costs of the Services and Profitability.
The Board considered the revenues earned and the expenses incurred by Fidelity in conducting the
business of developing, marketing, distributing, managing, administering and servicing the fund and servicing the fund's shareholders. The
Board also considered the level of Fidelity's profits in respect of all the Fidelity funds.
On an annual basis, FMR presents to the Board Fidelity's profitability for the fund. Fidelity calculates the profitability for each fund, as well as
aggregate profitability for groups of Fidelity funds and all Fidelity funds, using a series of detailed revenue and cost allocation methodologies
which originate with the books and records of Fidelity on which Fidelity's audited financial statements are based. The Audit Committee of the
Board reviews any significant changes from the prior year's methodologies.
Annual Report
PricewaterhouseCoopers LLP (PwC), independent registered public accounting firm and auditor to Fidelity and certain Fidelity funds, has
been engaged annually by the Board as part of the Board's assessment of Fidelity's profitability analysis. PwC's engagement includes the
review and assessment of the methodologies used by Fidelity in determining the revenues and expenses attributable to Fidelity's mutual fund
business, and completion of agreed-upon procedures surrounding the mathematical accuracy of fund profitability and its conformity to
allocation methodologies. After considering PwC's reports issued under the engagement and information provided by Fidelity, the Board
concluded that while other allocation methods may also be reasonable, Fidelity's profitability methodologies are reasonable in all material
respects.
The Board also reviewed Fidelity's non-fund businesses and fall-out benefits related to the mutual fund business as well as cases where
Fidelity's affiliates may benefit from or be related to the fund's business.
The Board considered the costs of the services provided by and the profits realized by Fidelity in connection with the operation of the fund and
was satisfied that the profitability was not excessive in the circumstances.
Economies of Scale.
The Board considered whether there have been economies of scale in respect of the management of the Fidelity funds,
whether the Fidelity funds (including the fund) have appropriately benefited from any such economies of scale, and whether there is potential for realization of any further economies of scale. The Board considered the extent to which the fund will benefit from economies of scale
through increased services to the fund, through waivers or reimbursements, or through fee or expense reductions. The Board also noted that
in 2009, it and the board of other Fidelity funds created an ad hoc committee (the Economies of Scale Committee) to analyze whether FMR
attains economies of scale in respect of the management and servicing of the Fidelity funds, whether the Fidelity funds have appropriately
benefited from such economies of scale, and whether there is potential for realization of any further economies of scale.
The Board recognized that the fund's management contract incorporates a "group fee" structure, which provides for lower group fee rates as
total fund assets under FMR's management increase, and for higher group fee rates as total fund assets under FMR's management decrease.
FMR calculates the group fee rates based on a tiered asset "breakpoint" schedule that varies based on asset class. The Board considered that
the group fee is designed to deliver the benefits of economies of scale to fund shareholders when total Fidelity fund assets increase, even if
assets of any particular fund are unchanged or have declined, because some portion of Fidelity's costs are attributable to services provided to
all Fidelity funds, and all funds benefit if those costs can be allocated among more assets. The Board concluded that, given the group fee
structure, fund shareholders will benefit from lower management fees as assets under FMR's management increase at the fund complex level,
regardless of whether Fidelity achieves any such economies of scale.
Annual Report
Board Approval of Investment Advisory Contracts and
Management Fees - continued
The Board concluded, taking into account the analysis of the Economies of Scale Committee, that economies of scale, if any, are being appropriately shared between fund shareholders and Fidelity.
Amendment to Description of Group Fee Rate
. At its July 2013 meeting, the Board voted to approve an amendment to the fund's management
contract to modify the description of the "group fee rate" effective August 1, 2013. The Board noted that under the prior description in the
contract, the group fee rate was based on the average net assets of all registered investment companies with which FMR has management
contracts. Under the contract's tiered asset breakpoint schedule, the group fee rate is lower as total fund assets under FMR's management
increase, and higher as total fund assets under FMR's management decrease. The Board considered that the prior description would have
excluded the assets of 64 Fidelity sector funds from the group fee rate calculation once Fidelity SelectCo, LLC, an affiliate of FMR, assumed
management responsibilities for those funds. The Board noted that modifying the description of the group fee rate to continue to include the
assets of those 64 funds for purposes of determining group fee rate breakpoints would avoid an immediate adverse impact on the group fee
rate for any fund.
Additional Information Requested by the Board.
In order to develop fully the factual basis for consideration of the Fidelity funds'
Advisory Contracts, the Board requested and received additional information on certain topics, including: (i) fund performance trends and
Fidelity's long-term strategies for certain funds; (ii) the potential to further rationalize the Fidelity fund lineup with the possibility of achieving savings for the funds and Fidelity; (iii) the methodology with respect to competitive fund data and peer group classifications; (iv) the
arrangements with, and performance of, certain sub-advisers on behalf of the Fidelity funds, as well as certain proposed participating affiliate
arrangements; (v) the realization of fall-out benefits in certain Fidelity business units; (vi) Fidelity's group fee structures, including the
rationale for the individual fee rates of certain categories of funds and the definition of group assets; (vii) trends regarding industry use of
performance fee structures and the performance adjustment methodologies applicable to the Fidelity funds; (viii) additional competitive
analysis regarding the total expenses for certain classes; and (ix) fund profitability methodology, including Fidelity's cost allocation methodology, and the impact of certain factors on fund profitability results.
Based on its evaluation of all of the conclusions noted above, and after considering all factors it believed relevant, the Board ultimately
concluded that the advisory fee structures are fair and reasonable, and that the fund's Advisory Contracts should be renewed.
Annual Report
Investment Adviser
Fidelity Management & Research Company
Boston, MA
Investment Sub-Advisers
FMR Co., Inc.
Fidelity Management & Research
(U.K.) Inc.
Fidelity Management & Research
(Hong Kong) Limited
Fidelity Management & Research
(Japan) Inc.
General Distributor
Fidelity Distributors Corporation
Smithfield, RI
Transfer and Service Agents
Fidelity Investments Institutional
Operations Company, Inc.
Boston, MA
Fidelity Service Company, Inc.
Boston, MA
Custodian
JPMorgan Chase Bank
New York, NY
(Fidelity Investment logo)(registered trademark)
ALSF-UANN-0913
1.786693.110
(Fidelity Investment logo)(registered trademark)
Fidelity Advisor
®
Leveraged Company Stock
Fund - Institutional Class
Annual Report
July 31, 2013
(Fidelity Cover Art)
Contents
Performance
|
(Click
Here)
|
How the fund has done over time.
|
Management's Discussion of Fund
Performance
|
(Click
Here)
|
The Portfolio Manager's review of fund performance and strategy.
|
Shareholder Expense Example
|
(Click
Here)
|
An example of shareholder expenses.
|
Investment Changes
|
(Click
Here)
|
A summary of major shifts in the fund's investments over the past
six months.
|
Investments
|
(Click
Here)
|
A complete list of the fund's investments with their market values.
|
Financial Statements
|
(Click
Here)
|
Statements of assets and liabilities, operations, and changes in net
assets, as well as financial highlights.
|
Notes
|
(Click
Here)
|
Notes to the financial statements.
|
Report of Independent Registered Public
Accounting Firm
|
(Click
Here)
|
|
Trustees and Officers
|
(Click
Here)
|
|
Distributions
|
(Click
Here)
|
|
Board Approval of Investment Advisory
Contracts and Management Fees
|
(Click
Here)
|
|
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. © 2013 FMR LLC. All
rights reserved.
Annual Report
This report and the financial statements contained herein are submitted for the general information
of the shareholders of the fund. This report is not authorized for distribution to prospective investors
in the fund unless preceded or accompanied by an effective prospectus.
A fund files its complete schedule of portfolio holdings with the SEC for the first and third
quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC's web site at
http://www.sec.gov
.
A fund's Forms N-Q may be reviewed and copied at the SEC's Public Reference
Room in Washington, DC. Information regarding the operation of the SEC's Public Reference
Room may be obtained by calling 1-800-SEC-0330. For a complete list of a fund's portfolio
holdings, view the most recent holdings listing, semiannual report, or annual report on
Fidelity's web site at http://www.fidelity.com, http://www.advisor.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.
Annual Report
Average annual total return reflects the change in the value of an investment, assuming reinvestment of the class' distributions from
dividend income and capital gains (the profits earned upon the sale of securities that have grown in value, if any) and assuming a constant
rate of performance each year. The $10,000 table and the fund's returns do not reflect the deduction of taxes that a shareholder would pay
on fund distributions or the redemption of fund shares. During periods of reimbursement by Fidelity, a fund's total return will be greater
than it would be had the reimbursement not occurred. How a fund did yesterday is no guarantee of how it will do tomorrow.
Average Annual Total Returns
Periods ended July 31, 2013
|
Past 1
year
|
Past 5
years
|
Past 10
years
|
Institutional Class
|
42.34%
|
6.73%
|
13.54%
|
$10,000 Over 10 Years
Let's say hypothetically that $10,000 was invested in Fidelity Advisor® Leveraged Company Stock Fund - Institutional Class on July 31, 2003.
The chart shows how the value of your investment would have changed, and also shows how the S&P 500® Index performed over the same period.
Annual Report
Market Recap:
The bull run in U.S. stocks comfortably settled into a fifth year, as major equity benchmarks ripped through records during the 12
months ending July 31, 2013. Gains were fueled by a generally improving global economy and accommodative monetary policies worldwide. The
tone was positive for most of the year, based largely on stronger U.S. economic data, including employment, housing and consumer sentiment.
Setting a series of new highs along the way, the broad-based S&P 500® Index rose an impressive 25.00% for the 12 months, while the blue-chip-laden Dow Jones Industrial Average
SM
also moved into record territory en route to a 22.36% gain. The growth-oriented Nasdaq Composite Index®
had a similarly strong run, advancing 25.15%. During the year, markets were resilient amid intermittent volatility over debt woes in Europe, the
2012 U.S. presidential election and year-end Congressional gridlock over the federal budget. In mid-to-late June, concern arose about the U.S.
Federal Reserve possibly tapering its sustaining bond-buying strategy - which prompted a brief, but steep, market sell-off. However, investors'
continued quest for yield and the Fed's pledge to keep buying bonds until the economy showed significant improvement overpowered the uncertainty and helped equities climb notably higher in July to close the period on a strong note.
Comments from Thomas Soviero, Portfolio Manager of Fidelity Advisor
®
Leveraged Company Stock Fund:
For the year, the fund's
Institutional Class shares returned 42.34%, significantly outperforming the S&P 500®. I concentrate the fund in what I consider to be my best ideas.
I made the fund more U.S.-centric, adding to consumer discretionary names such as major automotive manufacturers Ford Motor and General
Motors. I also sought to take advantage of the recent manufacturing renaissance in the U.S. The fund's largest holding and top contributor to
relative performance was chemicals manufacturer LyondellBasell Industries. Other decisions that helped included largely avoiding consumer
electronics giant and underperforming index component Apple - which was not held by the fund at period end - overweighting outperforming
video game retailer GameStop. During the period, the fund's performance relative to the index was curtailed the most by its roughly 7% cash
weighting, which I held as I waited for new opportunities, but was a negative in a strong market. An underweighting in financials also detracted.
At the individual issuer level, global independent power producer AES, with headquarters in Virginia, underperformed and detracted, as did an
out-of-benchmark position in South Africa-based AngloGold Ashanti.
Annual Report
The views expressed above reflect those of the portfolio manager(s) only through the end of the period as stated on the cover of this report and do
not necessarily represent the views of Fidelity or any other person in the Fidelity organization. Any such views are subject to change at any time
based upon market or other conditions and Fidelity disclaims any responsibility to update such views. These views may not be relied on as
investment advice and, because investment decisions for a Fidelity fund are based on numerous factors, may not be relied on as an indication of
trading intent on behalf of any Fidelity fund.
Annual Report
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments or redemption proceeds, and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees and other Fund expenses. This Example
is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of
investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (February 1, 2013 to July 31,
2013).
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.
Annual Report
Shareholder Expense Example - continued
|
Annualized
Expense Ratio
B
|
Beginning
Account Value
February 1, 2013
|
Ending
Account Value
July 31, 2013
|
Expenses Paid
During Period
*
February 1, 2013
to July 31, 2013
|
Class A
|
1.10%
|
|
|
|
Actual
|
|
$ 1,000.00
|
$ 1,151.60
|
$ 5.87
|
Hypothetical
A
|
|
$ 1,000.00
|
$ 1,019.34
|
$ 5.51
|
Class T
|
1.33%
|
|
|
|
Actual
|
|
$ 1,000.00
|
$ 1,150.10
|
$ 7.09
|
Hypothetical
A
|
|
$ 1,000.00
|
$ 1,018.20
|
$ 6.66
|
Class B
|
1.90%
|
|
|
|
Actual
|
|
$ 1,000.00
|
$ 1,146.90
|
$ 10.11
|
Hypothetical
A
|
|
$ 1,000.00
|
$ 1,015.37
|
$ 9.49
|
Class C
|
1.84%
|
|
|
|
Actual
|
|
$ 1,000.00
|
$ 1,147.30
|
$ 9.80
|
Hypothetical
A
|
|
$ 1,000.00
|
$ 1,015.67
|
$ 9.20
|
Institutional Class
|
.83%
|
|
|
|
Actual
|
|
$ 1,000.00
|
$ 1,152.90
|
$ 4.43
|
Hypothetical
A
|
|
$ 1,000.00
|
$ 1,020.68
|
$ 4.16
|
A
5% return per year before expenses
B
Annualized expense ratio reflects expenses net of applicable fee waivers.
*
Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by
181/365 (to reflect the one-half year period).
Annual Report
Investment Changes (Unaudited)
Top Ten Stocks as of July 31, 2013
|
|
% of fund's
net assets
|
% of fund's net assets
6 months ago
|
LyondellBasell Industries NV Class A
|
7.2
|
8.2
|
Service Corp. International
|
4.2
|
4.4
|
Comcast Corp. Class A
|
3.6
|
3.0
|
General Motors Co.
|
3.1
|
2.8
|
Ford Motor Co.
|
2.9
|
2.1
|
GameStop Corp. Class A
|
2.5
|
1.8
|
Tenet Healthcare Corp.
|
2.2
|
2.4
|
Bank of America Corp.
|
2.1
|
0.0
|
Boston Scientific Corp.
|
2.0
|
0.9
|
The AES Corp.
|
1.8
|
3.3
|
|
31.6
|
|
Top Five Market Sectors as of July 31, 2013
|
|
% of fund's
net assets
|
% of fund's net assets
6 months ago
|
Consumer Discretionary
|
26.0
|
24.6
|
Materials
|
11.3
|
12.7
|
Industrials
|
11.2
|
11.5
|
Health Care
|
10.6
|
9.0
|
Financials
|
9.9
|
7.1
|
Asset Allocation (% of fund's net assets)
|
As of July 31, 2013
*
|
As of January 31, 2013
**
|
|
Stocks 91.2%
|
|
|
Stocks 91.3%
|
|
|
Bonds 0.3%
|
|
|
Bonds 1.0%
|
|
|
Convertible
Securities 0.1%
|
|
|
Convertible
Securities 0.1%
|
|
|
Other Investments 0.1%
|
|
|
Other Investments 0.4%
|
|
|
Short-Term
Investments and
Net Other Assets (Liabilities) 8.3%
|
|
|
Short-Term
Investments and
Net Other Assets (Liabilities) 7.2%
|
|
*
Foreign investments
|
13.4%
|
|
**
Foreign investments
|
13.3%
|
|
Annual Report
Investments July 31, 2013
Showing Percentage of Net Assets
Common Stocks - 90.8%
|
|
Shares
|
|
Value (000s)
|
CONSUMER DISCRETIONARY - 25.7%
|
Auto Components - 1.9%
|
Delphi Automotive PLC
|
446,000
|
|
$ 23,959
|
Exide Technologies (a)(e)
|
3,282,263
|
|
427
|
Tenneco, Inc. (a)
|
630,300
|
|
30,462
|
TRW Automotive Holdings Corp. (a)
|
298,400
|
|
21,876
|
|
|
76,724
|
Automobiles - 6.5%
|
Ford Motor Co.
|
7,095,667
|
|
119,775
|
General Motors Co. (a)
|
3,454,500
|
|
123,913
|
General Motors Co.:
|
|
|
|
warrants 7/10/16 (a)
|
365,056
|
|
9,594
|
warrants 7/10/19 (a)
|
365,056
|
|
6,801
|
Motors Liquidation Co. GUC Trust (a)
|
100,812
|
|
3,292
|
|
|
263,375
|
Diversified Consumer Services - 4.2%
|
Service Corp. International
|
8,987,869
|
|
170,500
|
Hotels, Restaurants & Leisure - 0.4%
|
Penn National Gaming, Inc. (a)
|
297,660
|
|
14,880
|
Station Holdco LLC unit (h)(i)
|
116,342
|
|
7
|
|
|
14,887
|
Household Durables - 1.9%
|
Hovnanian Enterprises, Inc. Class A (a)(e)
|
1,181,000
|
|
6,318
|
Lennar Corp. Class A (e)
|
576,600
|
|
19,529
|
Newell Rubbermaid, Inc.
|
1,935,853
|
|
52,307
|
|
|
78,154
|
Leisure Equipment & Products - 0.2%
|
Callaway Golf Co. (e)
|
1,339,225
|
|
9,616
|
Media - 6.3%
|
Cinemark Holdings, Inc.
|
2,129,655
|
|
62,016
|
Comcast Corp. Class A
|
3,208,166
|
|
144,624
|
Gray Television, Inc. (a)(f)
|
3,167,163
|
|
24,736
|
Nexstar Broadcasting Group, Inc. Class A
|
664,102
|
|
23,934
|
|
|
255,310
|
Multiline Retail - 0.5%
|
Target Corp.
|
283,600
|
|
20,207
|
Specialty Retail - 3.8%
|
Asbury Automotive Group, Inc. (a)
|
314,878
|
|
15,379
|
Common Stocks - continued
|
|
Shares
|
|
Value (000s)
|
CONSUMER DISCRETIONARY - continued
|
Specialty Retail - continued
|
GameStop Corp. Class A (e)
|
2,061,075
|
|
$ 101,116
|
Sally Beauty Holdings, Inc. (a)
|
1,303,600
|
|
39,773
|
|
|
156,268
|
TOTAL CONSUMER DISCRETIONARY
|
|
1,045,041
|
CONSUMER STAPLES - 2.5%
|
Food Products - 2.2%
|
ConAgra Foods, Inc.
|
438,800
|
|
15,889
|
Darling International, Inc. (a)
|
2,916,158
|
|
59,198
|
Smithfield Foods, Inc. (a)
|
457,894
|
|
15,202
|
|
|
90,289
|
Personal Products - 0.3%
|
Revlon, Inc. (a)
|
459,739
|
|
11,535
|
TOTAL CONSUMER STAPLES
|
|
101,824
|
ENERGY - 9.6%
|
Energy Equipment & Services - 2.9%
|
Ensco PLC Class A
|
90,000
|
|
5,161
|
Halliburton Co.
|
943,707
|
|
42,646
|
Noble Corp.
|
753,990
|
|
28,802
|
Oil States International, Inc. (a)
|
203,434
|
|
19,780
|
Schlumberger Ltd.
|
90,600
|
|
7,368
|
Transocean Ltd. (United States)
|
316,300
|
|
14,917
|
|
|
118,674
|
Oil, Gas & Consumable Fuels - 6.7%
|
Alpha Natural Resources, Inc. (a)
|
5,150,437
|
|
28,018
|
Continental Resources, Inc. (a)
|
440,013
|
|
40,613
|
Forest Oil Corp. (a)
|
1,006,891
|
|
5,155
|
Hess Corp.
|
633,490
|
|
47,170
|
HollyFrontier Corp.
|
1,275,165
|
|
58,084
|
Kodiak Oil & Gas Corp. (a)
|
1,639,653
|
|
15,921
|
Peabody Energy Corp.
|
677,175
|
|
11,214
|
Range Resources Corp.
|
202,800
|
|
16,041
|
Common Stocks - continued
|
|
Shares
|
|
Value (000s)
|
ENERGY - continued
|
Oil, Gas & Consumable Fuels - continued
|
Valero Energy Corp.
|
1,003,334
|
|
$ 35,889
|
Western Refining, Inc. (e)
|
511,986
|
|
15,426
|
|
|
273,531
|
TOTAL ENERGY
|
|
392,205
|
FINANCIALS - 9.6%
|
Commercial Banks - 3.1%
|
CIT Group, Inc. (a)
|
170,690
|
|
8,553
|
Huntington Bancshares, Inc.
|
7,094,120
|
|
60,655
|
Regions Financial Corp.
|
2,739,606
|
|
27,423
|
SunTrust Banks, Inc.
|
836,400
|
|
29,098
|
|
|
125,729
|
Consumer Finance - 0.9%
|
American Express Co.
|
515,752
|
|
38,047
|
Diversified Financial Services - 3.5%
|
Bank of America Corp.
|
5,896,101
|
|
86,083
|
Citigroup, Inc.
|
1,110,553
|
|
57,904
|
|
|
143,987
|
Insurance - 1.2%
|
AFLAC, Inc.
|
530,400
|
|
32,715
|
Lincoln National Corp.
|
360,400
|
|
15,018
|
|
|
47,733
|
Real Estate Investment Trusts - 0.7%
|
Host Hotels & Resorts, Inc.
|
832,331
|
|
14,865
|
Sabra Health Care REIT, Inc.
|
452,492
|
|
11,873
|
|
|
26,738
|
Real Estate Management & Development - 0.1%
|
Realogy Holdings Corp.
|
119,300
|
|
5,364
|
Thrifts & Mortgage Finance - 0.1%
|
MGIC Investment Corp. (a)
|
328,300
|
|
2,508
|
TOTAL FINANCIALS
|
|
390,106
|
HEALTH CARE - 10.6%
|
Health Care Equipment & Supplies - 2.5%
|
Boston Scientific Corp. (a)
|
7,480,575
|
|
81,688
|
Covidien PLC
|
286,325
|
|
17,646
|
|
|
99,334
|
Common Stocks - continued
|
|
Shares
|
|
Value (000s)
|
HEALTH CARE - continued
|
Health Care Providers & Services - 5.3%
|
Community Health Systems, Inc.
|
655,424
|
|
$ 30,189
|
DaVita, Inc. (a)
|
303,353
|
|
35,313
|
HCA Holdings, Inc.
|
998,521
|
|
38,942
|
Tenet Healthcare Corp. (a)
|
2,004,163
|
|
89,486
|
Universal Health Services, Inc. Class B
|
317,795
|
|
22,230
|
|
|
216,160
|
Pharmaceuticals - 2.8%
|
Johnson & Johnson
|
127,900
|
|
11,959
|
Mallinckrodt PLC (a)
|
35,790
|
|
1,642
|
Merck & Co., Inc.
|
1,321,200
|
|
63,642
|
Sanofi SA sponsored ADR (e)
|
745,266
|
|
38,366
|
|
|
115,609
|
TOTAL HEALTH CARE
|
|
431,103
|
INDUSTRIALS - 11.1%
|
Aerospace & Defense - 1.4%
|
Honeywell International, Inc.
|
387,924
|
|
32,190
|
Huntington Ingalls Industries, Inc.
|
196,360
|
|
12,210
|
Textron, Inc.
|
497,300
|
|
13,616
|
|
|
58,016
|
Airlines - 2.5%
|
Delta Air Lines, Inc.
|
2,920,820
|
|
62,009
|
Southwest Airlines Co.
|
478,033
|
|
6,611
|
U.S. Airways Group, Inc. (a)
|
1,236,200
|
|
23,920
|
United Continental Holdings, Inc. (a)
|
309,700
|
|
10,793
|
|
|
103,333
|
Building Products - 1.0%
|
Armstrong World Industries, Inc. (a)
|
580,581
|
|
29,075
|
Owens Corning (a)
|
246,439
|
|
9,732
|
Owens Corning warrants 10/31/13 (a)
|
193,400
|
|
193
|
|
|
39,000
|
Commercial Services & Supplies - 1.0%
|
Deluxe Corp.
|
781,427
|
|
32,046
|
Tyco International Ltd.
|
267,791
|
|
9,322
|
|
|
41,368
|
Electrical Equipment - 2.0%
|
Belden, Inc.
|
649,536
|
|
38,069
|
Emerson Electric Co.
|
136,500
|
|
8,377
|
Common Stocks - continued
|
|
Shares
|
|
Value (000s)
|
INDUSTRIALS - continued
|
Electrical Equipment - continued
|
Generac Holdings, Inc.
|
373,058
|
|
$ 16,172
|
General Cable Corp.
|
365,868
|
|
11,532
|
Polypore International, Inc. (a)(e)
|
182,200
|
|
7,651
|
|
|
81,801
|
Industrial Conglomerates - 0.7%
|
Carlisle Companies, Inc.
|
90,090
|
|
6,103
|
General Electric Co.
|
896,117
|
|
21,838
|
|
|
27,941
|
Machinery - 1.7%
|
Harsco Corp.
|
674,131
|
|
17,366
|
Ingersoll-Rand PLC
|
605,977
|
|
36,995
|
Pentair Ltd.
|
64,254
|
|
3,925
|
Timken Co.
|
187,566
|
|
10,958
|
|
|
69,244
|
Marine - 0.3%
|
Navios Maritime Holdings, Inc.
|
1,788,039
|
|
9,995
|
Road & Rail - 0.4%
|
Hertz Global Holdings, Inc. (a)
|
583,000
|
|
14,931
|
Trading Companies & Distributors - 0.1%
|
Edgen Group, Inc. Class A (a)
|
633,944
|
|
4,976
|
TOTAL INDUSTRIALS
|
|
450,605
|
INFORMATION TECHNOLOGY - 6.8%
|
Communications Equipment - 1.3%
|
Cisco Systems, Inc.
|
1,982,651
|
|
50,657
|
Computers & Peripherals - 1.1%
|
EMC Corp.
|
1,160,700
|
|
30,352
|
NCR Corp. (a)
|
430,369
|
|
15,493
|
|
|
45,845
|
Electronic Equipment & Components - 0.8%
|
Avnet, Inc. (a)
|
489,587
|
|
18,443
|
Corning, Inc.
|
605,400
|
|
9,196
|
SMTC Corp. (a)
|
34,050
|
|
65
|
Viasystems Group, Inc. (a)
|
441,914
|
|
6,562
|
|
|
34,266
|
Internet Software & Services - 0.2%
|
VeriSign, Inc. (a)
|
194,300
|
|
9,295
|
Common Stocks - continued
|
|
Shares
|
|
Value (000s)
|
INFORMATION TECHNOLOGY - continued
|
Semiconductors & Semiconductor Equipment - 2.6%
|
Advanced Micro Devices, Inc. (a)(e)
|
1,295,308
|
|
$ 4,883
|
Fairchild Semiconductor International, Inc. (a)
|
924,426
|
|
11,666
|
Freescale Semiconductor Holdings I Ltd. (a)(e)
|
939,600
|
|
14,752
|
Intersil Corp. Class A
|
1,177,013
|
|
12,017
|
Micron Technology, Inc. (a)
|
1,890,455
|
|
25,049
|
ON Semiconductor Corp. (a)
|
4,465,694
|
|
36,797
|
|
|
105,164
|
Software - 0.8%
|
Autodesk, Inc. (a)
|
236,100
|
|
8,356
|
Citrix Systems, Inc. (a)
|
190,801
|
|
13,741
|
Microsoft Corp.
|
91,200
|
|
2,903
|
Nuance Communications, Inc. (a)
|
464,834
|
|
8,720
|
|
|
33,720
|
TOTAL INFORMATION TECHNOLOGY
|
|
278,947
|
MATERIALS - 11.3%
|
Chemicals - 8.8%
|
H.B. Fuller Co.
|
380,376
|
|
15,272
|
LyondellBasell Industries NV Class A
|
4,267,493
|
|
293,220
|
OMNOVA Solutions, Inc. (a)(f)
|
2,609,132
|
|
21,030
|
Phosphate Holdings, Inc. (a)
|
192,500
|
|
193
|
The Dow Chemical Co.
|
284,012
|
|
9,952
|
W.R. Grace & Co. (a)
|
256,156
|
|
19,678
|
|
|
359,345
|
Containers & Packaging - 2.2%
|
Rock-Tenn Co. Class A
|
608,992
|
|
69,638
|
Sealed Air Corp.
|
678,051
|
|
18,470
|
|
|
88,108
|
Metals & Mining - 0.1%
|
AngloGold Ashanti Ltd. sponsored ADR
|
437,500
|
|
5,762
|
Ormet Corp. (a)
|
500,000
|
|
5
|
Ormet Corp. (a)(i)
|
150,000
|
|
1
|
|
|
5,768
|
Paper & Forest Products - 0.2%
|
Neenah Paper, Inc.
|
231,700
|
|
9,168
|
TOTAL MATERIALS
|
|
462,389
|
Common Stocks - continued
|
|
Shares
|
|
Value (000s)
|
TELECOMMUNICATION SERVICES - 0.5%
|
Diversified Telecommunication Services - 0.5%
|
Intelsat SA
|
855,300
|
|
$ 18,338
|
Level 3 Communications, Inc. (a)
|
184,741
|
|
4,074
|
|
|
22,412
|
UTILITIES - 3.1%
|
Electric Utilities - 0.3%
|
FirstEnergy Corp.
|
341,796
|
|
13,012
|
Independent Power Producers & Energy Traders - 2.8%
|
Calpine Corp. (a)
|
1,970,200
|
|
39,424
|
The AES Corp.
|
5,982,695
|
|
74,425
|
|
|
113,849
|
TOTAL UTILITIES
|
|
126,861
|
TOTAL COMMON STOCKS
(Cost $2,583,324)
|
3,701,493
|
Nonconvertible Preferred Stocks - 0.4%
|
|
|
|
|
CONSUMER STAPLES - 0.1%
|
Personal Products - 0.1%
|
Revlon, Inc. Series A 12.75%
|
1,007,783
|
|
5,442
|
FINANCIALS - 0.3%
|
Diversified Financial Services - 0.3%
|
GMAC Capital Trust I Series 2, 8.125%
|
360,987
|
|
9,584
|
TOTAL NONCONVERTIBLE PREFERRED STOCKS
(Cost $22,062)
|
15,026
|
Corporate Bonds - 0.4%
|
|
Principal Amount (000s)
|
|
|
Convertible Bonds - 0.1%
|
INDUSTRIALS - 0.1%
|
Marine - 0.1%
|
Genco Shipping & Trading Ltd. 5% 8/15/15
|
|
$ 9,934
|
|
2,676
|
Corporate Bonds - continued
|
|
Principal Amount (000s)
|
|
Value (000s)
|
Nonconvertible Bonds - 0.3%
|
CONSUMER DISCRETIONARY - 0.3%
|
Automobiles - 0.0%
|
General Motors Corp.:
|
|
|
|
|
6.75% 5/1/28 (d)
|
|
$ 2,515
|
|
$ 0
|
7.125% 7/15/49 (d)
|
|
6,805
|
|
0
|
7.2% 1/15/11 (d)
|
|
18,790
|
|
0
|
8.25% 7/15/23 (d)
|
|
20,460
|
|
0
|
8.375% 7/15/33 (d)
|
|
41,210
|
|
0
|
8.8% 3/1/21 (d)
|
|
8,800
|
|
0
|
Multiline Retail - 0.3%
|
The Bon-Ton Department Stores, Inc. 10.625% 7/15/17
|
|
13,962
|
|
13,945
|
TOTAL CORPORATE BONDS
(Cost $17,458)
|
16,621
|
Floating Rate Loans - 0.1%
|
|
UTILITIES - 0.1%
|
Electric Utilities - 0.1%
|
Texas Competitive Electric Holdings Co. LLC/Texas Competitive Electric Holdings Finance, Inc.
Tranche B, term loan 4.7212% 10/10/17 (g)
(Cost $3,829)
|
|
4,289
|
|
3,008
|
Money Market Funds - 10.2%
|
|
Shares
|
|
Value (000s)
|
Fidelity Cash Central Fund, 0.11% (b)
|
339,411,742
|
|
$ 339,412
|
Fidelity Securities Lending Cash Central Fund, 0.12% (b)(c)
|
77,416,700
|
|
77,417
|
TOTAL MONEY MARKET FUNDS
(Cost $416,829)
|
416,829
|
TOTAL INVESTMENT PORTFOLIO - 101.9%
(Cost $3,043,502)
|
|
4,152,977
|
NET OTHER ASSETS (LIABILITIES) - (1.9)%
|
|
(78,779
)
|
NET ASSETS - 100%
|
$ 4,074,198
|
Legend
|
(a) Non-income producing
|
(b) 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, which are not covered by the Fund's Report of Independent Registered Public Accounting Firm, are
available on the SEC's website or upon request.
|
(c) Investment made with cash collateral received from securities on loan.
|
(d) Non-income producing - Security is in default.
|
(e) Security or a portion of the security is on loan at period end.
|
(f) Affiliated company
|
(g) Coupon rates for floating and adjustable rate securities reflect the rates in effect at period end.
|
(h) Investment is owned by an entity that is treated as a corporation for U.S. tax purposes and is owned by the Fund.
|
(i) 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 $8,000 or 0.0% of net assets.
|
Additional information on each restricted holding is as follows:
|
Security
|
Acquisition Date
|
Acquisition Cost (000s)
|
Ormet Corp.
|
5/14/07
|
$ 3,263
|
Station Holdco LLC unit
|
10/28/08 - 12/1/08
|
$ 4,745
|
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
|
$ 386
|
Fidelity Securities Lending Cash Central Fund
|
2,373
|
Total
|
$ 2,759
|
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
|
Gray Television, Inc.
|
$ 5,321
|
$ -
|
$ -
|
$ -
|
$ 24,736
|
OMNOVA Solutions, Inc.
|
18,994
|
-
|
-
|
-
|
21,030
|
Service Corp. International
|
147,381
|
-
|
38,217
|
2,516
|
-
|
Total
|
$ 171,696
|
$ -
|
$ 38,217
|
$ 2,516
|
$ 45,766
|
Other Information
|
The following is a summary of the inputs used, as of July 31, 2013, 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 in the table below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
|
Valuation Inputs at Reporting Date:
|
Description
(Amounts in thousands)
|
Total
|
Level 1
|
Level 2
|
Level 3
|
Investments in Securities:
|
|
|
|
|
Equities:
|
|
|
|
|
Consumer Discretionary
|
$ 1,045,041
|
$ 1,045,034
|
$ -
|
$ 7
|
Consumer Staples
|
107,266
|
107,266
|
-
|
-
|
Energy
|
392,205
|
392,205
|
-
|
-
|
Financials
|
399,690
|
399,690
|
-
|
-
|
Health Care
|
431,103
|
431,103
|
-
|
-
|
Industrials
|
450,605
|
450,605
|
-
|
-
|
Information Technology
|
278,947
|
278,947
|
-
|
-
|
Valuation Inputs at Reporting Date:
|
Description
(Amounts in thousands)
|
Total
|
Level 1
|
Level 2
|
Level 3
|
Investments in Securities:
|
|
|
|
|
Equities:
|
|
|
|
|
Materials
|
$ 462,389
|
$ 462,389
|
$ -
|
$ -
|
Telecommunication Services
|
22,412
|
22,412
|
-
|
-
|
Utilities
|
126,861
|
126,861
|
-
|
-
|
Corporate Bonds
|
16,621
|
-
|
16,621
|
-
|
Floating Rate Loans
|
3,008
|
-
|
3,008
|
-
|
Money Market Funds
|
416,829
|
416,829
|
-
|
-
|
Total Investments in Securities:
|
$ 4,152,977
|
$ 4,133,341
|
$ 19,629
|
$ 7
|
Distribution of investments by country or territory of incorporation, as a percentage of total net assets, is as follows. (Unaudited)
|
United States of America
|
86.6%
|
Netherlands
|
7.2%
|
Ireland
|
1.4%
|
Switzerland
|
1.3%
|
Others (Individually Less Than 1%)
|
3.5%
|
|
100.0%
|
See accompanying notes which are an integral part of the financial statements.
Annual Report
Statement of Assets and Liabilities
Amounts in thousands (except per-share amounts)
|
July 31, 2013
|
|
|
|
Assets
|
|
|
Investment in securities, at value (including securities loaned of $74,943) - See
accompanying schedule:
Unaffiliated issuers (cost $2,591,708)
|
$ 3,690,382
|
|
Fidelity Central Funds (cost $416,829)
|
416,829
|
|
Other affiliated issuers (cost $34,965)
|
45,766
|
|
Total Investments (cost $3,043,502)
|
|
$ 4,152,977
|
Receivable for investments sold
|
|
10
|
Receivable for fund shares sold
|
|
6,124
|
Dividends receivable
|
|
1,622
|
Interest receivable
|
|
814
|
Distributions receivable from Fidelity Central Funds
|
|
54
|
Other receivables
|
|
659
|
Total assets
|
|
4,162,260
|
|
|
|
Liabilities
|
|
|
Payable for fund shares redeemed
|
$ 6,352
|
|
Accrued management fee
|
2,004
|
|
Distribution and service plan fees payable
|
1,214
|
|
Other affiliated payables
|
728
|
|
Other payables and accrued expenses
|
347
|
|
Collateral on securities loaned, at value
|
77,417
|
|
Total liabilities
|
|
88,062
|
|
|
|
Net Assets
|
|
$ 4,074,198
|
Net Assets consist of:
|
|
|
Paid in capital
|
|
$ 3,316,323
|
Undistributed net investment income
|
|
7,496
|
Accumulated undistributed net realized gain (loss) on investments and foreign currency
transactions
|
|
(359,096)
|
Net unrealized appreciation (depreciation) on investments
|
|
1,109,475
|
Net Assets
|
|
$ 4,074,198
|
See accompanying notes which are an integral part of the financial statements.
Annual Report
Statement of Assets and Liabilities - continued
Amounts in thousands (except per-share amounts)
|
July 31, 2013
|
|
|
|
Calculation of Maximum Offering Price
Class A:
Net Asset Value
and redemption price per share ($1,490,413 ÷ 30,649 shares)
|
|
$ 48.63
|
|
|
|
Maximum offering price per share (100/94.25 of $48.63)
|
|
$ 51.60
|
Class T
:
Net Asset Value
and redemption price per share ($1,011,907 ÷ 21,263 shares)
|
|
$ 47.59
|
|
|
|
Maximum offering price per share (100/96.50 of $47.59)
|
|
$ 49.32
|
Class B
:
Net Asset Value
and offering price per share ($79,892 ÷ 1,752 shares)
A
|
|
$ 45.60
|
|
|
|
Class C
:
Net Asset Value
and offering price per share ($526,519 ÷ 11,534 shares)
A
|
|
$ 45.65
|
|
|
|
Institutional Class
:
Net Asset Value
, offering price and redemption price per share ($965,467 ÷ 19,548 shares)
|
|
$ 49.39
|
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.
Annual Report
Financial Statements - continued
Statement of Operations
Amounts in thousands
|
Year ended July 31, 2013
|
|
|
|
Investment Income
|
|
|
Dividends (including $2,516 earned from other affiliated issuers)
|
|
$ 57,654
|
Special dividends
|
|
8,020
|
Interest
|
|
6,637
|
Income from Fidelity Central Funds
|
|
2,759
|
Total income
|
|
75,070
|
|
|
|
Expenses
|
|
|
Management fee
|
$ 20,863
|
|
Transfer agent fees
|
7,096
|
|
Distribution and service plan fees
|
12,926
|
|
Accounting and security lending fees
|
998
|
|
Custodian fees and expenses
|
36
|
|
Independent trustees' compensation
|
21
|
|
Registration fees
|
146
|
|
Audit
|
65
|
|
Legal
|
13
|
|
Miscellaneous
|
25
|
|
Total expenses before reductions
|
42,189
|
|
Expense reductions
|
(134
)
|
42,055
|
Net investment income (loss)
|
|
33,015
|
Realized and Unrealized Gain (Loss)
Net realized gain (loss) on:
|
|
|
Investment securities:
|
|
|
Unaffiliated issuers
|
254,399
|
|
Other affiliated issuers
|
18,283
|
|
Foreign currency transactions
|
1
|
|
Total net realized gain (loss)
|
|
272,683
|
Change in net unrealized appreciation (depreciation) on investment securities
|
|
883,039
|
Net gain (loss)
|
|
1,155,722
|
Net
increase (decrease) in net assets resulting from operations
|
|
$ 1,188,737
|
See accompanying notes which are an integral part of the financial statements.
Annual Report
Statement of Changes in Net Assets
Amounts in thousands
|
Year ended
July 31,
2013
|
Year ended
July 31,
2012
|
Increase (Decrease) in Net Assets
|
|
|
Operations
|
|
|
Net investment income (loss)
|
$ 33,015
|
$ 6,161
|
Net realized gain (loss)
|
272,683
|
166,758
|
Change in net unrealized appreciation (depreciation)
|
883,039
|
(273,036
)
|
Net
increase (decrease) in net assets resulting
from operations
|
1,188,737
|
(100,117
)
|
Distributions to shareholders from net investment income
|
(2,596
)
|
(28,865
)
|
Share transactions - net increase (decrease)
|
(90,255
)
|
(562,983
)
|
Total increase (decrease) in net assets
|
1,095,886
|
(691,965)
|
|
|
|
Net Assets
|
|
|
Beginning of period
|
2,978,312
|
3,670,277
|
End of period (including undistributed net investment income of $7,496 and accumulated net
investment loss of $22,843, respectively)
|
$ 4,074,198
|
$ 2,978,312
|
See accompanying notes which are an integral part of the financial statements.
Annual Report
Financial Highlights - Class A
Years ended July 31,
|
2013
|
2012
|
2011
|
2010
|
2009
|
Selected Per-Share Data
|
|
|
|
|
|
Net asset value, beginning of period
|
$ 34.29
|
$ 35.01
|
$ 28.55
|
$ 23.69
|
$ 36.47
|
Income from Investment Operations
|
|
|
|
|
|
Net investment income (loss)
C
|
.44
F
|
.11
|
(.08)
|
.05
|
.27
|
Net realized and unrealized gain (loss)
|
13.94
|
(.51
)
|
6.61
|
4.91
|
(12.93
)
|
Total from investment operations
|
14.38
|
(.40
)
|
6.53
|
4.96
|
(12.66
)
|
Distributions from net investment income
|
(.04)
|
(.32)
|
(.01)
G
|
(.09)
|
(.12)
|
Distributions from net realized gain
|
-
|
-
|
(.06
)
G
|
(.01
)
|
-
|
Total distributions
|
(.04
)
|
(.32
)
|
(.07
)
|
(.10
)
|
(.12
)
|
Net asset value, end of period
|
$ 48.63
|
$ 34.29
|
$ 35.01
|
$ 28.55
|
$ 23.69
|
Total Return
A,B
|
41.95%
|
(1.04)%
|
22.88%
|
20.96%
|
(34.57)%
|
Ratios to Average Net Assets
D,H
|
|
|
|
|
|
Expenses before reductions
|
1.11%
|
1.13%
|
1.13%
|
1.15%
|
1.20%
|
Expenses net of fee waivers, if any
|
1.11%
|
1.13%
|
1.13%
|
1.15%
|
1.20%
|
Expenses net of all reductions
|
1.10%
|
1.13%
|
1.12%
|
1.15%
|
1.20%
|
Net investment income (loss)
|
1.07%
F
|
.33%
|
(.23)%
|
.18%
|
1.27%
|
Supplemental Data
|
|
|
|
|
|
Net assets, end of period (in millions)
|
$ 1,490
|
$ 1,106
|
$ 1,426
|
$ 1,428
|
$ 1,343
|
Portfolio turnover rate
E
|
17%
|
30%
|
18%
|
22%
|
45%
|
A
Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
B
Total returns do not include the effect of the sales charges.
C
Calculated based on average shares outstanding during the period.
D
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.
E
Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
F
Investment income per share reflects a large, non-recurring dividend which amounted to $.10 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .84%.
G
The amounts shown reflect certain reclassifications related to book to tax differences that were made in the year shown.
H
Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage
service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
See accompanying notes which are an integral part of the financial statements.
Annual Report
Financial Highlights - Class T
Years ended July 31,
|
2013
|
2012
|
2011
|
2010
|
2009
|
Selected Per-Share Data
|
|
|
|
|
|
Net asset value, beginning of period
|
$ 33.60
|
$ 34.36
|
$ 28.05
|
$ 23.30
|
$ 35.91
|
Income from Investment Operations
|
|
|
|
|
|
Net investment income (loss)
C
|
.34
F
|
.03
|
(.15)
|
(.01)
|
.22
|
Net realized and unrealized gain (loss)
|
13.65
|
(.50
)
|
6.48
|
4.83
|
(12.73
)
|
Total from investment operations
|
13.99
|
(.47
)
|
6.33
|
4.82
|
(12.51
)
|
Distributions from net investment income
|
-
I
|
(.29)
|
-
G
|
(.06)
|
(.10)
|
Distributions from net realized gain
|
-
|
-
|
(.02
)
G
|
(.01
)
|
-
|
Total distributions
|
-
I
|
(.29
)
|
(.02
)
|
(.07
)
|
(.10
)
|
Net asset value, end of period
|
$ 47.59
|
$ 33.60
|
$ 34.36
|
$ 28.05
|
$ 23.30
|
Total Return
A,B
|
41.65%
|
(1.26)%
|
22.58%
|
20.72%
|
(34.71)%
|
Ratios to Average Net Assets
D,H
|
|
|
|
|
|
Expenses before reductions
|
1.34%
|
1.35%
|
1.35%
|
1.37%
|
1.42%
|
Expenses net of fee waivers, if any
|
1.34%
|
1.35%
|
1.35%
|
1.37%
|
1.42%
|
Expenses net of all reductions
|
1.33%
|
1.35%
|
1.35%
|
1.37%
|
1.42%
|
Net investment income (loss)
|
.85%
F
|
.11%
|
(.45)%
|
(.04)%
|
1.05%
|
Supplemental Data
|
|
|
|
|
|
Net assets, end of period (in millions)
|
$ 1,012
|
$ 753
|
$ 906
|
$ 867
|
$ 728
|
Portfolio turnover rate
E
|
17%
|
30%
|
18%
|
22%
|
45%
|
A
Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
B
Total returns do not include the effect of the sales charges.
C
Calculated based on average shares outstanding during the period.
D
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.
E
Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
F
Investment income per share reflects a large, non-recurring dividend which amounted to $.09 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .61%.
G
The amounts shown reflect certain reclassifications related to book to tax differences that were made in the year shown.
H
Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage
service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
I
Amount represents less than $.01 per share.
See accompanying notes which are an integral part of the financial statements.
Annual Report
Financial Highlights - Class B
Years ended July 31,
|
2013
|
2012
|
2011
|
2010
|
2009
|
Selected Per-Share Data
|
|
|
|
|
|
Net asset value, beginning of period
|
$ 32.38
|
$ 33.24
|
$ 27.27
|
$ 22.73
|
$ 35.10
|
Income from Investment Operations
|
|
|
|
|
|
Net investment income (loss)
C
|
.10
F
|
(.15)
|
(.33)
|
(.17)
|
.10
|
Net realized and unrealized gain (loss)
|
13.12
|
(.49
)
|
6.30
|
4.72
|
(12.43
)
|
Total from investment operations
|
13.22
|
(.64
)
|
5.97
|
4.55
|
(12.33
)
|
Distributions from net investment income
|
-
|
(.22)
|
-
|
-
|
(.04)
|
Distributions from net realized gain
|
-
|
-
|
-
|
(.01
)
|
-
|
Total distributions
|
-
|
(.22
)
|
-
|
(.01
)
|
(.04
)
|
Net asset value, end of period
|
$ 45.60
|
$ 32.38
|
$ 33.24
|
$ 27.27
|
$ 22.73
|
Total Return
A,B
|
40.83%
|
(1.85)%
|
21.89%
|
20.00%
|
(35.06)%
|
Ratios to Average Net Assets
D,G
|
|
|
|
|
|
Expenses before reductions
|
1.91%
|
1.94%
|
1.93%
|
1.96%
|
1.97%
|
Expenses net of fee waivers, if any
|
1.91%
|
1.94%
|
1.93%
|
1.96%
|
1.97%
|
Expenses net of all reductions
|
1.91%
|
1.93%
|
1.92%
|
1.96%
|
1.97%
|
Net investment income (loss)
|
.27%
F
|
(.48)%
|
(1.03)%
|
(.63)%
|
.49%
|
Supplemental Data
|
|
|
|
|
|
Net assets, end of period (in millions)
|
$ 80
|
$ 84
|
$ 121
|
$ 131
|
$ 128
|
Portfolio turnover rate
E
|
17%
|
30%
|
18%
|
22%
|
45%
|
A
Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
B
Total returns do not include the effect of the contingent deferred sales charge.
C
Calculated based on average shares outstanding during the period.
D
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.
E
Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
F
Investment income per share reflects a large, non-recurring dividend which amounted to $.09 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .04%.
G
Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage
service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
See accompanying notes which are an integral part of the financial statements.
Annual Report
Financial Highlights - Class C
Years ended July 31,
|
2013
|
2012
|
2011
|
2010
|
2009
|
Selected Per-Share Data
|
|
|
|
|
|
Net asset value, beginning of period
|
$ 32.40
|
$ 33.24
|
$ 27.26
|
$ 22.70
|
$ 35.05
|
Income from Investment Operations
|
|
|
|
|
|
Net investment income (loss)
C
|
.13
F
|
(.12)
|
(.31)
|
(.15)
|
.11
|
Net realized and unrealized gain (loss)
|
13.12
|
(.49
)
|
6.29
|
4.72
|
(12.42
)
|
Total from investment operations
|
13.25
|
(.61
)
|
5.98
|
4.57
|
(12.31
)
|
Distributions from net investment income
|
-
|
(.23)
|
-
|
-
H
|
(.04)
|
Distributions from net realized gain
|
-
|
-
|
-
|
(.01
)
|
-
|
Total distributions
|
-
|
(.23
)
|
-
|
(.01
)
|
(.04
)
|
Net asset value, end of period
|
$ 45.65
|
$ 32.40
|
$ 33.24
|
$ 27.26
|
$ 22.70
|
Total Return
A,B
|
40.90%
|
(1.76)%
|
21.94%
|
20.13%
|
(35.06)%
|
Ratios to Average Net Assets
D,G
|
|
|
|
|
|
Expenses before reductions
|
1.85%
|
1.87%
|
1.86%
|
1.89%
|
1.94%
|
Expenses net of fee waivers, if any
|
1.85%
|
1.87%
|
1.86%
|
1.89%
|
1.94%
|
Expenses net of all reductions
|
1.85%
|
1.86%
|
1.86%
|
1.89%
|
1.94%
|
Net investment income (loss)
|
.33%
F
|
(.41)%
|
(.97)%
|
(.56)%
|
.53%
|
Supplemental Data
|
|
|
|
|
|
Net assets, end of period (in millions)
|
$ 527
|
$ 405
|
$ 522
|
$ 525
|
$ 496
|
Portfolio turnover rate
E
|
17%
|
30%
|
18%
|
22%
|
45%
|
A
Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
B
Total returns do not include the effect of the contingent deferred sales charge.
C
Calculated based on average shares outstanding during the period.
D
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.
E
Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
F
Investment income per share reflects a large, non-recurring dividend which amounted to $.09 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .10%.
G
Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage
service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
H
Amount represents less than $.01 per share.
See accompanying notes which are an integral part of the financial statements.
Annual Report
Financial Highlights - Institutional Class
Years ended July 31,
|
2013
|
2012
|
2011
|
2010
|
2009
|
Selected Per-Share Data
|
|
|
|
|
|
Net asset value, beginning of period
|
$ 34.77
|
$ 35.44
|
$ 28.90
|
$ 23.97
|
$ 36.85
|
Income from Investment Operations
|
|
|
|
|
|
Net investment income (loss)
B
|
.57
E
|
.20
|
.02
|
.13
|
.33
|
Net realized and unrealized gain (loss)
|
14.13
|
(.52
)
|
6.67
|
4.96
|
(13.06
)
|
Total from investment operations
|
14.70
|
(.32
)
|
6.69
|
5.09
|
(12.73
)
|
Distributions from net investment income
|
(.08)
|
(.35)
|
(.05)
F
|
(.15)
|
(.15)
|
Distributions from net realized gain
|
-
|
-
|
(.10
)
F
|
(.01
)
|
-
|
Total distributions
|
(.08
)
|
(.35
)
|
(.15
)
|
(.16
)
|
(.15
)
|
Net asset value, end of period
|
$ 49.39
|
$ 34.77
|
$ 35.44
|
$ 28.90
|
$ 23.97
|
Total Return
A
|
42.34%
|
(.77)%
|
23.21%
|
21.30%
|
(34.38)%
|
Ratios to Average Net Assets
C,G
|
|
|
|
|
|
Expenses before reductions
|
.84%
|
.86%
|
.85%
|
.87%
|
.93%
|
Expenses net of fee waivers, if any
|
.84%
|
.86%
|
.85%
|
.87%
|
.93%
|
Expenses net of all reductions
|
.84%
|
.85%
|
.85%
|
.87%
|
.93%
|
Net investment income (loss)
|
1.34%
E
|
.60%
|
.04%
|
.46%
|
1.54%
|
Supplemental Data
|
|
|
|
|
|
Net assets, end of period (in millions)
|
$ 965
|
$ 631
|
$ 694
|
$ 710
|
$ 561
|
Portfolio turnover rate
D
|
17%
|
30%
|
18%
|
22%
|
45%
|
A
Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
B
Calculated based on average shares outstanding during the period.
C
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.
D
Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
E
Investment income per share reflects a large, non-recurring dividend which amounted to $.10 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 1.11%.
F
The amounts shown reflect certain reclassifications related to book to tax differences that were made in the year shown.
G
Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage
service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
See accompanying notes which are an integral part of the financial statements.
Annual Report
Notes
to
Financial Statements
For the period ended July 31, 2013
(Amounts in thousands except percentages)
1. Organization.
Fidelity Advisor Leveraged Company Stock Fund (the Fund) is a fund of Fidelity Advisor Series I (the Trust) and is authorized to issue an
unlimited number of shares. The Trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end
management investment company organized as a Massachusetts business trust. In June 2013, the Board of Trustees of the Fund approved the
creation of an additional class of shares. The Fund commenced sale of Class Z on August 13, 2013. The Fund offers Class A, Class T, Class C and
Institutional Class shares, each of which, along with Class B shares, has equal rights as to assets and voting privileges. Class B shares are
closed to new accounts and additional purchases, except for exchanges and reinvestments. Each class has exclusive voting rights with respect
to matters that affect that class. Class B shares will automatically convert to Class A shares after a holding period of seven years from the
initial date of purchase.
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 Fidelity Management & Research Company (FMR) and its affiliates. The Fund's Schedule of Investments lists
each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of
each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity
Central Funds.
The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of FMR.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission
(the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds, which are not covered by the Fund's
Report of Independent Registered Public Accounting Firm, 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:
Annual Report
Notes to Financial Statements - continued
(Amounts in thousands except percentages)
3. Significant Accounting Policies - continued
Investment Valuation.
Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. In accordance with
valuation policies and procedures approved by the Board of Trustees (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 FMR Fair Value Committee (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 is responsible for approving
and reporting to the Board all fair value determinations.
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 restricted equity
securities and private placements where observable inputs are limited, assumptions about market activity and risk are used and these securities are generally categorized as Level 3 in the hierarchy.
Annual Report
3. Significant Accounting Policies - continued
Investment Valuation - continued
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. For corporate bonds and floating rate loans, pricing vendors utilize matrix pricing which
considers yield or price of bonds of comparable quality, coupon, maturity and type as well as 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 July 31, 2013, 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
Annual Report
Notes to Financial Statements - continued
(Amounts in thousands except percentages)
3. Significant Accounting Policies - continued
Investment Transactions and Income - continued
ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Non-cash dividends included
in dividend income, if any, are recorded at the fair market value of the securities received. 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. Large, non-recurring dividends recognized by the Fund are presented separately on the Statement of Operations as "Special
Dividends" and the impact of these dividends is presented in the Financial Highlights. Interest income and distributions from the Fidelity
Central Funds are accrued as earned. Interest income includes coupon interest and amortization of premium and accretion of discount on
debt securities. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain. Debt obligations may
be placed on non-accrual status and related interest income may be reduced by ceasing current accruals and writing off interest receivables
when the collection of all or a portion of interest has become doubtful based on consistently applied procedures. A debt obligation is removed
from non-accrual status when the issuer resumes interest payments or when collectability of interest is reasonably assured.
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 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. 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 income taxes is required. As of July 31, 2013, the Fund did not have any unrecognized tax benefits in the financial statements;
nor is the Fund aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. A fund's
federal income tax returns are subject to examination by the
Annual Report
3. Significant Accounting Policies - continued
Income Tax Information and Distributions to Shareholders - continued
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. Temporary book-tax differences will reverse in a subsequent period.
Book-tax differences are primarily due to foreign currency transactions, market discount, equity-debt classifications, capital loss carryforwards 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
|
$ 1,310,830
|
Gross unrealized depreciation
|
(200,044
)
|
Net unrealized appreciation (depreciation) on securities and other investments
|
$ 1,110,786
|
|
|
Tax Cost
|
$ 3,042,191
|
The tax-based components of distributable earnings as of period end were as follows:
Undistributed ordinary income
|
$ 6,245
|
Capital loss carryforward
|
$ (358,992
)
|
Net unrealized appreciation (depreciation)
|
$ 1,110,786
|
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.
Annual Report
Notes to Financial Statements - continued
(Amounts in thousands except percentages)
3. Significant Accounting Policies - continued
Income Tax Information and Distributions to Shareholders - continued
The capital loss carryforward information presented below, including any applicable limitation, is estimated as of fiscal period end and is
subject to adjustment.
Fiscal year of expiration
|
|
2018
|
$ (358,992
)
|
The tax character of distributions paid was as follows:
|
July 31, 2013
|
July 31, 2012
|
Ordinary Income
|
$ 2,596
|
$ 28,865
|
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.
Loans and Other Direct Debt Instruments.
The Fund invests in direct debt instruments which are interests in amounts owed to lenders by
corporate or other borrowers. These instruments may be in the form of loans, trade claims or other receivables and may include standby
financing commitments such as revolving credit facilities that obligate the Fund to supply additional cash to the borrower on demand. Loans
may be acquired through assignment or participation, or may be made directly to a borrower. The Fund may be contractually obligated to
receive approval from the agent bank and/or borrower prior to the sale of these loans. The Fund did not have any unfunded loan commitments,
which are contractual obligations for future funding, at period end.
4. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities, aggregated $549,128 and $809,139, respectively.
5. Fees and Other Transactions with Affiliates.
Management Fee.
FMR and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly
management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .35% of the Fund's average
net assets and an annualized group fee rate that averaged .26% during the period. The group fee rate is based upon the average net assets of
all the
Annual Report
5. Fees and Other Transactions with Affiliates - continued
Management Fee - continued
mutual funds advised by FMR. The group fee rate decreases as assets under management increase and increases as assets under management
decrease. For the period, the total annual management fee rate was .61% of the Fund's average net assets.
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 FMR, separate Distribution and
Service Fees, each of which is based on an annual percentage of each class' average net assets. In addition, FDC may pay financial intermediaries for selling shares of the Fund and providing shareholder support services. For the period, the Distribution and Service Fee rates, total
fees and amounts retained by FDC were as follows:
|
Distribution
Fee
|
Service
Fee
|
Total Fees
|
Retained
by FDC
|
Class A
|
-%
|
.25%
|
$ 3,194
|
$ 157
|
Class T
|
.25%
|
.25%
|
4,347
|
47
|
Class B
|
.75%
|
.25%
|
831
|
631
|
Class C
|
.75%
|
.25%
|
4,554
|
540
|
|
|
|
$ 12,926
|
$ 1,375
|
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, Class B and Class C redemptions. The deferred sales charges range from 5.00% to 1.00% for
Class B shares, 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
|
$ 242
|
Class T
|
34
|
Class B
*
|
98
|
Class C
*
|
16
|
|
$ 390
|
*
When Class B and Class C shares are initially sold, FDC pays commissions from its own resources to financial intermediaries through which the sales are made.
Annual Report
Notes to Financial Statements - continued
(Amounts in thousands except percentages)
5. Fees and Other Transactions with Affiliates - continued
Transfer Agent Fees.
Fidelity Investments Institutional Operations Company, Inc., (FIIOC), an affiliate of FMR, is the transfer, dividend
disbursing and shareholder servicing agent for each class of the Fund. FIIOC receives account fees and asset-based fees that vary according to
the account size and type of account of the shareholders of the respective classes of the Fund. FIIOC pays for typesetting, printing and mailing
of shareholder reports, except proxy statements. For the period, transfer agent fees for each class were as follows:
|
Amount
|
% of
Average
Net Assets
|
Class A
|
$ 2,753
|
.22
|
Class T
|
1,678
|
.19
|
Class B
|
224
|
.27
|
Class C
|
949
|
.21
|
Institutional Class
|
1,492
|
.20
|
|
$ 7,096
|
|
Accounting and Security Lending Fees.
Fidelity Service Company, Inc. (FSC), an affiliate of FMR, maintains the Fund's accounting
records. The accounting fee is based on the level of average net assets for 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 $25 for the period.
6. Committed Line of Credit.
The Fund participates with other funds managed by FMR 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 and is reflected in Miscellaneous expenses on the Statement of Operations. During the period, there were no borrowings on this line of credit.
Annual Report
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. 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. At period end, there were no security loans outstanding with FCM. 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 $2,373, including $208 from securities
loaned to FCM.
8. Expense Reductions.
Commissions paid to certain brokers with whom FMR places trades on behalf of the Fund include an amount in addition to trade execution,
which is rebated back to the Fund to offset certain expenses. This amount totaled $134 for the period. In addition, through arrangements with
the Fund's custodian, credits realized as a result of uninvested cash balances were used to reduce the Fund's expenses. During the period,
these credits reduced the Fund's custody expenses by three hundred dollars.
9. Distributions to Shareholders.
Distributions to shareholders of each class were as follows:
Years ended July 31,
|
2013
|
2012
|
From net investment income
|
|
|
Class A
|
$ 1,121
|
$ 11,505
|
Class T
|
84
|
7,107
|
Class B
|
-
|
710
|
Class C
|
-
|
3,243
|
Institutional Class
|
1,391
|
6,300
|
Total
|
$ 2,596
|
$ 28,865
|
Annual Report
Notes to Financial Statements - continued
(Amounts in thousands except percentages)
10. Share Transactions.
Transactions for each class of shares were as follows:
|
Shares
|
Dollars
|
Years ended July 31,
|
2013
|
2012
|
2013
|
2012
|
Class A
|
|
|
|
|
Shares sold
|
7,818
|
6,791
|
$ 326,978
|
$ 220,746
|
Reinvestment of distributions
|
27
|
347
|
1,036
|
10,560
|
Shares redeemed
|
(9,447
)
|
(15,628
)
|
(384,545
)
|
(500,053
)
|
Net increase (decrease)
|
(1,602
)
|
(8,490
)
|
$ (56,531
)
|
$ (268,747
)
|
Class T
|
|
|
|
|
Shares sold
|
6,400
|
5,449
|
$ 261,455
|
$ 173,250
|
Reinvestment of distributions
|
2
|
222
|
79
|
6,629
|
Shares redeemed
|
(7,533
)
|
(9,652
)
|
(301,128
)
|
(304,171
)
|
Net increase (decrease)
|
(1,131
)
|
(3,981
)
|
$ (39,594
)
|
$ (124,292
)
|
Class B
|
|
|
|
|
Shares sold
|
34
|
32
|
$ 1,361
|
$ 953
|
Reinvestment of distributions
|
-
|
21
|
-
|
605
|
Shares redeemed
|
(874
)
|
(1,103
)
|
(33,817
)
|
(33,738
)
|
Net increase (decrease)
|
(840
)
|
(1,050
)
|
$ (32,456
)
|
$ (32,180
)
|
Class C
|
|
|
|
|
Shares sold
|
1,725
|
1,075
|
$ 69,238
|
$ 33,268
|
Reinvestment of distributions
|
-
|
88
|
-
|
2,548
|
Shares redeemed
|
(2,699
)
|
(4,363
)
|
(102,735
)
|
(132,599
)
|
Net increase (decrease)
|
(974
)
|
(3,200
)
|
$ (33,497
)
|
$ (96,783
)
|
Institutional Class
|
|
|
|
|
Shares sold
|
9,112
|
9,699
|
$ 385,989
|
$ 321,305
|
Reinvestment of distributions
|
29
|
165
|
1,155
|
5,095
|
Shares redeemed
|
(7,736
)
|
(11,315
)
|
(315,321
)
|
(367,381
)
|
Net increase (decrease)
|
1,405
|
(1,451
)
|
$ 71,823
|
$ (40,981
)
|
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.
Annual Report
To the Trustees of Fidelity Advisor Series I and the Shareholders of Fidelity Advisor Leveraged Company Stock Fund:
In our opinion, the accompanying statement of assets and liabilities, including the schedule of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of Fidelity Advisor
Leveraged Company Stock Fund (a fund of Fidelity Advisor Series I) at July 31, 2013, the results of its operations for the year then ended, the
changes in its net assets for each of the two years in the period then ended and the financial highlights for each of the five years in the period then
ended, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial
highlights (hereafter referred to as "financial statements") are the responsibility of the Fidelity Advisor Leveraged Company Stock Fund's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial
statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits,
which included confirmation of securities at July 31, 2013 by correspondence with the custodian, agent bank, and brokers, provide a reasonable
basis for our opinion.
PricewaterhouseCoopers LLP
Boston, Massachusetts
September 17, 2013
Annual Report
The Trustees, Member of the Advisory Board, and executive officers of the trust and fund, as applicable, are listed below. The Board of Trustees governs the fund and is responsible for protecting the interests of shareholders. The Trustees are experienced executives who meet
periodically throughout the year to oversee the fund's activities, review contractual arrangements with companies that provide services to the
fund, oversee management of the risks associated with such activities and contractual arrangements, and review the fund's performance.
Except for James C. Curvey, Ned C. Lautenbach, Ronald P. O'Hanley, and William S. Stavropoulos, each of the Trustees oversees 166 Fidelity
funds. Mr. Curvey oversees 387 Fidelity funds. Mr. Lautenbach, Mr. O'Hanley, and Mr. Stavropoulos each oversees 230 Fidelity funds.
The Trustees hold office without limit in time except that (a) any Trustee may resign; (b) any Trustee may be removed by written instrument,
signed by at least two-thirds of the number of Trustees prior to such removal; (c) any Trustee who requests to be retired or who has become
incapacitated by illness or injury may be retired by written instrument signed by a majority of the other Trustees; and (d) any Trustee may be
removed at any special meeting of shareholders by a two-thirds vote of the outstanding voting securities of the trust. Each Trustee who is not
an interested person of the trust and the fund (as defined in the 1940 Act) (Independent Trustee), shall retire not later than the last day of
the calendar year in which his or her 75th birthday occurs. The Independent Trustees may waive this mandatory retirement age policy with
respect to individual Trustees. The executive officers and Advisory Board Member hold office without limit in time, except that any officer and
Advisory Board Member may resign or may be removed by a vote of a majority of the Trustees at any regular meeting or any special meeting of
the Trustees. Except as indicated, each individual has held the office shown or other offices in the same company for the past five years.
Experience, Skills, Attributes, and Qualifications of the Fund's Trustees.
The Governance and Nominating Committee has adopted a
statement of policy that describes the experience, qualifications, attributes, and skills that are necessary and desirable for potential Independent Trustee candidates (Statement of Policy). The Board believes that each Trustee satisfied at the time he or she was initially elected or
appointed a Trustee, and continues to satisfy, the standards contemplated by the Statement of Policy. The Governance and Nominating
Committee also engages professional search firms to help identify potential Independent Trustee candidates who have the experience,
qualifications, attributes, and skills consistent with the Statement of Policy. From time to time, additional criteria based on the composition
and skills of the current Independent Trustees, as well as experience or skills that may be appropriate in light of future changes to board
composition, business conditions, and regulatory or other developments, have also been considered by the professional search firms and the
Governance and Nominating Committee. In addition, the Board takes into account the Trustees' commitment and participation in Board and
committee meetings, as well as their leadership of standing and ad hoc committees throughout their tenure.
Annual Report
In determining that a particular Trustee was and continues to be qualified to serve as a Trustee, the Board has considered a variety of criteria,
none of which, in isolation, was controlling. The Board believes that, collectively, the Trustees have balanced and diverse experience, qualifications, attributes, and skills, which allow the Board to operate effectively in governing the fund and protecting the interests of shareholders.
Information about the specific experience, skills, attributes, and qualifications of each Trustee, which in each case led to the Board's conclusion that the Trustee should serve (or continue to serve) as a trustee of the fund, is provided below.
Board Structure and Oversight Function.
James C. Curvey is an interested person (as defined in the 1940 Act) and currently serves as
Chairman. The Trustees have determined that an interested Chairman is appropriate and benefits shareholders because an interested
Chairman has a personal and professional stake in the quality and continuity of services provided to the fund. Independent Trustees exercise
their informed business judgment to appoint an individual of their choosing to serve as Chairman, regardless of whether the Trustee happens
to be independent or a member of management. The Independent Trustees have determined that they can act independently and effectively
without having an Independent Trustee serve as Chairman and that a key structural component for assuring that they are in a position to do so
is for the Independent Trustees to constitute a substantial majority for the Board. The Independent Trustees also regularly meet in executive
session. Ned C. Lautenbach serves as Chairman of the Independent Trustees and as such (i) acts as a liaison between the Independent
Trustees and management with respect to matters important to the Independent Trustees and (ii) with management prepares agendas for
Board meetings.
Fidelity funds are overseen by different Boards of Trustees. The fund's Board oversees Fidelity's equity and high income funds and another
Board oversees Fidelity's investment-grade bond, money market, and asset allocation funds. The asset allocation funds may invest in Fidelity
funds overseen by the fund's Board. The use of separate Boards, each with its own committee structure, allows the Trustees of each group of
Fidelity funds to focus on the unique issues of the funds they oversee, including common research, investment, and operational issues. On
occasion, the separate Boards establish joint committees to address issues of overlapping consequences for the Fidelity funds overseen by
each Board.
The Trustees operate using a system of committees to facilitate the timely and efficient consideration of all matters of importance to the
Trustees, the fund, and fund shareholders and to facilitate compliance with legal and regulatory requirements and oversight of the fund's
activities and associated risks. The Board, acting through its committees, has charged FMR and its affiliates with (i) identifying events or
circumstances the occurrence of which could have demonstrably adverse effects on the fund's business and/or reputation; (ii) implementing
processes and controls to lessen the possibility that such events or circumstances occur or to mitigate the effects of such events or circumstances if they do occur; and (iii) creating and maintaining a system designed to evaluate continuously business and market conditions in
order to facilitate the identification and implementation processes described in (i) and (ii) above. Because the day-to-day operations and
activities of the fund are carried out by or through FMR, its affiliates and other service providers, the fund's exposure to risks is mitigated but
not eliminated by the processes overseen by the Trustees. While each of the Board's committees has responsibility for overseeing different
aspects of the fund's activities, oversight is exercised primarily through the Operations, Audit, and Compliance Committees. In addition, the
Independent Trustees have worked with FMR to enhance the Board's oversight of investment and financial risks, legal and regulatory risks,
technology risks, and operational risks, including the development of additional risk reporting to the Board. For example, a working group
comprised of Independent Trustees and FMR has worked and continues to work to review the Fidelity funds' valuation-related activities,
reporting and risk management. Appropriate personnel, including but not limited to the fund's Chief Compliance Officer (CCO), FMR's
internal auditor, the independent accountants, the fund's Treasurer and portfolio management personnel, make periodic reports to the
Board's committees, as appropriate, including an annual review of FMR's risk management program for the Fidelity funds. The responsibilities of each standing committee, including their oversight responsibilities, are described further under "Standing Committees of the Fund's
Trustees."
Annual Report
Trustees and Officers - continued
The fund's Statement of Additional Information (SAI) includes more information about the Trustees. To request a free copy, call Fidelity at
1-877-208-0098.
Interested Trustees
*:
Correspondence intended for each Trustee who is an interested person may be sent to Fidelity Investments, 245 Summer Street, Boston,
Massachusetts 02210.
Name, Year of Birth; Principal Occupations and Other Relevant Experience
+
|
James C. Curvey (1935)
|
|
Year of Election or Appointment: 2007
Mr. Curvey is Trustee and Chairman of the Board of Trustees of certain Trusts. Mr. Curvey also serves as Trustee
(2007-present) of other investment companies advised by FMR. Mr. Curvey is a Director of Fidelity Investments Money
Management, Inc. (2009-present), Director of Fidelity Research & Analysis Co. (2009-present) and Director of FMR and
FMR Co., Inc. (2007-present). Mr. Curvey is also Vice Chairman (2007-present) and Director of FMR LLC. In addition,
Mr. Curvey serves as an Overseer for the Boston Symphony Orchestra and a member of the Trustees of Villanova
University. Previously, Mr. Curvey was the Vice Chairman (2006-2007) and Director (2000-2007) of FMR Corp.
|
Ronald P. O'Hanley (1957)
|
|
Year of Election or Appointment: 2011
Mr. O'Hanley serves as a Trustee and Chairman of the Board of Trustees of other Fidelity funds (2013-present), and is
Director of FMR Co., Inc. (2010-present), Director of Fidelity Investments Money Management, Inc. (2010-present),
Director of Fidelity Research & Analysis Company (2010-present), President of Fidelity Asset Management and
Corporate Services and a Member of Fidelity's Executive Committee (2010-present). Previously, Mr. O'Hanley served as President and Chief Executive Officer of BNY Mellon Asset Management
(2007-2010). Mr. O'Hanley also served as Vice Chairman of Bank New York Mellon Corp. and a member of that firm's
Executive Committee. Prior to the 2007 merger of The Bank of New York and Mellon Financial Corporation, he was
Vice Chairman of Mellon Financial Corporation and President and Chief Executive Officer of Mellon Asset
Management. He joined Mellon in February 1997. Mr. O'Hanley currently serves as Chairman of the Boston Public
Library Foundation Board of Directors and sits on the Board of Directors of Beth Israel Deaconess Medical Center, the
Board of Trustees of the Marine Biological Laboratory and the Advisory Board of the Maxwell School of Citizenship and
Public Administration at Syracuse University. Mr. O'Hanley also chairs the Council on Asset Management for the
Financial Services Roundtable and is a member of the Board of Directors of Institutional Investor's U.S. Institute.
|
* Trustees have been determined to be "Interested Trustees" by virtue of, among other things, their affiliation with the trust or various
entities under common control with FMR.
+
The information above includes each Trustee's principal occupation during the last five years and other information relating to the experience, attributes, and skills relevant to each Trustee's qualifications to serve as a Trustee, which led to the conclusion that each
Trustee should serve as a Trustee for the fund.
Annual Report
Trustees and Officers - continued
Independent Trustees
:
Correspondence intended for each Independent Trustee (that is, the Trustees other than the Interested Trustees) may be sent to Fidelity
Investments, P.O. Box 55235, Boston, Massachusetts 02205-5235.
Name, Year of Birth; Principal Occupations and Other Relevant Experience
+
|
Dennis J. Dirks (1948)
|
|
Year of Election or Appointment: 2005
Prior to his retirement in May 2003, Mr. Dirks was Chief Operating Officer and a member of the Board of The
Depository Trust & Clearing Corporation (DTCC). He also served as President, Chief Operating Officer, and Board
member of The Depository Trust Company (DTC) and President and Board member of the National Securities Clearing
Corporation (NSCC). In addition, Mr. Dirks served as Chief Executive Officer and Board member of the Government
Securities Clearing Corporation, Chief Executive Officer and Board member of the Mortgage-Backed Securities Clearing
Corporation, as a Trustee and a member of the Finance Committee of Manhattan College (2005-2008), and as a
Trustee and a member of the Finance Committee of AHRC of Nassau County (2006-2008). Mr. Dirks is a member of the
Independent Directors Council (IDC) Governing Council (2010-present) and Board of Directors for The Brookville Center
for Children's Services, Inc. (2009-present).
|
Alan J. Lacy (1953)
|
|
Year of Election or Appointment: 2008
Mr. Lacy serves as Senior Adviser (2007-present) of Oak Hill Capital Partners, L.P. (private equity). Mr. Lacy also served
as Chief Executive Officer (2000-2005) and Vice Chairman (2005-2006) of Sears Holdings Corporation and Sears,
Roebuck and Co. (retail). In addition, Mr. Lacy serves as a member of the Board of Directors of Dave & Buster's
Entertainment, Inc. (restaurant and entertainment complexes, 2010-present), Earth Fare, Inc. (retail grocery, 2012-present), The Hillman Companies, Inc. (hardware wholesalers,
2010-present), and Bristol-Myers Squibb Company (global pharmaceuticals, 2008-present). Mr. Lacy is a member of
the Board of Trustees of The National Parks Conservation Association (2006-present). Previously, Mr. Lacy served as
Chairman of the Board of Trustees of the National Parks Conservation Association (2008-2011) and as a member of the
Board of Directors for the Western Union Company (global money transfer, 2006-2011).
|
Ned C. Lautenbach (1944)
|
|
Year of Election or Appointment: 2000
Mr. Lautenbach is Chairman of the Independent Trustees of the Equity and High Income Funds (2006-present) and
serves as a Trustee of other Fidelity funds (2013-present). Mr. Lautenbach currently serves as the Lead Director of the
Eaton Corporation Board of Directors (diversified industrial, 1997-present). Mr. Lautenbach is Chairman of the Board of
Directors of the Philharmonic Center for the Arts in Naples, Florida (2012-present) and a member of the Council on
Foreign Relations (1994-present). Previously, Mr. Lautenbach was a Partner/Advisory Partner at Clayton, Dubilier &
Rice, LLC (private equity investment, 1998-2010), as well as a Director of Sony Corporation (2006-2007).
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Joseph Mauriello (1944)
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Year of Election or Appointment: 2008
Prior to his retirement in January 2006, Mr. Mauriello served in numerous senior management positions including
Deputy Chairman and Chief Operating Officer (2004-2005), and Vice Chairman of Financial Services (2002-2004) of
KPMG LLP US (professional services, 1965-2005). Mr. Mauriello currently serves as a member of the Board of Directors
of XL Group plc. (global insurance and re-insurance, 2006-present). Previously, Mr. Mauriello served as a Director of
the Hamilton Funds of the Bank of New York (2006-2007) and of Arcadia Resources Inc. (health care services and
products, 2007-2012).
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Robert W. Selander (1950)
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Year of Election or Appointment: 2011
Previously, Mr. Selander served as a Member of the Advisory Board of Fidelity's Equity and High Income Funds (2011),
Executive Vice Chairman (2010), Chief Executive Officer (2009-2010), and President and Chief Executive Officer
(1997-2009) of Mastercard, Inc.
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Cornelia M. Small (1944)
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Year of Election or Appointment: 2005
Ms. Small is a member of the Board of Directors (2009-present) and Chair of the Investment Committee (2010-present)
of the Teagle Foundation. Ms. Small also serves on the Investment Committee of the Berkshire Taconic Community
Foundation (2008-present). Previously, Ms. Small served as Chairperson (2002-2008) and a member of the Investment
Committee and Chairperson (2008-2012) and a member of the Board of Trustees of Smith College. In addition, Ms.
Small served as Chief Investment Officer, Director of Global Equity Investments, and a member of the Board of Directors
of Scudder, Stevens & Clark and Scudder Kemper Investments.
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William S. Stavropoulos (1939)
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Year of Election or Appointment: 2002
Mr. Stavropoulos is Vice Chairman of the Independent Trustees of the Equity and High Income Funds (2006-present) and
serves as a Trustee of other Fidelity funds (2013-present). Mr. Stavropoulos serves as President and Founder of the
Michigan Baseball Foundation, the Great Lakes Loons (2007-present). Mr. Stavropoulos is Chairman Emeritus of the
Board of Directors of The Dow Chemical Company, where he previously served in numerous senior management
positions, including President, CEO (1995-2000; 2002-2004), Chairman of the Executive Committee (2000-2006), and
as a member of the Board of Directors (1990-2006). Currently, Mr. Stavropoulos is Chairman of the Board of Directors
of Univar Inc. (global distributor of commodity and specialty chemicals), a Director of Teradata Corporation (data
warehousing and technology solutions), and Maersk Inc. (industrial conglomerate), and a member of the Advisory
Board for Metalmark Capital LLC (private equity investment, 2005-present). Mr. Stavropoulos is an operating advisor to
Clayton, Dubilier & Rice, LLC (private equity investment). In addition, Mr. Stavropoulos is a member of the University of
Notre Dame Advisory Council for the College of Science, a Trustee of the Rollin L. Gerstacker Foundation, and a
Director of the Naples Philharmonic Center for the Arts. Previously, Mr. Stavropoulos served as a Director of Chemical
Financial Corporation (bank holding company, 1993-2012) and Tyco International, Ltd. (multinational manufacturing
and services, 2007-2012).
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David M. Thomas (1949)
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Year of Election or Appointment: 2008
Previously, Mr. Thomas served as Executive Chairman (2005-2006) and Chairman and Chief Executive Officer
(2000-2005) of IMS Health, Inc. (pharmaceutical and healthcare information solutions), and a Director of Fortune
Brands, Inc. (consumer products, 2000-2011). In addition, Mr. Thomas serves as Non-Executive Chairman of the Board
of Directors of Fortune Brands Home and Security (home and security products, 2011-present), and as a member of the Board of Directors of Interpublic Group of Companies, Inc. (marketing
communication, 2004-present).
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+
The information above includes each Trustee's principal occupation during the last five years and other information relating to the experience, attributes, and skills relevant to each Trustee's qualifications to serve as a Trustee, which led to the conclusion that each
Trustee should serve as a Trustee for the fund.
Annual Report
Advisory Board Member and Executive Officers
:
Correspondence intended for each executive officer and Peter S. Lynch may be sent to Fidelity Investments, 245 Summer Street, Boston,
Massachusetts 02210.
Name, Year of Birth; Principal Occupation
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Peter S. Lynch (1944)
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Year of Election or Appointment: 2003
Member of the Advisory Board of Fidelity's Equity and High Income Funds. Mr. Lynch is Vice Chairman and a Director
of FMR and FMR Co., Inc. In addition, Mr. Lynch serves as a Trustee of Boston College and as the Chairman of the
Inner-City Scholarship Fund. Previously, Mr. Lynch served on the Special Olympics International Board of Directors
(1997-2006).
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Kenneth B. Robins (1969)
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Year of Election or Appointment: 2008
President and Treasurer of Fidelity's Equity and High Income Funds. Mr. Robins also serves as President and Treasurer
(2008-present) and Assistant Treasurer (2009-present) of other Fidelity funds and is an employee of Fidelity Investments
(2004-present). Mr. Robins serves as Executive Vice President of Fidelity Investments Money Management, Inc. (FIMM)
(2013-present). Previously, Mr. Robins served as Deputy Treasurer of the Fidelity funds (2005-2008) and Treasurer and
Chief Financial Officer of The North Carolina Capital Management Trust: Cash and Term Portfolios (2006-2008).
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Bruce T. Herring (1965)
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Year of Election or Appointment: 2006
Vice President of certain Equity Funds. Mr. Herring also serves as Vice President of other Fidelity funds (2013-present),
Chief Investment Officer of Fidelity Global Asset Allocation (GAA) (2013-present), Chief Investment Officer and Director
of Fidelity Management & Research (U.K.) Inc. (2010-present), Group Chief Investment Officer of FMR, and President of
Fidelity Research & Analysis Company (2010-present). Previously, Mr. Herring served as Vice President (2005-2006)
and Senior Vice President (2006-2007) of Fidelity Management & Research Company, Vice President of FMR Co., Inc.
(2001-2007) and as a portfolio manager for Fidelity U.S. Equity Funds.
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Brian B. Hogan (1964)
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Year of Election or Appointment: 2009
Vice President of Equity and High Income Funds. Mr. Hogan also serves as Vice President of other Fidelity funds
(2009-present) and President of FMR's Equity Division (2009-present). Previously, Mr. Hogan served as Senior Vice
President, Equity Research of FMR (2006-2009) and as a portfolio manager.
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Scott C. Goebel (1968)
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Year of Election or Appointment: 2008
Secretary and Chief Legal Officer (CLO) of the Fidelity funds. Mr. Goebel also serves as Secretary of Fidelity Investments
Money Management, Inc. (FIMM) (2010-present) and Fidelity Research and Analysis Company (FRAC) (2010-present);
Secretary and CLO of The North Carolina Capital Management Trust: Cash and Term Portfolios (2008-present); General Counsel, Secretary, and Senior Vice President of FMR (2008-present) and FMR Co., Inc.
(2008-present); employed by FMR LLC or an affiliate (2001-present); Chief Legal Officer of Fidelity Management &
Research (Hong Kong) Limited (2008-present) and Assistant Secretary of Fidelity Management & Research (Japan) Inc.
(2008-present), and Fidelity Management & Research (U.K.) Inc. (2008-present). Previously, Mr. Goebel served as Assistant Secretary of FIMM (2008-2010), FRAC (2008-2010), and the
Funds (2007-2008) and as Vice President and Secretary of Fidelity Distributors Corporation (FDC) (2005-2007).
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William C. Coffey (1969)
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Year of Election or Appointment: 2009
Assistant Secretary of Fidelity's Equity and High Income Funds. Mr. Coffey also serves as Assistant Secretary of other
Fidelity funds (2009-present), Senior Vice President and Deputy General Counsel of FMR LLC (2010-present), and is an
employee of Fidelity Investments. Previously, Mr. Coffey served as Vice President and Associate General Counsel of FMR
LLC (2005-2009).
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Elizabeth Paige Baumann (1968)
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Year of Election or Appointment: 2012
Anti-Money Laundering (AML) Officer of the Fidelity funds. Ms. Baumann also serves as AML Officer of The North
Carolina Capital Management Trust: Cash and Term Portfolios (2012-present), Chief AML Officer of FMR LLC
(2012-present), and is an employee of Fidelity Investments. Previously, Ms. Baumann served as Vice President and
Deputy Anti-Money Laundering Officer (2007-2012).
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Christine Reynolds (1958)
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Year of Election or Appointment: 2008
Chief Financial Officer of the Fidelity funds. Ms. Reynolds became President of Fidelity Pricing and Cash Management
Services (FPCMS) in August 2008. Ms. Reynolds served as Chief Operating Officer of FPCMS (2007-2008). Previously,
Ms. Reynolds served as President, Treasurer, and Anti-Money Laundering officer of the Fidelity funds (2004-2007).
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Joseph A. Hanlon (1968)
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Year of Election or Appointment: 2012
Chief Compliance Officer of Fidelity's Equity and High Income Funds. Mr. Hanlon also serves as Chief Compliance
Officer of other Fidelity funds (2012-present). Mr. Hanlon serves as Compliance Officer of FMR, FMR Co., Inc., Fidelity
Investments Money Management, Inc. (FIMM), Fidelity Research and Analysis Company (FRAC), and Fidelity
Management & Research (Hong Kong) (2009-present), as Senior Vice President of the Fidelity Asset Management
Division (2009-present), and is an employee of Fidelity Investments. Previously, Mr. Hanlon served as Compliance
Officer of Fidelity Management & Research (Japan) Inc. (2009-2013), Strategic Advisers, Inc. (2009-2013), and
Fidelity Management & Research (U.K.) Inc. (2009-2013).
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Joseph F. Zambello (1957)
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Year of Election or Appointment: 2011
Deputy Treasurer of the Fidelity funds. Mr. Zambello is an employee of Fidelity Investments. Previously, Mr. Zambello
served as Vice President of FMR's Program Management Group (2009-2011) and Vice President of the Transfer Agent Oversight Group
(2005-2009).
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Adrien E. Deberghes (1967)
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Year of Election or Appointment: 2008
Deputy Treasurer of Fidelity's Equity and High Income Funds. Mr. Deberghes also serves as Vice President
(2011-present), Deputy Treasurer (2008-present), and Assistant Treasurer (2010-present) of other Fidelity funds, and is
an employee of Fidelity Investments (2008-present). Previously, Mr. Deberghes served as Senior Vice President of Mutual Fund Administration at State Street
Corporation (2007-2008), Senior Director of Mutual Fund Administration at Investors Bank & Trust (2005-2007), and
Director of Finance for Dunkin' Brands (2000-2005).
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Stephen Sadoski (1971)
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Year of Election or Appointment: 2012
Deputy Treasurer of Fidelity's Equity and High Income Funds. Mr. Sadoski also serves as Deputy Treasurer of other
Fidelity funds (2012-present) and is an employee of Fidelity Investments (2012-present). Previously, Mr. Sadoski served as Assistant Treasurer
of Fidelity's Fixed Income and Asset Allocation Funds (2012-2013), an assistant chief accountant in the Division of
Investment Management of the Securities and Exchange Commission (SEC) (2009-2012) and as a senior manager at
Deloitte & Touche LLP (1997-2009).
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Stacie M. Smith (1974)
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Year of Election or Appointment: 2013
Deputy Treasurer of Fidelity's Equity and High Income Funds. Ms. Smith also serves as Deputy Treasurer of other Fidelity
funds (2013-present) and is an employee of Fidelity Investments (2009-present). Previously, Ms. Smith served as Senior
Audit Manager of Ernst & Young LLP (1996-2009).
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Stephanie J. Dorsey (1969)
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Year of Election or Appointment: 2010
Assistant Treasurer of Fidelity's Equity and High Income Funds. Ms. Dorsey also serves as President and Treasurer
(2013-present) and Assistant Treasurer (2010-present) of other Fidelity funds, Treasurer and Chief Financial Officer of
The North Carolina Capital Management Trust: Cash and Term Portfolios (2013-present), and is an employee of Fidelity
Investments (2008-present). Previously, Ms. Dorsey served as Deputy Treasurer of Fidelity's Fixed Income and Asset
Allocation Funds (2008-2013), Treasurer (2004-2008) of the JPMorgan Mutual Funds and Vice President (2004-2008) of JPMorgan Chase
Bank.
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Gary W. Ryan (1958)
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Year of Election or Appointment: 2005
Assistant Treasurer of the Fidelity funds. Mr. Ryan is an employee of Fidelity Investments. Previously, Mr. Ryan served as
Vice President of Fund Reporting in Fidelity Pricing and Cash Management Services (FPCMS) (1999-2005).
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Jonathan Davis (1968)
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Year of Election or Appointment: 2010
Assistant Treasurer of the Fidelity funds. Mr. Davis is also Assistant Treasurer of Fidelity Rutland Square Trust II and
Fidelity Commonwealth Trust II. Mr. Davis is an employee of Fidelity Investments. Previously, Mr. Davis served as Vice
President and Associate General Counsel of FMR LLC (2003-2010).
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Annual Report
Institutional Class designates 100% of the dividends distributed during the fiscal year as qualifying for the dividends-received deduction for
corporate shareholders.
Institutional Class designates 100% of the dividends distributed during the fiscal year as amounts which can be taken into account as a
dividend for the purposes of the maximum rate under section 1(h)(11) of the Internal Revenue Code.
The fund will notify shareholders in January 2014 of amounts for use in preparing 2013 income tax returns.
Annual Report
Board
Approval
of Investment Advisory Contracts and Management Fees
Fidelity Advisor Leveraged Company Stock Fund
Each year, the Board of Trustees, including the Independent Trustees (together, the Board), votes on the renewal of the management contract and 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, 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 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 the Fidelity funds.
At its July 2013 meeting, the Board, including the Independent Trustees, 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 relationship with the fund; (iv) the extent to which economies of scale exist and would be realized as the fund
grows; and (v) whether fee levels reflect these economies of scale, if any, for the benefit of 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 in the fund have a broad range of investment choices available to them, including a wide choice
among mutual 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 a part of the Fidelity
family of funds.
Annual Report
Nature, Extent, and Quality of Services Provided.
The Board considered the staffing within the investment adviser, Fidelity Management & Research Company (FMR), and the sub-advisers (together, the Investment Advisers) as it relates to the fund, including the backgrounds of the fund's investment personnel, 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 portfolio manager compensation program and whether this structure provides appropriate incentives
to act in the best interests of the fund.
Resources Dedicated to Investment Management and Support Services
. The Board and the Fund Oversight and Research Committees reviewed the general qualifications and capabilities of the Investment Advisers' investment staff, including its size, education, experience, and
resources, as well as the Investment Advisers' approach to recruiting, training, managing, and compensating investment personnel. The
Board noted that FMR 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 believes
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 the Investment Advisers' trading and risk management capabilities and resources, which are an integral part 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 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 and subcustodians; 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.
Annual Report
Board Approval of Investment Advisory Contracts and
Management Fees - continued
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.
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) persisting in efforts to enhance Fidelity's
global research capabilities; (iii) launching new funds and making other enhancements to meet client needs for global and income-oriented
solutions; (iv) 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; (v) rationalizing product lines and gaining
increased efficiencies through the mergers of several funds into other funds; (vi) strengthening Fidelity's index fund offerings by reducing
investment minimums and adopting or lowering existing expense caps for certain funds and classes; (vii) enhancing Global Asset Allocation
product offerings by launching new funds and strategies, including "open architecture" target date funds that utilize affiliated and unaffiliated sub-advisers; (viii) modifying the eligibility criteria for Institutional Class shares of Advisor funds to increase their marketability to a
portion of the defined contribution plan market; (ix) creating a new low-cost retirement share class for certain Advisor funds to appeal to
large retirement plans; (x) transitioning the management of certain Fidelity commodity funds to Geode Capital Management LLC, a registered commodity pool operator, while retaining administrative responsibilities for the funds; (xi) reorganizing a number of funds; and (xii)
taking steps toward establishing a new Fidelity adviser to manage sector-based funds and products.
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 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 periodically considers annualized return information for the fund, for different time periods, measured against
a
securities market index ("benchmark index") and a peer group of mutual funds with similar objectives ("peer group"). 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 the Investment Advisers' explanations for any overperformance or underperformance.
Annual Report
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 classes, where applicable, compared to appropriate benchmark indices, over appropriate time periods which 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; tactical opportunities for investment;
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 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) and 75th percentile (bottom of
box) of the peer universe.
Annual Report
Board Approval of Investment Advisory Contracts and
Management Fees - continued
Fidelity Advisor Leveraged Company Stock Fund
Based on its review, the Board concluded that the nature, extent, and quality of services provided to the fund under the Advisory Contracts
should benefit the fund's shareholders.
Competitiveness of Management Fee and Total Expense Ratio.
The Board considered the fund's management fee and total expense
ratio compared to "mapped groups" of competitive funds and classes. Fidelity creates "mapped groups" by combining similar Lipper investment objective categories that have comparable management fee characteristics. Combining Lipper investment objective categories aids the
Board's management fee and total expense ratio comparisons by broadening the competitive group used for comparison and by reducing the
number of universes to which various Fidelity funds are compared.
Management Fee
. The Board considered two proprietary management fee comparisons for the 12-month periods shown in the chart below.
The group of Lipper funds used by the Board for management fee comparisons is referred to below as the "Total Mapped Group." The Total
Mapped Group comparison focuses on a fund's standing in terms of gross management fees before expense reimbursements or caps relative to
the total universe of funds with comparable investment mandates, regardless of whether their management fee structures also are comparable. Funds with comparable investment mandates offer exposure to similar types of securities. Funds with comparable management fee
structures have similar management fee contractual arrangements (
e.g.
, flat rate charged for advisory services, all-inclusive fee rate,
etc.
).
"TMG %" represents the percentage of funds in the Total Mapped Group that had management fees that were lower than the fund's. For
example, a TMG % of 18% means that 82% of the funds in the Total Mapped Group had higher management fees than the fund. The "Asset-Size
Peer Group" (ASPG) comparison focuses on a fund's standing relative to a subset of non-Fidelity funds within the Total Mapped Group that
are similar in size and management fee structure. The ASPG represents at least 15% of the funds in the Total Mapped Group with comparable
asset size and management fee structures, subject to a minimum of 50 funds (or all funds in the Total Mapped Group if fewer than 50). Additional information, such as the ASPG quartile in which the fund's management fee ranked, is also included in the chart and considered by the
Board.
Annual Report
Fidelity Advisor Leveraged Company Stock Fund
The Board noted that the fund's management fee ranked below the median of its Total Mapped Group and below the median of its ASPG for
2012.
Based on its review, the Board concluded that the fund's management fee is fair and reasonable in light of the services that the fund receives
and the other factors considered.
Total Expense Ratio
. In its review of each class's total expense ratio, the Board considered the fund's management fee as well as other fund or
class expenses, as applicable, such as transfer agent fees, pricing and bookkeeping fees, fund-paid 12b-1 fees, and custodial, legal, and audit
fees. The Board also noted the effects of any waivers and reimbursements on fees and expenses. As part of its review, the Board also considered the current and historical total expense ratios of each class of the fund compared to competitive fund median expenses. Each class of the
fund is compared to those funds and classes in the Total Mapped Group (used by the Board for management fee comparisons) that have a
similar sales load structure.
Annual Report
Board Approval of Investment Advisory Contracts and
Management Fees - continued
The Board noted that the total expense ratio of each of Class A, Class B, Class C, and Institutional Class ranked below its competitive median
for 2012 and the total expense ratio of Class T ranked above its competitive median for 2012. The Board considered that, in general, various
factors can affect total expense ratios. The Board noted that the total expense ratio of Class T was above the competitive median primarily
because of higher 12b-1 fees on Class T. Class T has a higher 12b-1 fee, but a lower front-end sales charge, than traditionally priced front-end
sales charge classes. The Board considered that Class T is primarily sold load-waived in the retirement plan market where its 0.50% 12b-1 fee
is comparable to competing no-load, higher 12b-1 fee classes designed specifically for retirement plans. The Board noted that the fund offers
multiple classes, each of which has a different sales load and 12b-1 fee structure, and that the multiple structures are intended to offer a
range of pricing options for the intermediary market. The Board also noted that the total expense ratios of the classes vary primarily by the
level of their 12b-1 fees, although differences in transfer agent fees may also cause expenses to vary from class to class.
Fees Charged to Other Fidelity Clients
. The Board also considered Fidelity fee structures and other information with respect to clients of FMR
and its affiliates, such as other mutual funds advised or subadvised by FMR or its affiliates, pension plan clients, and other institutional
clients. The Board noted the findings of the 2013 ad hoc joint committee (created with the board of other Fidelity funds), which reviewed and
compared Fidelity's institutional investment advisory business with its business of providing services to the Fidelity funds, including the
differences in services provided, fees charged, and costs incurred, as well as competition in their respective marketplaces.
Based on its review of total expense ratios and fees charged to other Fidelity clients, the Board concluded that the total expense ratio of each
class of the fund was reasonable, although Class T was above the median of the universe presented for comparison, in light of the services that
the fund and its shareholders receive and the other factors considered.
Costs of the Services and Profitability.
The Board considered the revenues earned and the expenses incurred by Fidelity in conducting the
business of developing, marketing, distributing, managing, administering and servicing the fund and servicing the fund's shareholders. The
Board also considered the level of Fidelity's profits in respect of all the Fidelity funds.
On an annual basis, FMR presents to the Board Fidelity's profitability for the fund. Fidelity calculates the profitability for each fund, as well as
aggregate profitability for groups of Fidelity funds and all Fidelity funds, using a series of detailed revenue and cost allocation methodologies
which originate with the books and records of Fidelity on which Fidelity's audited financial statements are based. The Audit Committee of the
Board reviews any significant changes from the prior year's methodologies.
Annual Report
PricewaterhouseCoopers LLP (PwC), independent registered public accounting firm and auditor to Fidelity and certain Fidelity funds, has
been engaged annually by the Board as part of the Board's assessment of Fidelity's profitability analysis. PwC's engagement includes the
review and assessment of the methodologies used by Fidelity in determining the revenues and expenses attributable to Fidelity's mutual fund
business, and completion of agreed-upon procedures surrounding the mathematical accuracy of fund profitability and its conformity to
allocation methodologies. After considering PwC's reports issued under the engagement and information provided by Fidelity, the Board
concluded that while other allocation methods may also be reasonable, Fidelity's profitability methodologies are reasonable in all material
respects.
The Board also reviewed Fidelity's non-fund businesses and fall-out benefits related to the mutual fund business as well as cases where
Fidelity's affiliates may benefit from or be related to the fund's business.
The Board considered the costs of the services provided by and the profits realized by Fidelity in connection with the operation of the fund and
was satisfied that the profitability was not excessive in the circumstances.
Economies of Scale.
The Board considered whether there have been economies of scale in respect of the management of the Fidelity funds,
whether the Fidelity funds (including the fund) have appropriately benefited from any such economies of scale, and whether there is potential for realization of any further economies of scale. The Board considered the extent to which the fund will benefit from economies of scale
through increased services to the fund, through waivers or reimbursements, or through fee or expense reductions. The Board also noted that
in 2009, it and the board of other Fidelity funds created an ad hoc committee (the Economies of Scale Committee) to analyze whether FMR
attains economies of scale in respect of the management and servicing of the Fidelity funds, whether the Fidelity funds have appropriately
benefited from such economies of scale, and whether there is potential for realization of any further economies of scale.
The Board recognized that the fund's management contract incorporates a "group fee" structure, which provides for lower group fee rates as
total fund assets under FMR's management increase, and for higher group fee rates as total fund assets under FMR's management decrease.
FMR calculates the group fee rates based on a tiered asset "breakpoint" schedule that varies based on asset class. The Board considered that
the group fee is designed to deliver the benefits of economies of scale to fund shareholders when total Fidelity fund assets increase, even if
assets of any particular fund are unchanged or have declined, because some portion of Fidelity's costs are attributable to services provided to
all Fidelity funds, and all funds benefit if those costs can be allocated among more assets. The Board concluded that, given the group fee
structure, fund shareholders will benefit from lower management fees as assets under FMR's management increase at the fund complex level,
regardless of whether Fidelity achieves any such economies of scale.
Annual Report
Board Approval of Investment Advisory Contracts and
Management Fees - continued
The Board concluded, taking into account the analysis of the Economies of Scale Committee, that economies of scale, if any, are being appropriately shared between fund shareholders and Fidelity.
Amendment to Description of Group Fee Rate
. At its July 2013 meeting, the Board voted to approve an amendment to the fund's management
contract to modify the description of the "group fee rate" effective August 1, 2013. The Board noted that under the prior description in the
contract, the group fee rate was based on the average net assets of all registered investment companies with which FMR has management
contracts. Under the contract's tiered asset breakpoint schedule, the group fee rate is lower as total fund assets under FMR's management
increase, and higher as total fund assets under FMR's management decrease. The Board considered that the prior description would have
excluded the assets of 64 Fidelity sector funds from the group fee rate calculation once Fidelity SelectCo, LLC, an affiliate of FMR, assumed
management responsibilities for those funds. The Board noted that modifying the description of the group fee rate to continue to include the
assets of those 64 funds for purposes of determining group fee rate breakpoints would avoid an immediate adverse impact on the group fee
rate for any fund.
Additional Information Requested by the Board.
In order to develop fully the factual basis for consideration of the Fidelity funds'
Advisory Contracts, the Board requested and received additional information on certain topics, including: (i) fund performance trends and
Fidelity's long-term strategies for certain funds; (ii) the potential to further rationalize the Fidelity fund lineup with the possibility of achieving savings for the funds and Fidelity; (iii) the methodology with respect to competitive fund data and peer group classifications; (iv) the
arrangements with, and performance of, certain sub-advisers on behalf of the Fidelity funds, as well as certain proposed participating affiliate
arrangements; (v) the realization of fall-out benefits in certain Fidelity business units; (vi) Fidelity's group fee structures, including the
rationale for the individual fee rates of certain categories of funds and the definition of group assets; (vii) trends regarding industry use of
performance fee structures and the performance adjustment methodologies applicable to the Fidelity funds; (viii) additional competitive
analysis regarding the total expenses for certain classes; and (ix) fund profitability methodology, including Fidelity's cost allocation methodology, and the impact of certain factors on fund profitability results.
Based on its evaluation of all of the conclusions noted above, and after considering all factors it believed relevant, the Board ultimately
concluded that the advisory fee structures are fair and reasonable, and that the fund's Advisory Contracts should be renewed.
Annual Report
Investment Adviser
Fidelity Management & Research Company
Boston, MA
Investment Sub-Advisers
FMR Co., Inc.
Fidelity Management & Research
(U.K.) Inc.
Fidelity Management & Research
(Hong Kong) Limited
Fidelity Management & Research
(Japan) Inc.
General Distributor
Fidelity Distributors Corporation
Smithfield, RI
Transfer and Service Agents
Fidelity Investments Institutional
Operations Company, Inc.
Boston, MA
Fidelity Service Company, Inc.
Boston, MA
Custodian
JPMorgan Chase Bank
New York, NY
(Fidelity Investment logo)(registered trademark)
ALSFI-UANN-0913
1.786694.110