PROXY STATEMENT

SPECIAL MEETING OF SHAREHOLDERS OF
VARIABLE INSURANCE PRODUCTS FUND:
EQUITY-INCOME PORTFOLIO
GROWTH PORTFOLIO
HIGH INCOME PORTFOLIO
MONEY MARKET PORTFOLIO
OVERSEAS PORTFOLIO
VALUE PORTFOLIO

TO BE HELD ON NOVEMBER 17, 2004

This Proxy Statement is furnished in connection with a solicitation of proxies made by, and on behalf of, the Board of Trustees of Variable Insurance Products Fund (the trust) to be used at the Special Meeting of Shareholders of Equity-Income Portfolio, Growth Portfolio, High Income Portfolio, Money Market Portfolio, Overseas Portfolio, and Value Portfolio (the funds) and at any adjournments thereof (the Meeting), to be held on November 17, 2004 at 10:15 a.m. ET at 27 State Street, 10th Floor, Boston, Massachusetts 02109, an office of the trust and Fidelity Management & Research Company (FMR), the funds' investment adviser.

<R>The purpose of the Meeting is set forth in the accompanying Notice. The solicitation is being made primarily by the mailing of this Proxy Statement and the accompanying proxy or voting instruction form on or about September 20, 2004. Supplementary solicitations may be made by mail, telephone, telegraph, facsimile, electronic means or by personal interview by representatives of the trust. The expenses in connection with preparing this Proxy Statement and its enclosures and all solicitations will be paid by each class of each fund provided the expenses do not exceed each class's existing voluntary expense cap as follows:</R>

<R>Expenses exceeding each class's voluntary expense cap will be paid by FMR. The funds will reimburse insurance companies and others for their reasonable expenses in forwarding solicitation material to the beneficial owners of shares. The costs are allocated among the funds based upon the number of shareholder accounts in each fund.</R>

The following table summarizes the proposals applicable to each fund:

<R>The principal business address of FMR, each fund's investment adviser and administrator, and FMR Co., Inc. (FMRC), sub-adviser to Equity-Income Portfolio, Growth Portfolio, High Income Portfolio, Overseas Portfolio, and Value Portfolio is One Federal Street, Boston, Massachusetts 02110. The principal business address of Fidelity Distributors Corporation (FDC), each fund's principal underwriter and distribution agent, is 82 Devonshire Street, Boston, Massachusetts, 02109. The principal business address of Fidelity Investments Money Management, Inc. (FIMM), sub-adviser to Money Market Portfolio, is One Spartan Way, Merrimack, New Hampshire 03054. Fidelity Management & Research (U.K.) Inc. (FMR U.K.), located at 25 Lovat Lane, London, EC3R 8LL, England; Fidelity Management & Research (Far East) Inc. (FMR Far East), located at Shiroyama JT Mori Bldg. 4-3-1 Toranomon Minato-ku, Tokyo 105, Japan; and Fidelity Investments Japan Limited (FIJ), located at Shiroyama JT Trust Tower, 3-1, Toranomon 4-chome, Minato-ku, Tokyo, Japan 105-6019 are also sub-advisers to High Income Portfolio, Overseas Portfolio, and Value Portfolio. Fidelity International Investment Advisors (FIIA), located at Pembroke Hall, 42 Crow Lane, Pembroke HM19, Bermuda; and Fidelity International Investment Advisors (U.K.) Limited (FIIA(U.K.)L), located at 25 Cannon Street, London EC4M 5TA, England are also sub-advisers to High Income Portfolio, Money Market Portfolio, Overseas Portfolio, and Value Portfolio.</R>

If the enclosed proxy or voting instruction form is executed and returned, it may nevertheless be revoked at any time prior to its use by written notification received by the trust, by the execution of a later-dated proxy or voting instruction form or by attending the Meeting and voting in person.

<R>All proxies solicited by the Board of Trustees that are properly executed and received by the Secretary prior to the Meeting, and are not revoked, will be voted at the Meeting. Shares represented by such proxies will be voted in accordance with the instructions thereon. If no specification is made on a proxy or voting instruction form, it will be voted FOR the matters specified on the proxy or voting instruction form. All shares that are voted and votes to ABSTAIN will be counted towards establishing a quorum, but insurance company variable accounts may vote all of their shares in the same proportion as the voting instructions actually received from variable product owners. See page <Click Here> .</R>

If a quorum is not present at the Meeting, or if a quorum is present at the Meeting but sufficient votes to approve one or more of the proposed items are not received, or if other matters arise requiring shareholder attention, the persons named as proxy agents may propose one or more adjournments of the Meeting to permit further solicitation of proxies. Any such adjournment will require the affirmative vote of a majority of those shares present at the Meeting or represented by proxy. When voting on a proposed adjournment, the persons named as proxy agents will vote FOR the proposed adjournment all shares that they are entitled to vote with respect to each item, unless directed to vote AGAINST the item, in which case such shares will be voted AGAINST the proposed adjournment with respect to that item. A shareholder vote may be taken on one or more of the items in this Proxy Statement prior to such adjournment if sufficient votes have been received and it is otherwise appropriate.

<R>Shares of each class of each fund of the trust issued and outstanding as of July 31, 2004 are indicated in the following table:</R>

<R>To the knowledge of the trust, substantial (5% or more) record ownership of each fund and class on July 31, 2004 was as follows:</R>

<R>To the knowledge of the trust, no other shareholder owned of record or beneficially more than 5% of the outstanding shares of each class of the funds on that date.</R>

FMR has advised the trust that certain shares are registered to FMR or an FMR affiliate. To the extent that FMR or an FMR affiliate has discretion to vote, these shares will be voted at the Meeting FOR each proposal. Otherwise, these shares will be voted in accordance with the plan or agreement governing the shares. Although the terms of the plans and agreements vary, generally the shares must be voted either (i) in accordance with instructions received from shareholders or (ii) in accordance with instructions received from shareholders and, for shareholders who do not vote, in the same proportion as certain other shareholders have voted.

Shareholders of record at the close of business on September 20, 2004 will be entitled to vote at the Meeting. Each such shareholder will be entitled to one vote for each dollar of net asset value held on that date.

Shares of the trust are currently sold only to life insurance companies. Each company holds its shares in a separate account (the Variable Account), which serves as the funding vehicle for its variable insurance products. In accordance with its view of present applicable law, each company will vote its shares held in its respective Variable Account at the Special Meeting of Shareholders in accordance with instructions received from persons having a voting interest in the Variable Account. Those persons who have a voting interest at the close of business on September 20, 2004, will be entitled to submit instructions to their company.

Fund shares held in a Variable Account for which no timely instructions are received will be voted by the companies in proportion to the voting instructions that are received with respect to all contracts participating in a Variable Account. Voting instructions to abstain on any item to be voted upon will reduce the votes eligible to be cast.

Accordingly, if you wish to vote, you should complete the enclosed proxy card or voting instruction form as a participant in a Variable Account. All forms which are properly executed and received prior to the Meeting, and which are not revoked, will be voted as described above. If the enclosed voting instruction form is executed and returned, it may nevertheless be revoked at any time prior to the Meeting by written notification received by your company, by execution of a later-dated form received by your company, or by attending the Meeting and voting in person.

Only one copy of this Proxy Statement may be mailed to households, even if more than one person in a household is a shareholder of record. If you need additional copies of this Proxy Statement, please contact your Insurance Company Representative. If you do not want the mailing of this Proxy Statement to be combined with those for other members of your household, please contact your Insurance Company Representative.

<R> For a free copy of each fund's annual report for the fiscal year ended December 31, 2003 and semiannual report for the fiscal period ended June 30, 2004 call 1-800-544-5429 or write to FDC at 82 Devonshire Street, Boston, Massachusetts 02109. </R>

VOTE REQUIRED: Approval of Proposal 1 requires the affirmative vote of a "majority of the outstanding voting securities" of the entire trust. Approval of Proposal 2 requires the affirmative vote of a plurality of the shares of the entire trust voted in person or by proxy at the Meeting. Approval of Proposals 3 through 10 requires the affirmative vote of a "majority of the outstanding voting securities" of the appropriate fund. Under the Investment Company Act of 1940 (1940 Act), the vote of a "majority of the outstanding voting securities" means the affirmative vote of the lesser of (a) 67% or more of the voting securities present at the Meeting or represented by proxy if the holders of more than 50% of the outstanding voting securities are present or represented by proxy or (b) more than 50% of the outstanding voting securities.

1. TO AMEND THE DECLARATION OF TRUST TO ALLOW THE BOARD OF TRUSTEES, IF PERMITTED BY APPLICABLE LAW, TO AUTHORIZE FUND MERGERS WITHOUT SHAREHOLDER APPROVAL.

The Securities and Exchange Commission (SEC) has recently changed the rules for mutual fund mergers to reduce the need for affiliated funds to incur the expense of soliciting proxies when a merger does not raise significant issues for shareholders - for example, merging two small Fidelity funds, with the same portfolio manager, the same investment principles and the same fee structures in order to achieve economies of scale and thereby reduce fund expenses borne by shareholders. The rules still require the board of trustees (including a majority of non-interested trustees) to determine that any merger is in the best interest of the affiliated funds and will not dilute the interest of their existing shareholders. The new SEC rules also require shareholder approval by the acquired affiliated fund for mergers that could have a material impact on a shareholder, like changing a fundamental investment policy or increasing fund expenses (see below).

The fund's current Declaration of Trust was drafted to be consistent with the old SEC rules which required approval of all mergers between affiliated funds by the shareholders of the fund to be acquired. You are being asked now to approve an amendment to the Declaration of Trust (Article XII, Section 4.3), consistent with the new affiliated fund merger rules, to permit the Trustees in limited circumstances to authorize a fund's or class's merger or consolidation with, or sale of a fund's or class's assets to, another operating mutual fund without a shareholder vote. You are not being asked to approve any fund mergers at this time.

Shareholders have the right to vote on any Declaration of Trust amendment affecting their right to vote or on any matter submitted to the shareholders by the Trustees. On April 15, 2004, the Trustees approved the proposed amendment and also authorized its submission to the trust's shareholders for their approval at this Meeting.

The amendment will give the Trustees more flexibility and, subject to applicable requirements of Federal law, namely the 1940 Act, and Massachusetts law, broader authority to act. The amendment will not alter in any way the Trustees' existing fiduciary obligations to act with due care and in the shareholders' interests. Before using any new flexibility that the proposed amendment may afford, the Trustees must first consider the shareholders' interests and then act in accordance with such interests. Shareholders of an acquired affiliated fund will still be required to approve a merger that would result in a change of a fundamental investment policy, a material change to the terms of an investment management contract, the institution of, or an increase in, a 12b-1 fee or where the board of trustees of the surviving fund does not have a majority of non-interested trustees who were elected by the acquired fund's shareholders. Shareholder approval will also continue to be required for all mergers of non-affiliated funds.

Article XII, Section 4.3 of the Declaration of Trust addresses mergers, consolidations, and sales of fund assets. If approved, Article XII, Section 4.3 will be amended as follows (new language is underlined ; language to be deleted is [bracketed]):

ARTICLE XII
MISCELLANEOUS

Section 4.3. Merger, Consolidation, and Sale of Assets. Subject to applicable Federal and state law and except as otherwise provided in Section 4.4 below, the Trust or any Series or Class thereof may merge or consolidate with any other corporation, association, trust, or other organization or may sell, lease, or exchange all or a portion of the Trust property or Trust property allocated or belonging to such Series or Class, including its good will, upon such terms and conditions and for such consideration when and as authorized by the Trustees without the vote or consent of Shareholders [at any meeting of Shareholders called for such purpose by a Majority Shareholder Vote of the Trust or affected Series or Class, as the case may be]. Such transactions may be effected through share-for-share exchanges, transfers or sale of assets, shareholder in-kind redemptions and purchases, exchange offers, or any other method approved by the Trustees.

Section 4.4. Incorporation; Reorganization. Subject to applicable Federal and state law, the Trustees may without the vote or consent of Shareholders cause to be organized or assist in organizing a corporation or corporations under the laws of any jurisdiction or any other trust, partnership, limited liability company, association, or other organization to take over all or a portion of the Trust property or all or a portion of the Trust property allocated or belonging to such Series or Class or to carry on any business in which the Trust shall directly or indirectly have any interest, and to sell, convey and transfer the Trust property or the Trust property allocated or belonging to such Series or Class to any such corporation, trust, limited liability company, partnership, association, or organization in exchange for the shares or securities thereof or otherwise, and to lend money to, subscribe for the shares or securities of, and enter into any contracts with any such corporation, trust, partnership, limited liability company, association, or organization, or any corporation, partnership, limited liability company, trust, association, or organization in which the Trust or such Series holds or is about to acquire shares or any other interest. Subject to applicable Federal and state law, the Trustees may also cause a merger or consolidation between the Trust or any successor thereto or any Series or Class thereof and any such corporation, trust, partnership, limited liability company, association, or other organization. Nothing contained herein shall be construed as requiring approval of Shareholders for the Trustees to organize or assist in organizing one or more corporations, trusts, partnerships, limited liability companies, associations, or other organizations and selling, conveying, or transferring the Trust property or a portion of the Trust property to such organization or entities; provided, however, that the Trustees shall provide written notice to the affected Shareholders of any transaction whereby, pursuant to this Section 4.4, the Trust or any Series or Class thereof sells, conveys, or transfers all or a portion of its assets to another entity or merges or consolidates with another entity. Such transactions may be effected through share-for-share exchanges, transfers or sale of assets, shareholder in-kind redemptions and purchases, exchange offers, or any other method approved by the Trustees.

Conclusion. The Board of Trustees has concluded that the proposal will benefit the trust and its shareholders. The Trustees recommend voting FOR the proposal. The amended Declaration of Trust will become effective upon shareholder approval. If the proposal is not approved by shareholders of the trust, Article XII, Section 4.3 of the Declaration of Trust will remain unchanged.

2. TO ELECT A BOARD OF TRUSTEES.

<R>The purpose of this proposal is to elect a Board of Trustees of the trust. Pursuant to the provisions of the Declaration of Trust of the trust, the Trustees have determined that the number of Trustees shall be fixed at 14. It is intended that the enclosed proxy will be voted for the nominees listed below unless such authority has been withheld in the proxy. A nominee shall be elected immediately upon shareholder approval, unless he or she is proposed to begin service at a later date. It is proposed that Dennis J. Dirks and Cornelia M. Small begin serving as Trustee on or about January 1, 2005, replacing Ralph F. Cox and Donald J. Kirk, who are scheduled to retire at the end of 2004.</R>

<R>Except for Mr. Dirks and Ms. Small, all nominees named below are currently Trustees of the trust and have served in that capacity continuously since originally elected or appointed. Laura B. Cronin, George H. Heilmeier, and Robert L. Reynolds were selected by the trust's Governance and Nominating Committee (see page <Click Here> ) and were appointed to the Board on March 1, 2003, January 1, 2004, and March 1, 2003, respectively. Mr. Dirks and Ms. Small are currently Members of the Advisory Board of the trust. Mr. Dirks and Ms. Small were selected by the trust's Governance and Nominating Committee and were appointed as Members of the Advisory Board on July 1, 2004 and January 1, 2004, respectively.</R>

<R>Except for William O. McCoy, Mr. Dirks, and Ms. Small, each of the nominees oversees 293 funds advised by FMR or an affiliate. Mr. McCoy oversees 295 funds advised by FMR or an affiliate. Mr. Dirks and Ms. Small do not currently serve as Trustees of any fund advised by FMR or an affiliate; Mr. Dirks and Ms. Small are currently Members of the Advisory Board of each Fidelity fund.</R>

In the election of Trustees, those nominees receiving the highest number of votes cast at the Meeting, provided a quorum is present, shall be elected.

Interested Nominees *:

Correspondence intended for each nominee who is an "interested person" (as defined in the 1940 Act) may be sent to Fidelity Investments, 82 Devonshire Street, Boston, Massachusetts 02109.

* Nominees have been determined to be "interested" by virtue of, among other things, their affiliation with the trust or various entities under common control with FMR.

** Except as otherwise indicated, each individual has held the office shown or other offices in the same company for the last five years.

*** Edward C. Johnson 3d, Trustee, is Abigail P. Johnson's father.

Non-Interested Nominees :

Correspondence intended for each non-interested nominee (that is, the nominees other than the interested nominees) may be sent to Fidelity Investments, P. O. Box 55235, Boston, Massachusetts 02205-5235.

* Except as otherwise indicated, each individual has held the office shown or other offices in the same company for the last five years.

** Mr. Cook has advised the Board of Trustees that he intends to resign effective on or about December 31, 2004 to pursue other opportunities.

*** Scheduled to retire at the end of 2004 in accordance with policy that each non-interested Trustee retire no later than the last day of the calendar year in which his or her 72nd birthday occurs.

⁺ Nominated to serve as Trustee effective on or about January 1, 2005 following the retirement of Ralph F. Cox and Donald J. Kirk.

As of July 31, 2004 the nominees, Trustees and officers of the trust and each fund owned, in the aggregate, less than 1% of each fund's outstanding shares.

If elected, the Trustees will 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) a Trustee may be removed at any Special Meeting of shareholders by a two-thirds vote of the outstanding voting securities of the trust. In any event, each non-interested Trustee shall retire not later than the last day of the calendar year in which his or her 72nd birthday occurs. In case a vacancy shall for any reason exist, the remaining Trustees will fill such vacancy by appointing another Trustee, so long as, immediately after such appointment, at least two-thirds of the Trustees have been elected by shareholders. If, at any time, less than a majority of the Trustees holding office has been elected by the shareholders, the Trustees then in office will promptly call a shareholders' meeting for the purpose of electing a Board of Trustees. Otherwise, there will normally be no meeting of shareholders for the purpose of electing Trustees. The Advisory Board Members hold office without limit in time except that any 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.

<R>The trust's Board, which is currently composed of four interested and 10 non-interested Trustees, met 11 times during the fiscal year ended December 31, 2003. It is expected that the Trustees will meet at least 11 times a year at regularly scheduled meetings. For additional information on the committees of the funds' Trustees, refer to the section entitled "Standing Committees of the Funds' Trustees" beginning on page <Click Here> .</R>

The following table sets forth information describing the dollar range of equity securities beneficially owned by each nominee in each fund and in all funds in the aggregate within the same fund family overseen by the nominee as of June 30, 2004.

The following table sets forth information describing the compensation of each Trustee and Member of the Advisory Board for his or her services for the fiscal year ended December 31, 2003.

* Edward C. Johnson 3d, Abigail P. Johnson, Laura B. Cronin, Peter S. Lynch, and Robert L. Reynolds are interested persons and are compensated by FMR.

** Ms. Davis served on the Board of Trustees through December 31, 2003.

*** Effective July 1, 2004, Mr. Dirks serves as a Member of the Advisory Board.

**** During the period from March 1, 2003 through December 31, 2003, Dr. Heilmeier served as a Member of the Advisory Board. Effective January 1, 2004, Dr. Heilmeier serves as a Member of the Board of Trustees.

***** Effective January 1, 2004, Ms. Small serves as a Member of the Advisory Board.

^A Information is for the calendar year ended December 31, 2003 for 293 funds of 57 trusts in the fund complex. Compensation figures include cash, amounts required to be deferred, and may include amounts deferred at the election of Trustees. For the calendar year ended December 31, 2003, the Trustees accrued required deferred compensation from the funds as follows: J. Michael Cook, $111,000; Ralph F. Cox, $111,000; Phyllis Burke Davis, $111,000; Robert M. Gates, $111,000; Donald J. Kirk, $111,000; Marie L. Knowles, $111,000; Ned C. Lautenbach, $111,000; Marvin L. Mann, $141,000; William O. McCoy, $111,000; and William S. Stavropoulos, $111,000. Certain of the non-interested Trustees elected voluntarily to defer a portion of their compensation as follows: J. Michael Cook, $35,316.47; Ralph F. Cox, $35,316.47; Phyllis Burke Davis, $44,989.93; Ned C. Lautenbach, $44,989.93; and William O. McCoy, $82,489.93.

^B Compensation figures include cash and may include amounts deferred at Mr. McCoy's election under a deferred compensation plan adopted by the other open-end registered investment companies in the fund complex (Other Open-End Funds). Pursuant to the deferred compensation plan, Mr. McCoy, as a non-interested Trustee, may elect to defer receipt of all or a portion of his annual fees. Amounts deferred under the deferred compensation plan are credited to an account established for Mr. McCoy on the books of the Other Open-End Funds. Interest is accrued on amounts deferred under the deferred compensation plan. For the calendar year ended December 31, 2003, Mr. McCoy voluntarily elected to defer $37,500.

^C Compensation figures include cash, amounts required to be deferred, and may include amounts deferred at the election of Trustees. The amounts required to be deferred by each non-interested Trustee are as follows: J. Michael Cook, $1,727; Ralph F. Cox, $1,727; Phyllis Burke Davis, $1,727; Robert M. Gates, $1,727; Donald J. Kirk, $1,727; Marie L. Knowles, $1,727; Ned C. Lautenbach, $1,727; Marvin L. Mann, $2,194; William O. McCoy, $1,727; and William S. Stavropoulos, $1,727. Certain of the non-interested Trustees' aggregate compensation from the fund includes accrued voluntary deferred compensation as follows: J. Michael Cook, $700; Ralph F. Cox, $700; Phyllis Burke Davis, $700; Ned C. Lautenbach, $700; and William O. McCoy, $700.

^D Compensation figures include cash, amounts required to be deferred, and may include amounts deferred at the election of Trustees. The amounts required to be deferred by each non-interested Trustee are as follows: J. Michael Cook, $1,817; Ralph F. Cox, $1,817; Phyllis Burke Davis, $1,817; Robert M. Gates, $1,817; Donald J. Kirk, $1,817; Marie L. Knowles, $1,817; Ned C. Lautenbach, $1,817; Marvin L. Mann, $2,308; William O. McCoy, $1,817; and William S. Stavropoulos, $1,817. Certain of the non-interested Trustees' aggregate compensation from the fund includes accrued voluntary deferred compensation as follows: J. Michael Cook, $737; Ralph F. Cox, $737; Phyllis Burke Davis, $737; Ned C. Lautenbach, $737; and William O. McCoy, $737.

^E Compensation figures include cash, amounts required to be deferred, and may include amounts deferred at the election of Trustees. The amounts required to be deferred by each non-interested Trustee are as follows: J. Michael Cook, $286; Ralph F. Cox, $286; Phyllis Burke Davis, $286; Robert M. Gates, $286; Donald J. Kirk, $286; Marie L. Knowles, $286; Ned C. Lautenbach, $286; Marvin L. Mann, $363; William O. McCoy, $286; and William S. Stavropoulos, $286. Certain of the non-interested Trustees' aggregate compensation from the fund includes accrued voluntary deferred compensation as follows: J. Michael Cook, $116; Ralph F. Cox, $116; Phyllis Burke Davis, $116; Ned C. Lautenbach, $116; and William O. McCoy, $116.

Under a deferred compensation plan adopted in September 1995 and amended in November 1996 and January 2000 (the Plan), non-interested Trustees must defer receipt of a portion of, and may elect to defer receipt of an additional portion of, their annual fees. Amounts deferred under the Plan are treated as though equivalent dollar amounts had been invested in shares of a cross-section of Fidelity funds including funds in each major investment discipline and representing a majority of Fidelity's assets under management (the Reference Funds). The amounts ultimately received by the non-interested Trustees under the Plan will be directly linked to the investment performance of the Reference Funds. Deferral of fees in accordance with the Plan will have a negligible effect on a fund's assets, liabilities, and net income per share, and will not obligate a fund to retain the services of any non-interested Trustee or to pay any particular level of compensation to the non-interested Trustee. A fund may invest in the Reference Funds under the Plan without shareholder approval.

OVERVIEW OF PROPOSALS 3 THROUGH 8

Proposals 3 through 8 present new foreign sub-advisory agreements (Proposed Agreements) for Equity-Income Portfolio and Growth Portfolio. If the Proposed Agreements are approved, these funds will have the same foreign sub-advisory arrangements that have become standard for other Fidelity equity funds.

<R>FMR, the funds' investment advisor, has a number of affiliates that provide sub-advisory services to mutual funds. These affiliates' offices are geographically dispersed around the world. FMR's affiliated foreign sub-advisers include FMR U.K., FMR Far East, FIJ, FIIA, and FIIA(U.K.)L.</R>

FMR believes it is desirable to enter into agreements with these affiliated foreign sub-advisers with respect to the Funds. Using affiliated foreign sub-advisers provides FMR increased flexibility in the assignment of portfolio managers and gives the Fidelity funds access to managers located abroad who may have more specialized expertise with respect to local companies and markets. In addition, FMR believes funds and shareholders may benefit from the ability of FMR, through foreign sub-advisers, to execute portfolio transactions from points abroad that are physically closer to foreign issuers and the primary markets in which their securities are traded. FMR believes that through arrangements with its affiliated foreign sub-advisers, funds may participate more readily in full trading sessions on foreign exchanges, and may be positioned to react more quickly to changing foreign market conditions.

Since 1997, standard foreign sub-advisory arrangements with FMR U.K. and FMR Far East have been adopted by Fidelity equity funds. New Fidelity equity funds since 1997 have adopted these foreign sub-advisory arrangements prior to commencement, and equity funds in existence before 1997 have asked shareholders to approve the new arrangements. Since Equity-Income Portfolio and Growth Portfolio commenced operations before 1997 (in 1986) the funds need shareholder approval in order to adopt these standard agreements with FMR U.K. and FMR Far East.

In 2001, all Fidelity equity funds that had existing sub-advisory arrangements with FMR Far East were made parties to a new sub-advisory agreement between FMR Far East and FIJ. In 2003, all Fidelity equity funds that had existing foreign sub-advisory arrangements with FMR Far East and FMR U.K. were made parties to sub-advisory agreements between FMR and FIIA, FIIA and FIIA(U.K.)L, and FIIA and FIJ.

Unlike the agreements with FMR U.K. and FMR Far East, the sub-advisory arrangements entered into on behalf of Fidelity's equity funds in 2001 and 2003 did not require shareholder approval for funds that had previously existing foreign sub-advisory arrangements. Instead, consistent with SEC staff positions that shareholder approval is not required for certain sub-adviser restructurings when there is no increase in fund fees or change in the identity of the individuals providing sub-advisory services, these funds appointed FIJ, FIIA, and FIIA(U.K.)L as sub-advisers without shareholder approval. Equity-Income Portfolio and Growth Portfolio, the only two publicly offered Fidelity equity funds without foreign sub-advisory arrangements in place at the time, were unable to appoint FIJ, FIIA, and FIIA(U.K.)L.

As detailed in proposals 3 through 8, FMR proposes that Equity-Income Portfolio and Growth Portfolio adopt the Proposed Agreements among FMR, the trust, FMR U.K., FMR Far East, FIJ, FIIA, and FIIA(U.K.)L. If approved, each fund will have the standard array of foreign sub-advisory arrangements available to Fidelity equity funds. At a meeting on April 15, 2004, the Board of Trustees of the funds, including all non-interested Trustees, approved the Proposed Agreements and recommended that shareholders of each fund approve the Proposed Agreements. It is important to note that while you are being asked to approve new agreements, the Proposed Agreements will not result in increased fund fees.

As described below, Proposal 5 is contingent upon shareholder approval of Proposal 4 and Proposals 7 and 8 are contingent upon shareholder approval of Proposal 6.

3. TO APPROVE A NEW SUB-ADVISORY AGREEMENT AMONG FMR, FMR U.K., AND VARIABLE INSURANCE PRODUCTS FUND ON BEHALF OF EQUITY-INCOME PORTFOLIO AND GROWTH PORTFOLIO.

In conjunction with its portfolio management responsibilities on behalf of each fund, FMR proposes that shareholders of each fund approve a sub-advisory agreement (Proposed Agreement) among FMR, FMR U.K., and the trust on behalf of the fund. Each fund's Proposed Agreement would allow FMR not only to receive investment advice and research services from FMR U.K., but also would permit FMR to grant FMR U.K. investment management authority if FMR believes it would be beneficial to the fund and its shareholders. Because FMR would pay all of FMR U.K.'s fees, the Proposed Agreement would not affect the fees paid by either fund to FMR.

<R>On April 15, 2004, the Board of Trustees agreed to submit the Proposed Agreement to shareholders of each fund pursuant to a unanimous vote of both the full Board of Trustees and those Trustees who were not "interested persons" of the trust or FMR. FMR provided substantial information to the Trustees to assist them in their deliberations. For details regarding the Board's considerations, please see the section entitled "Matters Considered by the Board" beginning on page <Click Here> . A copy of the Proposed Agreement for each fund is attached to this proxy statement as Exhibit 2.</R>

FMR U.K. is a wholly-owned subsidiary of FMR established in 1986 to provide investment research to FMR with respect to foreign securities. This research complements other research on foreign securities produced by FMR's U.S.-based research analysts and portfolio managers or other sources.

<R>FMR U.K. may also provide investment advisory services to FMR with respect to other investment companies for which FMR serves as investment adviser, and to other clients. Currently, FMR U.K.'s only client other than FMR is Fidelity International Limited (FIL), an affiliate of FMR organized under the laws of Bermuda. FIL provides investment advisory services to non-U.S. investment companies and private accounts that invest in securities of issuers throughout the world. For more information on FMR U.K., see the section entitled "Activities and Management of FMR U.K., FMR Far East, FIJ, FIIA, and FIIA(U.K.)L" on page <Click Here> </R>.

Under each fund's Proposed Agreement, FMR U.K. could act as an investment consultant to FMR and could supply FMR with such investment research information and portfolio management advice as FMR reasonably requests on behalf of the fund. FMR U.K. would provide investment advice and research services with respect to issuers located outside of the United States focusing primarily on companies based in Europe. Under each fund's Proposed Agreement with FMR U.K., FMR, not the fund, would pay FMR U.K.'s fee equal to 110% of its costs incurred for providing investment advice and research services.

Under each fund's Proposed Agreement, FMR could also grant investment management authority with respect to all or a portion of the fund's assets to FMR U.K. If FMR U.K. were to exercise investment management authority on behalf of the fund, it would be required, subject to the supervision of FMR, to direct the investments of the fund in accordance with the fund's investment objective, policies, and limitations as provided in the fund's prospectus or other governing instruments and such other limitations as the fund may impose by notice in writing to FMR or FMR U.K. If FMR grants investment management authority to FMR U.K. with respect to all or a portion of the fund's assets, FMR U.K. would be authorized to buy or sell stocks, bonds, and other securities for the fund subject to the overall supervision of FMR and the Board of Trustees. In addition, the Proposed Agreement would authorize FMR to delegate other investment management services to FMR U.K., including, but not limited to, currency management services (including buying and selling currency options and entering into currency forward and futures contracts on behalf of each fund), other transactions in futures contracts and options, and borrowing or lending portfolio securities. If any investment management services were delegated, FMR U.K. would continue to be subject to the control and direction of FMR and the Board of Trustees and to be bound by the investment objective, policies, and limitations of the fund.

Each fund's Proposed Agreement would not increase the fees paid to FMR by each fund. To the extent that FMR granted investment management authority to FMR U.K., FMR, not the fund, would pay FMR U.K. 50% of its monthly management fee with respect to the average net assets managed on a discretionary basis by FMR U.K. for investment management.

<R>If approved by shareholders, each fund's Proposed Agreement would take effect on December 1, 2004 (or, if later, the first day of the first month following approval) and would continue in force until July 31, 2005 and from year to year thereafter, but only as long as its continuance was approved at least annually by (i) the vote, cast in person at a meeting called for the purpose, of a majority of those Trustees who are not "interested persons" of the trust or FMR and (ii) the vote of either a majority of the Trustees or by the vote of a majority of the outstanding shares of each fund.</R>

Each fund's Proposed Agreement could be transferred to a successor of FMR U.K. without resulting in its termination and without shareholder approval, as long as the transfer did not constitute an assignment under applicable securities laws and regulations. Each fund's Proposed Agreement would be terminable on 60 days' written notice by either party to the agreement and each fund's Proposed Agreement would terminate automatically in the event of its assignment.

Conclusion. Based on their evaluation of all material factors and assisted by the advice of independent counsel, the Trustees, including the non-Interested Trustees, concluded that the proposal will benefit each fund and its shareholders. The Board of Trustees, including the non-Interested Trustees, voted to approve the submission of the Proposed Agreement to shareholders of each fund and recommends that shareholders of each fund vote FOR the Proposed Agreement. If the Proposed Agreement is approved by shareholders of each fund, the Proposed Agreement will take effect on the first day of the first month following approval. If the Proposed Agreement is not approved by shareholders of each fund, FMR will consider alternative means of obtaining the investment services to be provided under the Proposed Agreement.

4. TO APPROVE A NEW SUB-ADVISORY AGREEMENT AMONG FMR, FMR FAR EAST, AND VARIABLE INSURANCE PRODUCTS FUND ON BEHALF OF EQUITY-INCOME PORTFOLIO AND GROWTH PORTFOLIO.

In conjunction with its portfolio management responsibilities on behalf of each fund, FMR proposes that shareholders of each fund approve a sub-advisory agreement (Proposed Agreement) among FMR, FMR Far East, and the trust on behalf of the fund. Each fund's Proposed Agreement would allow FMR not only to receive investment advice and research services from FMR Far East, but also would permit FMR to grant FMR Far East investment management authority if FMR believes it would be beneficial to the fund and its shareholders. Because FMR would pay all of FMR Far East's fees, each fund's Proposed Agreement would not affect the fees paid by either fund to FMR.

<R>On April 15, 2004, the Board of Trustees agreed to submit each fund's Proposed Agreement to shareholders of each fund pursuant to a unanimous vote of both the full Board of Trustees and those Trustees who were not "interested persons" of the trust or FMR. FMR provided substantial information to the Trustees to assist them in their deliberations. For details regarding the Board's considerations, please see the section entitled "Matters Considered by the Board" beginning on page <Click Here> . A copy of the Proposed Agreement for each fund is attached to this proxy statement as Exhibit 3.</R>

FMR Far East is a wholly-owned subsidiary of FMR established in 1986 to provide investment research to FMR with respect to foreign securities. This research complements other research on foreign securities produced by FMR's U.S.-based research analysts and portfolio managers or other sources.

<R>FMR Far East may also provide investment advisory and management services to FMR with respect to other investment companies for which FMR serves as investment adviser, and to other clients. Currently, FMR Far East's only client is FMR. For more information on FMR Far East, see the section entitled "Activities and Management of FMR U.K., FMR Far East, FIJ, FIIA, and FIIA(U.K.)L" on page <Click Here> </R>.

Under each fund's Proposed Agreement, FMR Far East could act as an investment consultant to FMR and could supply FMR with such investment research information and portfolio management advice as FMR reasonably requests on behalf of the fund. FMR Far East would provide investment advice and research services with respect to issuers located outside of the United States focusing primarily on companies based in the Far East. Under the Proposed Agreement with FMR Far East, FMR, not the fund, would pay FMR Far East's fee equal to 105% of its costs incurred for providing investment advice and research services. If this proposal is approved, FMR Far East, will in turn, enter into an agreement with FIJ, a wholly-owned subsidiary of FIL, to provide such investment research and portfolio management advice as FMR Far East reasonably requests. FMR Far East, not the fund, pays FIJ a sub-advisory fee equal to 100% of FIJ's costs incurred in connection with providing investment advice and research services.

Under each fund's Proposed Agreement, FMR could also grant investment management authority with respect to all or a portion of the fund's assets to FMR Far East. If FMR Far East were to exercise investment management authority on behalf of the fund, it would be required, subject to the supervision of FMR, to direct the investments of the fund in accordance with the fund's investment objective, policies, and limitations as provided in the fund's prospectus or other governing instruments and such other limitations as the fund may impose by notice in writing to FMR or FMR Far East. If FMR grants investment management authority to FMR Far East with respect to all or a portion of the fund's assets, FMR Far East would be authorized to buy or sell stocks, bonds, and other securities for the fund subject to the overall supervision of FMR and the Board of Trustees. In addition, each fund's Proposed Agreement would authorize FMR to delegate other investment management services to FMR Far East, including, but not limited to, currency management services (including buying and selling currency options and entering into currency forward and futures contracts on behalf of each fund), other transactions in futures contracts and options, and borrowing or lending portfolio securities. If any investment management services were delegated, FMR Far East would continue to be subject to the control and direction of FMR and the Board of Trustees and to be bound by the investment objective, policies, and limitations of the fund.

Each fund's Proposed Agreement would not increase the fees paid to FMR by each fund. To the extent that FMR granted investment management authority to FMR Far East, FMR, not the fund, would pay FMR Far East a fee equal to 50% of its monthly management fee with respect to the fund's average net assets managed on a discretionary basis by FMR Far East.

<R>If approved by shareholders, each fund's Proposed Agreement would take effect on December 1, 2004 (or, if later, the first day of the first month following approval) and would continue in force until July 31, 2005 and from year to year thereafter, but only as long as its continuance was approved at least annually by (i) the vote, cast in person at a meeting called for the purpose, of a majority of those Trustees who are not "interested persons" of the trust or FMR and (ii) the vote of either a majority of the Trustees or by the vote of a majority of the outstanding shares of each fund.</R>

Each fund's Proposed Agreement could be transferred to a successor of FMR Far East without resulting in its termination and without shareholder approval, as long as the transfer did not constitute an assignment under applicable securities laws and regulations. Each fund's Proposed Agreement would be terminable on 60 days' written notice by either party to the agreement and each fund's Proposed Agreement would terminate automatically in the event of its assignment.

Conclusion. Based on their evaluation of all material factors and assisted by the advice of independent counsel, the Trustees, including the non-Interested Trustees, concluded that the proposal will benefit each fund and its shareholders. The Board of Trustees, including the non-Interested Trustees, voted to approve the submission of the Proposed Agreement to shareholders of each fund and recommends that shareholders of each fund vote FOR the Proposed Agreement. If the Proposed Agreement is approved by shareholders of each fund, the Proposed Agreement will take effect on the first day of the first month following approval. If the Proposed Agreement is not approved by shareholders of each fund, FMR will consider alternative means of obtaining the investment services to be provided under the Proposed Agreement.

5. TO APPROVE A NEW AMENDED AND RESTATED SUB-ADVISORY AGREEMENT BETWEEN FMR FAR EAST AND FIJ FOR EQUITY-INCOME PORTFOLIO AND GROWTH PORTFOLIO.

In conjunction with its portfolio management responsibilities on behalf of each fund, FMR proposes that shareholders of each fund approve an amended and restated sub-advisory agreement (Proposed Agreement) between FMR Far East and FIJ on behalf of the fund. Each fund's Proposed Agreement would allow FMR and FMR Far East not only to receive investment advice and research services from FIJ, but also would permit FMR Far East to delegate to FIJ investment management authority with respect to either Fund if FMR or FMR Far East believes it would be beneficial to either fund and its shareholders. Because FMR Far East would pay all of FIJ's fees, the Proposed Agreement would not affect the fees paid by either fund to FMR.

<R>On April 15, 2004, the Board of Trustees agreed to submit the Proposed Agreement to shareholders of each fund pursuant to a unanimous vote of both the full Board of Trustees and those Trustees who were not "interested persons" of the trust or FMR. FMR provided substantial information to the Trustees to assist them in their deliberations. For details regarding the Board's considerations, please see the section entitled "Matters Considered by the Board" beginning on page <Click Here> . A copy of the Proposed Agreement is attached to this proxy statement as Exhibit 4.</R>

FIJ is a wholly-owned subsidiary of FIL established in 1986 to provide investment research to FMR with respect to foreign securities. This research complements other research on foreign securities produced by FMR's U.S.-based research analysts and portfolio managers or other sources.

<R>FIJ may also provide investment advisory and management services to FMR and FMR Far East with respect to other investment companies for which they serve as investment adviser, and to other clients. For more information on FIJ, see the section entitled "Activities and Management of FMR U.K., FMR Far East, FIJ, FIIA, and FIIA(U.K.)L" on page <Click Here> </R>.

Under each fund's Proposed Agreement, FIJ could act as an investment consultant to FMR or FMR Far East and could supply FMR or FMR Far East with such investment research information and portfolio management advice as FMR Far East reasonably requests on behalf of each fund. FIJ would provide investment advice and research services with respect to issuers located outside of the United States focusing primarily on companies based in Japan (and other Asian companies as FMR Far East may request from time to time). Under each fund's Proposed Agreement with FIJ, FMR Far East, not the fund, would pay FIJ's fee equal to 100% of its costs incurred for providing investment advice and research services.

Under each fund's Proposed Agreement, FMR Far East could also delegate investment management authority with respect to a portion of the fund's assets to FIJ. If FIJ were to exercise investment management authority on behalf of the fund, it would be required, subject to the supervision of FMR or FMR Far East, to direct the investments of the fund in accordance with the fund's investment objective, policies, and limitations as provided in the fund's prospectus or other governing instruments and such other limitations as the fund may impose by notice in writing to FMR, FMR Far East or FIJ. If FMR Far East delegates investment management authority to FIJ with respect to a portion of the fund's assets, FIJ would be authorized to buy or sell stocks, bonds, and other securities for the fund subject to the overall supervision of FMR, FMR Far East and the Board of Trustees.

Each fund's Proposed Agreement would not increase the fees paid to FMR by each fund. To the extent that FMR Far East delegated investment management authority to FIJ, FMR Far East, not the fund, would pay FIJ a fee equal to 100% of its costs incurred in connection with providing investment advice and research services for each fund to FMR or FMR Far East.

<R>If approved by shareholders, each fund's Proposed Agreement would take effect on December 1, 2004 (or, if later, the first day of the first month following approval) and would continue in force until July 31, 2005 and from year to year thereafter, but only as long as its continuance was approved at least annually by (i) the vote, cast in person at a meeting called for the purpose, of a majority of those Trustees who are not "interested persons" of the trust or FMR and (ii) the vote of either a majority of the Trustees or by the vote of a majority of the outstanding shares of each fund.</R>

Each fund's Proposed Agreement could be transferred to a successor of FIJ without resulting in its termination and without shareholder approval, as long as the transfer did not constitute an assignment under applicable securities laws and regulations. Each fund's Proposed Agreement would be terminable on 60 days' written notice by either party to the agreement and each fund's Proposed Agreement would terminate automatically in the event of its assignment.

Conclusion. Based on their evaluation of all material factors and assisted by the advice of independent counsel, the Trustees, including the non-Interested Trustees, concluded that the proposal will benefit each fund and its shareholders. The Board of Trustees, including the non-Interested Trustees, voted to approve the submission of the Proposed Agreement to shareholders of each fund and recommends that shareholders of each fund vote FOR the Proposed Agreement.

Approval of this proposal is contingent upon shareholder approval of Proposal 4. If this proposal and Proposal 4 are approved, each fund's Proposed Agreement will take effect on the first day of the first month following shareholder approval. If the proposal is not approved, FMR will consider alternative means of obtaining the investment services to be provided under the Proposed Agreement.

6. TO APPROVE A NEW MASTER INTERNATIONAL RESEARCH AGREEMENT BETWEEN FMR AND FIIA ON BEHALF OF EQUITY-INCOME PORTFOLIO AND GROWTH PORTFOLIO.

In conjunction with its portfolio management responsibilities on behalf of each fund, FMR proposes that shareholders of each fund approve a master international research agreement (Proposed Agreement) between FMR and FIIA on behalf of the fund. Each fund's Proposed Agreement would allow FMR to receive investment advice and research services from FIIA. Because FMR would pay all of FIIA's fees, the Proposed Agreement would not affect the fees paid by either fund to FMR.

<R>On April 15, 2004, the Board of Trustees agreed to submit each fund's Proposed Agreement to shareholders of each fund pursuant to a unanimous vote of both the full Board of Trustees and those Trustees who were not "interested persons" of the trust or FMR. FMR provided substantial information to the Trustees to assist them in their deliberations. For details regarding the Board's considerations, please see the section entitled "Matters Considered by the Board" beginning on page <Click Here> . A copy of the Proposed Agreement is attached to this proxy statement as Exhibit 5.</R>

FIIA is a wholly-owned subsidiary of Fidelity International Limited (FIL) established in 1983 to provide investment research to FIL with respect to foreign securities. This research complements other research on foreign securities produced by FMR's U.S.-based research analysts and portfolio managers or other sources.

<R>FIIA may also provide investment advisory services to FMR with respect to other investment companies for which FMR serves as investment adviser, and to other clients. FIL is an affiliate of FMR organized under the laws of Bermuda. FIL provides investment advisory services to non-U.S. investment companies and private accounts investing in securities of issuers throughout the world. For more information on FIIA, see the section entitled "Activities and Management of FMR U.K., FMR Far East, FIJ, FIIA, and FIIA(U.K.)L" on page <Click Here> .</R>

Under each fund's Proposed Agreement, FIIA could act as an investment consultant to FMR and could supply FMR with such investment research information and portfolio management advice as FMR reasonably requests on behalf of the fund. FIIA would provide investment advice and research services with respect to issuers located outside of the United States and Canada. Under each fund's Proposed Agreement with FIIA, FMR, not the fund, would pay FIIA's fee for providing investment advice and research services.

Each fund's Proposed Agreement would not increase the fees paid to FMR by each fund. To the extent that FMR received international investment advice and research services from FIIA, FMR, not the fund, would pay FIIA an amount based on each fund's international net assets relative to the international assets of other registered investment companies with which FMR has management contracts.

<R>If approved by shareholders, each fund's Proposed Agreement would take effect on December 1, 2004 (or, if later, the first day of the first month following approval) and would continue in force until July 31, 2005 and from year to year thereafter, but only as long as its continuance was approved at least annually by (i) the vote, cast in person at a meeting called for the purpose, of a majority of those Trustees who are not "interested persons" of the trust or FMR and (ii) the vote of either a majority of the Trustees or by the vote of a majority of the outstanding shares of each fund.</R>

Each fund's Proposed Agreement could be transferred to a successor of FIIA without resulting in its termination and without shareholder approval, as long as the transfer did not constitute an assignment under applicable securities laws and regulations. Each fund's Proposed Agreement would be terminable on 60 days' written notice by either party to the agreement and each fund's Proposed Agreement would terminate automatically in the event of its assignment.

Conclusion. Based on their evaluation of all material factors and assisted by the advice of independent counsel, the Trustees, including the non-Interested Trustees, concluded that the proposal will benefit each fund and its shareholders. The Board of Trustees, including the non-Interested Trustees, voted to approve the submission of the Proposed Agreement to shareholders of each fund and recommends that shareholders of each fund vote FOR the Proposed Agreement. If the Proposed Agreement is approved by shareholders of each fund, the Proposed Agreement will take effect on the first day of the first month following approval. If the Proposed Agreement is not approved by shareholders of each fund, FMR will consider alternative means of obtaining the investment services to be provided under the Proposed Agreement.

7. TO APPROVE A NEW SUB-RESEARCH AGREEMENT BETWEEN FIIA AND FIIA(U.K.)L ON BEHALF OF EQUITY-INCOME PORTFOLIO AND GROWTH PORTFOLIO.

In conjunction with its portfolio management responsibilities on behalf of each fund, FMR proposes that shareholders of each fund approve a sub-research agreement (Proposed Agreement) between FIIA and FIIA(U.K.)L on behalf of the fund. Each fund's Proposed Agreement would allow FIIA to receive investment advice and research services from FIIA(U.K.)L. Because FIIA would pay all of FIIA(U.K.)L's fees, each fund's Proposed Agreement would not affect the fees paid by either fund to FMR.

<R>On April 15, 2004, the Board of Trustees agreed to submit each fund's Proposed Agreement to shareholders of each fund pursuant to a unanimous vote of both the full Board of Trustees and those Trustees who were not "interested persons" of the trust or FMR. FMR provided substantial information to the Trustees to assist them in their deliberations. For details regarding the Board's considerations, please see the section entitled "Matters Considered by the Board" beginning on page <Click Here> . A copy of the Proposed Agreement is attached to this proxy statement as Exhibit 6.</R>

<R>FIIA(U.K.)L is a wholly-owned subsidiary of Fidelity Investments Management Limited, an indirect wholly-owned subsidiary of FIL. FIIA(U.K.)L, established in 1984, provides investment research to FIIA with respect to foreign securities. This research complements other research on foreign securities produced by FMR's U.S.-based research analysts and portfolio managers or other sources.</R>

<R>FIIA(U.K.)L may also provide investment advisory services to FIIA with respect to other investment companies for which FIIA serves as investment adviser, and to other clients. For more information on FIIA(U.K.)L, see the section entitled "Activities and Management of FMR U.K., FMR Far East, FIJ, FIIA, and FIIA(U.K.)L" on page <Click Here> .</R>

Under each fund's Proposed Agreement, FIIA(U.K.)L could act as an investment consultant to FIIA and could supply FIIA with such investment research information as FIIA reasonably requests on behalf of each fund. FIIA(U.K.)L would provide investment advice and research services with respect to issuers located outside of the United States and Canada. Under each fund's Proposed Agreement with FIIA(U.K.)L, FIIA, not the fund, would pay FIIA(U.K.)L's fee for providing investment advice and research services.

Each fund's Proposed Agreement would not increase the fees paid to FMR by each fund. To the extent that FIIA received international investment advice and research services from FIIA(U.K.)L, FIIA, not the fund, would pay FIIA(U.K.)L an amount equal to the administrative costs incurred in providing investment advice and research services for a fund.

<R>If approved by shareholders, each fund's Proposed Agreement would take effect on December 1, 2004 (or, if later, the first day of the first month following approval) and would continue in force until July 31, 2005 and from year to year thereafter, but only as long as its continuance was approved at least annually by (i) the vote, cast in person at a meeting called for the purpose, of a majority of those Trustees who are not "interested persons" of the trust or FMR and (ii) the vote of either a majority of the Trustees or by the vote of a majority of the outstanding shares of each fund.</R>

Each fund's Proposed Agreement could be transferred to a successor of FIIA(U.K.)L without resulting in its termination and without shareholder approval, as long as the transfer did not constitute an assignment under applicable securities laws and regulations. Each fund's Proposed Agreement would be terminable on 60 days' written notice by either party to the agreement and each fund's Proposed Agreement would terminate automatically in the event of its assignment.

Conclusion. Based on their evaluation of all material factors and assisted by the advice of independent counsel, the Trustees, including the non-Interested Trustees, concluded that the proposal will benefit each fund and its shareholders. The Board of Trustees, including the non-Interested Trustees, voted to approve the submission of the Proposed Agreement to shareholders of each fund and recommends that shareholders of each fund vote FOR the Proposed Agreement.

Approval of this proposal is contingent upon shareholder approval of Proposal 6. If this proposal and Proposal 6 are approved, each fund's Proposed Agreement will take effect on the first day of the first month following shareholder approval. If the proposal is not approved, FMR will consider alternative means of obtaining the investment services to be provided under the Proposed Agreement.

8. TO APPROVE A NEW SUB-RESEARCH AGREEMENT BETWEEN FIIA AND FIJ ON BEHALF OF EQUITY-INCOME PORTFOLIO AND GROWTH PORTFOLIO.

In conjunction with its portfolio management responsibilities on behalf of each fund, FMR proposes that shareholders of each fund approve a sub-research agreement (Proposed Agreement) between FIIA and FIJ on behalf of the fund. Each fund's Proposed Agreement would allow FIIA to receive investment advice and research services from FIJ. Because FIIA would pay all of FIJ's fees, each fund's Proposed Agreement would not affect the fees paid by either fund to FMR.

<R>On April 15, 2004, the Board of Trustees agreed to submit each fund's Proposed Agreement to shareholders of each fund pursuant to a unanimous vote of both the full Board of Trustees and those Trustees who were not "interested persons" of the trust or FMR. FMR provided substantial information to the Trustees to assist them in their deliberations. For details regarding the Board's considerations, please see the section entitled "Matters Considered by the Board" beginning on page 31. A copy of the Proposed Agreement is attached to this proxy statement as Exhibit 7.</R>

FIJ is a wholly-owned subsidiary of FIL established in 1986 to provide investment research to FMR with respect to foreign securities. This research complements other research on foreign securities produced by FMR's U.S.-based research analysts and portfolio managers, or obtained from broker-dealers or other sources.

<R>FIJ may also provide investment advisory services to FMR and FIIA with respect to other investment companies for which they serve as investment adviser, and to other clients. For more information on FIJ, see the section entitled "Activities and Management of FMR U.K., FMR Far East, FIJ, FIIA, and FIIA(U.K.)L" on page <Click Here> .</R>

Under each fund's Proposed Agreement, FIJ could act as an investment consultant to FIIA and could supply FIIA with such investment research information as FIIA reasonably requests on behalf of each fund. FIJ would provide investment advice and research services with respect to issuers located outside of the United States and Canada. Under the Proposed Agreement with FIJ, FIIA, not the fund, would pay FIJ's fee for providing investment advice and research services.

Each fund's Proposed Agreement would not increase the fees paid to FMR by each fund. To the extent that FIIA received international investment advice and research services from FIJ, FIIA, not the fund, would pay FIJ an amount equal to the administrative costs incurred in providing investment advice and research services for a fund.

<R>If approved by shareholders, each fund's Proposed Agreement would take effect on December 1, 2004 (or, if later, the first day of the first month following approval) and would continue in force until July 31, 2005 and from year to year thereafter, but only as long as its continuance was approved at least annually by (i) the vote, cast in person at a meeting called for the purpose, of a majority of those Trustees who are not "interested persons" of the trust or FMR and (ii) the vote of either a majority of the Trustees or by the vote of a majority of the outstanding shares of each fund.</R>

Each fund's Proposed Agreement could be transferred to a successor of FIJ without resulting in its termination and without shareholder approval, as long as the transfer did not constitute an assignment under applicable securities laws and regulations. Each fund's Proposed Agreement would be terminable on 60 days' written notice by either party to the agreement and each fund's Proposed Agreement would terminate automatically in the event of its assignment.

Conclusion. Based on their evaluation of all material factors and assisted by the advice of independent counsel, the Trustees, including the non-Interested Trustees, concluded that the proposal will benefit each fund and its shareholders. The Board of Trustees, including the non-Interested Trustees, voted to approve the submission of the Proposed Agreement to shareholders of each fund and recommends that shareholders of each fund vote FOR the Proposed Agreement.

Approval of this proposal is contingent upon shareholder approval of Proposal 6. If this proposal and Proposal 6 are approved, each fund's Proposed Agreement will take effect on the first day of the first month following shareholder approval. If the proposal is not approved, FMR will consider alternative means of obtaining the investment services to be provided under the Proposed Agreement.

MATTERS CONSIDERED BY THE BOARD

The mutual funds for which the members of the Board of Trustees serve as Trustees are referred to herein as the "Fidelity funds." The Board of Trustees meets 11 times a year. The Board of Trustees, including the non-Interested Trustees, believes that matters bearing on each fund's advisory contracts are considered at most, if not all, of its meetings. While the full Board of Trustees or the non-Interested Trustees, as appropriate, act on all major matters, a significant portion of the activities of the Board of Trustees (including certain of those described herein) is conducted through committees. The non-Interested Trustees meet frequently in executive session and are advised by independent legal counsel selected by the non-Interested Trustees.

The proposals to present the sub-advisory agreements among FMR, the trust, FMR U.K., FMR Far East, FIJ, FIIA, and FIIA(U.K.)L with respect to Equity-Income Portfolio and Growth Portfolio (Proposed Agreements) to shareholders were approved by the Board of Trustees of the funds, including all non-Interested Trustees, at a meeting on April 15, 2004.

In connection with their meetings, the Board of Trustees, including the non-Interested Trustees, received materials specifically relating to the Proposed Agreements. These materials included (i) information on the investment performance of each fund, a peer group of funds and an appropriate index or combination of indices, (ii) sales and redemption data in respect of each fund, and (iii) the economic outlook and the general investment outlook in the markets in which each fund invests. The Board of Trustees, including the non-Interested Trustees, also considers periodically other material facts such as (1) the results and financial condition of FMR U.K., FMR Far East, FIJ, FIIA, and FIIA(U.K.)L (the Investment Advisers), (2) arrangements in respect of the distribution of each fund's shares, (3) the procedures employed to determine the value of each fund's assets, (4) the allocation of each fund's brokerage, if any, including allocations to brokers affiliated with the Investment Advisers, the use of "soft" commission dollars to pay for research and brokerage services, and the use of brokerage commissions to pay fund expenses, (5) the Investment Advisers' management of the relationships with each fund's custodians and subcustodians, (6) the resources devoted to and the record of compliance with each fund's investment policies and restrictions and with policies on personal securities transactions, and (7) the nature, cost and character of non-investment management services provided by the Investment Advisers and their affiliates.

Additional information was furnished by the Investment Advisers including, among other items, information on and analysis of (a) the overall organization of the Investment Advisers, (b) investment performance, (c) the choice of performance indices and benchmarks, (d) the composition of peer groups of funds, (e) transfer agency and bookkeeping fees paid to affiliates of the Investment Advisers, (f) investment management staffing, (g) the potential for achieving further economies of scale, (h) operating expenses paid to third parties, and (i) the information furnished to investors, including each fund's shareholders.

In considering the Proposed Agreements, the Board of Trustees, including the non-Interested Trustees, did not identify any single factor as all-important or controlling, and the following summary does not detail all the matters considered. Matters considered by the Board of Trustees, including the non-Interested Trustees, in connection with its approval of the Proposed Agreements include the following:

Benefits to Shareholders. The Board of Trustees, including the non-Interested Trustees, considered the benefit to shareholders of investing in a fund that is part of a large family of funds offering a variety of investment disciplines and providing for a large variety of fund and shareholder services.

Investment Compliance and Performance. The Board of Trustees, including the non-Interested Trustees, considered whether each fund has operated within its investment objective and its record of compliance with its investment restrictions. It also reviewed each fund's investment performance as well as the performance of a peer group of mutual funds, and the performance of an appropriate index or combination of indices.

The Investment Advisers' Personnel and Methods. The Board of Trustees, including the non-Interested Trustees, reviews at least annually the background of each fund's portfolio manager and each fund's investment objective and discipline. The non-Interested Trustees have also had discussions with senior management of the Investment Advisers responsible for investment operations and the senior management of Fidelity's equity group. Among other things they considered the size, education and experience of the Investment Advisers' investment staff, their use of technology, and the Investment Advisers' approach to recruiting, training and retaining portfolio managers and other research, advisory and management personnel.

Nature and Quality of Other Services. The Board of Trustees, including the non-Interested Trustees, considered the nature, quality, cost and extent of administrative and shareholder services performed by the Investment Advisers and affiliated companies, both under the Proposed Agreements and under separate agreements covering transfer agency functions and pricing, bookkeeping and securities lending services, if any. The Board of Trustees, including the non-Interested Trustees, has also considered the nature and extent of the Investment Advisers' supervision of third party service providers, principally custodians and subcustodians.

Expenses. The Board of Trustees, including the non-Interested Trustees, considered each fund's expense ratio, and expense ratios of a peer group of funds. It also considered the amount and nature of fees paid by shareholders.

Profitability. The Board of Trustees, including the non-Interested Trustees, considered the level of the Investment Advisers' profits in respect of the management of the Fidelity funds. This consideration included an extensive review of the Investment Advisers' methodology in allocating their costs to the management of a fund. The Board of Trustees, including the non-Interested Trustees, has concluded that the cost allocation methodology employed by the Investment Advisers has a reasonable basis and is appropriate in light of all of the circumstances. It considered the profits realized by the Investment Advisers in connection with the operation of a fund and whether the amount of profit is a fair entrepreneurial profit for the management of a fund. It also considered the profits realized from non-fund businesses which may benefit from or be related to a fund's business. The Board of Trustees, including the non-Interested Trustees, also considered the Investment Advisers' profit margins in comparison with available industry data.

Economies of Scale. The Board of Trustees, including the non-Interested Trustees, considered whether there have been economies of scale in respect of the management of the Fidelity funds, whether the Fidelity funds (including each fund) have appropriately benefitted from any economies of scale, and whether there is potential for realization of any further economies of scale. The Board of Trustees, including the non-Interested Trustees, has concluded that any potential economies of scale are being shared between fund shareholders and the Investment Advisers in an appropriate manner.

Other Benefits to the Investment Advisers. The Board of Trustees, including the non-Interested Trustees, also considered the character and amount of fees paid by each fund and each fund's shareholders for services provided by the Investment Advisers and their affiliates, including fees for services like transfer agency, fund accounting, and direct shareholder services. It also considered the allocation of fund brokerage to brokers affiliated with the Investment Advisers, the receipt of sales loads and payments under Rule 12b-1 plans in respect of certain of the Fidelity funds, and benefits to the Investment Advisers from the use of "soft" commission dollars to pay for research and brokerage services. The Board of Trustees, including the non-Interested Trustees, considered the intangible benefits that accrue to the Investment Advisers and their affiliates by virtue of their relationship with each fund.

Conclusion. The Trustees determined that allowing FMR to receive investment advice and research services from the Investment Advisers as well as in certain cases to grant investment management authority to certain Investment Advisers would provide FMR increased flexibility in the assignment of portfolio managers and give each fund access to managers located abroad who may have more specialized expertise with respect to local companies and markets. Additionally, the Trustees believe that each fund and its shareholders may benefit from giving FMR, through the Investment Advisers, the ability to execute portfolio transactions from points abroad that are physically closer to foreign issuers and the primary markets in which their securities are traded. Increasing FMR's proximity to foreign markets should enable each fund to participate more readily in full trading sessions on foreign exchanges, and to react more quickly to changing market conditions. Finally, the Trustees noted that FMR or an affiliated sub-adviser, but not the funds, would pay for any services provided under the Proposed Agreements.

Based on their evaluation of all material factors and assisted by the advice of independent counsel, the Board of Trustees, including the non-Interested Trustees, concluded that the addition of the Proposed Agreements is in the best interest of each fund's shareholders. The Board of Trustees, including the non-Interested Trustees, voted to approve the submission of the Proposed Agreements to shareholders of the fund and recommends that shareholders of each fund vote FOR the Proposed Agreements. If approved, the Proposed Agreements will take effect on the first day of the first month following shareholder approval.

9. TO AMEND EQUITY-INCOME PORTFOLIO'S, GROWTH PORTFOLIO'S, HIGH INCOME PORTFOLIO'S, AND OVERSEAS PORTFOLIO'S FUNDAMENTAL INVESTMENT LIMITATION CONCERNING BORROWING.

<R>Each fund's current fundamental investment limitation concerning borrowing states:</R>

"The fund may not borrow money, except that the fund (i) may borrow money for temporary or emergency purposes (not for leveraging or investment) or (ii) engage in reverse repurchase agreements, provided that (i) and (ii) in combination (borrowings) do not exceed 33 1/3% of its total assets (including the amount borrowed) less liabilities (other than borrowings). Any borrowings that come to exceed 33 1/3% of the value of the fund's total assets by reason of a decline in net assets will be reduced within three days (exclusive of Sundays and holidays) to the extent necessary to comply with the 33 1/3% limitation."

<R>The Trustees recommend that shareholders of each fund vote to replace each fund's current fundamental limitation with the following amended fundamental investment limitation governing borrowing (additional language is underlined , deleted language is [bracketed]):</R>

"The fund may not borrow money, except that the fund [(i) ]may borrow money for temporary or emergency purposes (not for leveraging or investment) [or (ii) engage in reverse repurchase agreements, provided that (i) and (ii) in combination (borrowings) do] in an amount not exceed ing 33 1/3% of its total assets (including the amount borrowed) less liabilities (other than borrowings). Any borrowings that come to exceed [33 1/3% of the value of the fund's total assets by reason of a decline in net assets] this amount will be reduced within three days ([exclusive of ]not including Sundays and holidays) to the extent necessary to comply with the 33 1/3% limitation."

<R> Discussion of Proposed Modification. The primary purpose of the proposal is to revise each fund's fundamental borrowing limitation to conform to a limitation that has become standard for all funds managed by FMR. If the proposal is approved, the amended fundamental borrowing limitation cannot be changed without the approval of shareholders.</R>

<R>Adoption of the proposed fundamental limitation concerning borrowing is not expected to affect the way in which each fund is managed, the investment performance of each fund, or the securities or instruments in which each fund invests. However, the proposed changes would clarify the fundamental limitation. The wording of the current fundamental limitation suggests that reverse repurchase agreements are a separate category of permitted borrowing. The wording suggests that the funds might use reverse repurchase agreements for any purpose, including investment or leveraging. Instead, the funds only use reverse repurchase agreements for temporary or emergency borrowing.</R>

<R>In a reverse repurchase agreement, a fund sells a security to another party in return for cash and agrees to repurchase that security at a particular price and time. Adoption of the proposed fundamental limitation is not expected to affect the management or performance of each fund, since none of the funds would engage in reverse repurchase agreements for purposes other than temporary or emergency borrowing anyway. Non-fundamental limits can be changed by the Board of Trustees without the approval of shareholders.</R>

<R>If the amended limitation is approved, each fund will continue to follow their existing non-fundamental limitation, as follows, which also reflects that the funds treat reverse repurchase agreements as borrowings rather than a permitted type of investment or leverage:</R>

"The fund may borrow money only (a) from a bank or from a registered investment company or portfolio for which FMR or an affiliate serves as investment adviser or (b) by engaging in reverse repurchase agreements with any party (reverse repurchase agreements are treated as borrowings for purposes of the fundamental investment limitation)."

Conclusion. The Board of Trustees has concluded that the proposal will benefit each of Equity-Income Portfolio, Growth Portfolio, High Income Portfolio, and Overseas Portfolio and its shareholders. The Trustees recommend voting FOR the proposal. Upon shareholder approval, the amended fundamental limitation will become effective when the prospectus and/or statement of additional information are revised to reflect it. If the proposal is not approved by the shareholders of a fund, that fund's current limitation will remain unchanged.

10. TO AMEND EQUITY-INCOME PORTFOLIO'S, GROWTH PORTFOLIO'S, HIGH INCOME PORTFOLIO'S, MONEY MARKET PORTFOLIO'S, AND OVERSEAS PORTFOLIO'S FUNDAMENTAL INVESTMENT LIMITATION CONCERNING LENDING.

<R>Each fund's current fundamental investment limitation concerning lending is as follows:</R>

"The fund may not lend any security or make any other loan if, as a result, more than 33 1/3% of its total assets would be lent to other parties, but this limitation does not apply to purchases of debt securities or to repurchase agreements."

<R>The Trustees recommend that the shareholders of each fund vote to replace each fund's limitation with the following more modern fundamental investment limitation governing lending (additional language is underlined ):</R>

"The fund may not lend any security or make any other loan if, as a result, more than 33 1/3% of its total assets would be lent to other parties, but this limitation does not apply to purchases of debt securities or to repurchase agreements , or to acquisitions of loans, loan participations or other forms of debt instruments ."

<R> Discussion of Proposed Modification. The primary purpose of this proposal is to revise each fund's fundamental lending limitation to conform to a more modern limitation that is the standard for all funds managed by FMR or its affiliates. If the proposal is approved, the new fundamental lending limitation cannot be changed without the approval of shareholders.</R>

<R>Adoption of the proposed limitation on lending is not expected to affect the way in which each fund is managed, the investment performance of each fund, or the instruments in which each invests. However, the proposed limitation would clarify that acquisitions of loans, loan participations or other debt instruments are not subject to each fund's 33 1/3% limitation.</R>

If shareholders approve the proposed fundamental investment limitation on lending set forth above, the Board intends to adopt the following non-fundamental limitation for Equity-Income Portfolio, Growth Portfolio, High Income Portfolio, and Overseas Portfolio:

"The fund does not currently intend to lend assets other than securities to other parties, except by (a) lending money (up to 15% of the fund's net assets) to a registered investment company or portfolio for which FMR or an affiliate serves as investment adviser or (b) assuming any unfunded commitments in connection with the acquisition of loans, loan participations, or other forms of debt instruments. (This limitation does not apply to purchases of debt securities, to repurchase agreements, or to acquisitions of loans, loan participations or other forms of debt instruments.)"

<R>Money Market Portfolio currently has a non-fundamental limit that restricts the fund from lending other than by purchasing debt securities, purchasing repurchase agreements, lending securities, or lending money (up to 15% of its net assets) to a registered investment company or portfolio for which FMR or an affiliate serves as adviser. The Board does not intend to change this limitation.</R>

Loans and other forms of debt instruments are used by issuers to borrow money. Loans may be subject to restrictions on resale. Purchasers of loans and other forms of debt instruments depend primarily upon the creditworthiness of the borrower for payment of interest and principal. If scheduled interest or principal payments are not made, the value of the instrument may be adversely affected. Loans, loan participations, and other forms of direct debt instruments involve a risk of loss in case of default or insolvency of the borrower, lending bank, or other intermediary.

When a fund lends a security, it receives in return collateral in an amount at least equal in value to the security loaned. A fund could incur expenses if the borrower defaults on its obligation to return the securities loaned for any reason.

The Trustees may change non-fundamental limitations in response to regulatory, market, legal or other developments without the approval of shareholders.

<R> Conclusion. The Board of Trustees has concluded that the proposal will benefit each fund and its shareholders. The Trustees recommend voting FOR the proposal. Upon shareholder approval, the amended fundamental limitation will become effective when the prospectus and/or statement of additional information are revised to reflect it. If the proposal is not approved by the shareholders of a fund, that fund's current limitation will remain unchanged.</R>

OTHER BUSINESS

The Board knows of no other business to be brought before the Meeting. However, if any other matters properly come before the Meeting, it is the intention that proxies that do not contain specific instructions to the contrary will be voted on such matters in accordance with the judgment of the persons therein designated.

ACTIVITIES AND MANAGEMENT OF FMR

<R>FMR, a corporation organized in 1946, serves as investment adviser to a number of investment companies. Information concerning the advisory fees and average net assets of funds with investment objectives similar to Equity-Income Portfolio and Growth Portfolio and advised by FMR is contained in the Table of Average Net Assets and Advisory Fees in Exhibit 8 beginning on page <Click Here> .</R>

FMR, its officers and directors, its affiliated companies, and the Trustees, from time to time have transactions with various banks, including the custodian banks for certain of the funds advised by FMR. Those transactions that have occurred to date have included mortgages and personal and general business loans. In the judgment of FMR, the terms and conditions of those transactions were not influenced by existing or potential custodial or other fund relationships.

The Directors of FMR are Edward C. Johnson 3d, Chairman of the Board; Abigail P. Johnson, President; and Peter S. Lynch, Vice Chairman. Mr. Johnson 3d and Ms. Johnson are also Trustees of the trust. Mr. Lynch is a member of the Advisory Board of the trust. Ms. Johnson, John H. Costello, Christine Reynolds, Francis V. Knox, Jr., Thomas J. Simpson, Timothy F. Hayes, Eric D. Roiter, Stuart Fross, John R. Hebble, Kimberly H. Monasterio, Peter L. Lydecker, Mark Osterheld, Philip L. Bullen, Dwight D. Churchill, Bart A. Grenier, John B. McDowell, David L. Murphy, Matthew Conti, Stephen M. DuFour, Richard R. Mace, Jr., James K. Miller, Stephen R. Petersen, Jennifer Uhrig are currently officers of the trust and officers or employees of FMR or FMR Corp. All of these persons hold or have options to acquire stock or other securities of FMR Corp. The principal business address of each of the Directors of FMR is 82 Devonshire Street, Boston, Massachusetts 02109.

All of the stock of FMR is owned by its parent company, FMR Corp., 82 Devonshire Street, Boston, Massachusetts 02109, which was organized on October 31, 1972. Members of Mr. Edward C. Johnson 3d and Ms. Abigail P. Johnson's family are the predominant owners of a class of shares of common stock, representing approximately 49% of the voting power of FMR Corp., and, therefore, under the 1940 Act may be deemed to form a controlling group with respect to FMR Corp.

<R>In a transaction during the period from January 1, 2003 through July 31, 2004, Edward C. Johnson 3rd, acting on behalf of an entity organized for the benefit of his family, redeemed $183,851,688 of FMR Corp. securities for cash.</R>

ACTIVITIES AND MANAGEMENT OF FMRC

FMRC is a wholly-owned subsidiary of FMR formed in 1999 to provide portfolio management services to certain Fidelity funds and investment advice with respect to equity and high income instruments.

<R>Funds with investment objectives similar to Equity-Income Portfolio and Growth Portfolio for which FMR has entered into a sub-advisory agreement with FMRC, and the net assets of each of these funds, are indicated in the Table of Average Net Assets and Advisory Fees in Exhibit 8 beginning on page <Click Here> .</R>

The Directors of FMRC are Edward C. Johnson 3d, Chairman of the Board, Abigail P. Johnson, President, and Peter S. Lynch, Vice Chairman. Mr. Johnson 3d is also a Trustee of the trust and of other funds advised by FMR; Chairman of the Board, Chief Executive Officer, and a Director of FMR Corp.; Chairman of the Board and a Director of FMR, FMR Far East and Fidelity Investments Money Management, Inc. (FIMM). In addition, Ms. Johnson is Senior Vice President and a Trustee of the trust and of other funds advised by FMR; President and a Director of FMR and FIMM; and a Director of FMR Corp. Mr. Lynch is also Vice Chairman and a Director of FMR and a member of the Advisory Board of the trust and of other funds advised by FMR. Each of the Directors is a stockholder of FMR Corp. The principal business address of the Directors is 82 Devonshire Street, Boston, Massachusetts 02109.

ACTIVITIES AND MANAGEMENT OF FMR U.K., FMR FAR EAST,
FIJ, FIIA, AND FIIA(U.K.)L

<R>FMR U.K. and FMR Far East are wholly-owned subsidiaries of FMR that were formed in 1986. FIJ, organized in Japan in 1986, is a wholly-owned subsidiary of Fidelity International Limited (FIL), a Bermuda company formed in 1968. FIIA, established in 1983, is another wholly-owned subsidiary of FIL. FIIA(U.K.)L, established in 1984, is a wholly-owned subsidiary of Fidelity Investments Management Limited, an indirect wholly owned subsidiary of FIL. Edward C. Johnson 3rd, Johnson family members, and various trusts for the benefit of the Johnson family own, directly or indirectly, more than 25% of the voting common stock of FIL.</R>

<R>FMR U.K. and FMR Far East, FIJ, FIIA, and FIIA(U.K.)L provide research and investment recommendations with respect to companies based outside of the United States for certain funds for which FMR acts as investment adviser. They may also provide investment advisory services. FMR U.K. focuses primarily on companies based in the U.K. and Europe. FMR Far East focuses primarily on companies based in the Far East. FIJ focuses primarily on companies based in Japan and the Far East. FIIA focuses primarily on companies based in Hong Kong, Australia, New Zealand, and Southeast Asia (other than Japan). FIIA(U.K.)L focuses primarily on companies based in the U.K. and Europe. Funds with investment objectives similar to Equity-Income Portfolio and Growth Portfolio managed by FMR with respect to which FMR currently has sub-advisory agreements with either FMR U.K., FMR Far East, FIJ, FIIA and/or FIIA(U.K.)L and the net assets of each of these funds, are indicated in the Table of Average Net Assets and Advisory Fees in Exhibit 8 beginning on page <Click Here> .</R>

The Directors of FMR U.K. are Simon Fraser, Chairman of the Board and Chief Executive Officer, and Phillip L. Bullen, President. The Directors of FMR Far East are Edward C. Johnson 3d, Chairman of the Board, and Philip L. Bullen, President. Mr. Johnson 3d is also a Trustee of the trust and other funds advised by FMR; Chairman of the Board, Chief Executive Officer, and a Director of FMR Corp.; a Director and Chairman of the Board of FMR, FIMM and FMRC. Mr. Bullen is also Senior Vice President of FMR and FMRC; Vice President of certain Equity Funds advised by FMR; and Director of Strategic Advisers, Inc. Mr. Fraser is also a Director and President of FIIA;and a Director and Chief Executive Officer of FIIA(U.K.)L. Each of the Directors is a stockholder of FMR Corp. The principal business address of the Directors is 82 Devonshire Street, Boston, Massachusetts 02109.

<R>The Directors of FIJ are Yoshito Hirata, President, Simon M. Haslam, Yasuo Kuramoto, Jonathan O'Brien, Takeshi Okazaki, and Hiroshi Yamashita. Mr. Haslam is also Director of FIIA. Yasuo Kuramoto is also Vice Chairman of FIJ. The principal business address of each of the Directors is Shiroyama JT Trust Tower, 3-1, Toranomon 4-chome, Minato-ku, Tokyo, Japan 105-6019.</R>

The Directors of FIIA are Simon Fraser, President, Brett Goodin, Michael Gordon, Simon M. Haslam, David Holland, Frank Mutch, Peter Phillips, and David J. Saul. Mr. Holland is also Vice President of FIIA. The principal business address of each of the Directors is Pembroke Hall, 42 Crow Lane, Pembroke HM19, Bermuda.

The Directors of FIIA(U.K.)L are Simon Fraser, Chief Executive Officer, Andrew Steward, Ann Stock, and Richard Wane. Mr. Steward is also Chief Financial Officer of FIIA. The principal business address of each of the Directors is Beech Gate, Millfield Lane, Lower Kingswood, Tadworth, Surrey, England KT20 6RP.

PRESENT MANAGEMENT CONTRACTS
FOR EQUITY-INCOME PORTFOLIO AND GROWTH PORTFOLIO

<R>Each of Equity-Income Portfolio and Growth Portfolio has entered into a management contract with FMR, pursuant to which FMR furnishes investment advisory and other services. Under the terms of its management contract with each fund, FMR acts as investment adviser and, subject to the supervision of the Board of Trustees, has overall responsibility for directing the investments of each fund in accordance with its investment objective, policies and limitations. FMR also provides each fund with all necessary office facilities and personnel for servicing the fund's investments, compensates all officers of each fund and all Trustees who are "interested persons" of the trust or of FMR, and all personnel of each fund or FMR performing services relating to research, statistical and investment activities.</R>

In addition, FMR or its affiliates, subject to the supervision of the Board of Trustees, provide the management and administrative services necessary for the operation of each fund. These services include providing facilities for maintaining each fund's organization; supervising relations with custodians, transfer and pricing agents, accountants, underwriters and other persons dealing with each fund; preparing all general shareholder communications and conducting shareholder relations; maintaining each fund's records and the registration of each fund's shares under federal securities laws and making necessary filings under state securities laws; developing management and shareholder services for each fund; and furnishing reports, evaluations and analyses on a variety of subjects to the Trustees.

FMR is Equity-Income Portfolio's and Growth Portfolio's manager pursuant to management contracts dated November 1, 1999. The management contract for each fund was submitted to and approved by the Board of Trustees in connection with a proposal to modify the management fee to provide for lower fees when FMR's assets under management increase. Each fund's management contract was last approved by shareholders on September 16, 1998. The management contract for each fund was submitted to shareholders in connection with a proposal to modify the management fee to provide for lower fees when FMR's assets under management increase, as well as to modify the management contract subject to the requirements of the 1940 Act.

For the services of FMR under the management contract, each fund pays FMR a monthly management fee which has two components: a group fee rate and an individual fund fee rate.

The group fee rate is based on the monthly average net assets of all of the registered investment companies with which FMR has management contracts.

The group fee rate is calculated on a cumulative basis pursuant to the graduated fee rate schedule shown above on the left. The schedule above on the right shows the effective annual group fee rate at various asset levels, which is the result of cumulatively applying the annualized rates on the left. For example, the effective annual fee rate at $816 billion of group net assets - the approximate level for December 2003 - was 0.2773%, which is the weighted average of the respective fee rates for each level of group net assets up to $816 billion.

The individual fund fee rates for Equity-Income Portfolio and Growth Portfolio are 0.20 and 0.30%, respectively. Based on the average group net assets of the funds advised by FMR for December 2003, each fund's annual management fee rate would be calculated as follows:

One-twelfth of the management fee rate is applied to each fund's average net assets for the month, giving a dollar amount which is the fee for that month.

During the fiscal year ended December 31, 2003, Equity-Income Portfolio and Growth Portfolio paid FMR management fees of $41,613,933 and $52,844,117, respectively. These fees were equivalent to 0.48% and 0.58%, respectively, of the average net assets of each fund.

FMR may, from time to time, voluntarily reimburse all or a portion of a class's operating expenses (exclusive of interest, taxes, certain securities lending costs, brokerage commissions, and extraordinary expenses) , which is subject to revision or discontinuance. FMR retains the ability to be repaid for these expense reimbursements in the amount that expenses fall below the limit prior to the end of the fiscal year.

<R>FMR voluntarily agreed to reimburse each class of the funds if and to the extent that the fund's aggregate operating expenses, as a percentage of their respective average net assets exceed the following rates:</R>

Each fund also has a distribution agreement with FDC, a Massachusetts corporation organized on July 18, 1960. FDC is a broker-dealer registered under the Securities Exchange Act of 1934 and is a member of the National Association of Securities Dealers, Inc. Each distribution agreement calls for FDC to use all reasonable efforts, consistent with its other business, to secure purchasers for shares of the class, which are continuously offered at net asset value per share. Promotional and administrative expenses in connection with the offer and sale of shares are paid by FMR.

FDC received no payments from Initial Class of each fund pursuant to a Distribution and Service Plans under Rule 12b-1. The Plans do not authorize payments by the fund other than those that are to be made to FMR under its management contracts.

Currently, FDC may reallow to intermediaries (such as insurance companies, broker-dealers and other service-providers), including its affiliates, up to the full amount of 12b-1 (service) fees paid by the Service Class, Service Class R, Service Class 2, and Service Class 2R for providing support services that benefit variable product owners.

In addition to the management fee payable to FMR, each class of each fund pays transfer agent fees to Fidelity Investments Institutional Operations Company, Inc. (FIIOC), an affiliate of FMR. Each fund pays pricing and bookkeeping fees to Fidelity Service Company, Inc. (FSC), an affiliate of FMR, on behalf of each class of the fund.

Although each fund's current management contract provides that each fund will pay for typesetting, printing and mailing prospectuses, statements of additional information, notices, and reports to shareholders, the trust, on behalf of each fund has entered into a revised transfer agent agreement with FIIOC, pursuant to which FIIOC bears the costs of providing these services to existing shareholders of the applicable classes. Other expenses paid by each fund include interest, taxes, brokerage commissions, and each fund's proportionate share of insurance premiums and Investment Company Institute dues and the costs of registering shares under federal securities laws and making necessary filings under state securities laws. Each fund is also liable for such non-recurring expenses as may arise, including costs of any litigation to which each fund may be a party, and any obligation it may have to indemnify its officers and Trustees with respect to litigation.

<R>Pricing and bookkeeping fees, including reimbursement for out-of-pocket expenses, paid to FSC by Equity-Income Portfolio and Growth Portfolio for the fiscal year ended December 31, 2003 amounted to $813,809 and $832,823, respectively.</R>

<R>FSC also receives fees for administering each fund's securities lending program. Securities lending costs are based on the number and duration of individual securities loans. Securities lending costs for the fiscal year ended December 31, 2003 for Equity-Income Portfolio and Growth Portfolio were $8,414 and $9,384, respectively.</R>

SUB-ADVISORY AGREEMENTS
FOR EQUITY-INCOME PORTFOLIO AND GROWTH PORTFOLIO

FMRC. On July 7, 1999, pursuant to authority granted under SEC staff interpretations of the 1940 Act, the Board of Trustees approved, on behalf of Equity-Income Portfolio and Growth Portfolio, sub-advisory agreements between FMR and FMRC effective January 1, 2001. Pursuant to the sub-advisory agreements, FMRC has day-to-day responsibility for choosing investments for each fund.

Under the terms of the sub-advisory agreement for Equity-Income Portfolio and Growth Portfolio, FMR pays FMRC fees equal to 50% of the management fee payable to FMR under its management contract with each fund. The fees paid to FMRC are not reduced by any voluntary or mandatory expense reimbursements that may be in effect from time to time.

For the fiscal year ended December 31, 2003, FMR paid FMRC, on behalf of Equity-Income Portfolio and Growth Portfolio, fees of $20,807,987 and $26,424,060, respectively.

PORTFOLIO TRANSACTIONS
FOR EQUITY-INCOME PORTFOLIO AND GROWTH PORTFOLIO

All orders for the purchase or sale of portfolio securities are placed on behalf of Equity-Income Portfolio and Growth Portfolio by FMR pursuant to authority contained in the management contract. If FMR grants investment management authority to a sub-adviser, that sub-adviser is authorized to purchase and sell portfolio securities pursuant to the sub-advisory agreement.

FMR may place trades with certain brokers with which it is under common control, including National Financial Services LLC (NFS), provided it determines that these affiliates' trade execution abilities and costs are comparable to those of non-affiliated, qualified brokerage firms. FMR does not allocate trades to NFS in exchange for brokerage and research products and services of the type sometimes known as "soft dollars." FMR trades with its affiliated brokers on an execution-only basis. Prior to February 6, 2004, certain trades executed through NFS were transacted with Archipelago ECN (Archipelago), an ECN in which a wholly-owned subsidiary of FMR Corp. had an equity ownership interest.

The brokerage commissions paid to NFS by each fund for the fiscal year ended December 31, 2003 are listed in the following table:

^A The total amount of brokerage commissions paid by Equity-Income Portfolio and Growth Portfolio to NFS during the fiscal year ended 2003 includes commissions paid on trades transacted with Archipelago, which were previously reported separately as commissions paid to Archipelago. As restated, the brokerage commission figures more accurately reflect that Archipelago was not directly compensated by the funds. All fund trades transacted with Archipelago were executed through NFS, and therefore, NFS received any commissions paid by the funds on these trades.

The approximate percentage of aggregate brokerage commissions paid to NFS by each fund for the fiscal year ended December 31, 2003 is listed in the following table:

ADVISORY BOARD MEMBERS AND EXECUTIVE OFFICERS OF THE FUNDS

<R>Peter S. Lynch, Dennis J. Dirks, and Cornelia M. Small are Members of the Advisory Board of Variable Insurance Products Fund. The executive officers of the fund include: Ms. Johnson, Philip L. Bullen, Dwight D. Churchill, Bart A. Grenier, John B. McDowell, David L. Murphy, Matthew Conti, Stephen M. DuFour, Richard R. Mace, Jr., James K. Miller, Stephen R. Petersen, Jennifer Uhrig, Eric D. Roiter, Stuart Fross, Christine Reynolds, Timothy F. Hayes, Kenneth A. Rathgeber, John R. Hebble, Kimberley H. Monasterio, John H. Costello, Francis V. Knox, Jr., Peter L. Lydecker, Mark Osterheld, Kenneth B. Robins, and Thomas J. Simpson. Additional information about Ms. Johnson, Mr. Dirks, and Ms. Small can be found in Proposal 2. Additional information about the Members of the Advisory Board and other executive officers of the funds can be found in the following table.</R>

The executive officers and Advisory Board Members hold office without limit in time, except that any officer 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. Correspondence intended for each executive officer and Mr. Lynch may be sent to Fidelity Investments, 82 Devonshire Street, Boston, Massachusetts 02109. Mr. Dirks and Ms. Small may be sent to Fidelity Investments, P.O. Box 55235, Boston, Massachusetts 02205-5235.

* Except as otherwise indicated, each individual has held the office shown or other offices in the same company for the last five years.

STANDING COMMITTEES OF THE FUNDS' TRUSTEES

Correspondence intended for each non-interested (independent) Trustee may be sent to the attention of the individual Trustee or to the Board of Trustees at Fidelity Investments, P.O. Box 55235, Boston, Massachusetts 02205-5235. Correspondence intended for each interested Trustee may be sent to the attention of the individual Trustee or to the Board of Trustees at Fidelity Investments, 82 Devonshire Street, Boston, Massachusetts, 02109. The current process for collecting and organizing shareholder communications requires that the Board of Trustees receive copies of all communications addressed to it. All communications addressed to the Board of Trustees or any individual Trustee are logged and sent to the Board or individual Trustee. The fund does not hold annual meetings and therefore does not have a policy with regard to Trustees' attendance at such meetings. However, as a matter of practice, at least one Trustee attends special meetings.

The Board of Trustees has established various committees to facilitate the timely and efficient consideration of all matters of importance to non-interested Trustees, each fund, and fund shareholders and to facilitate compliance with legal and regulatory requirements. Currently, the Board of Trustees has 10 standing committees.

The Operations Committee is composed of all of the non-interested Trustees, with Mr. Mann currently serving as Chair. The committee normally meets monthly (except August), or more frequently as called by the Chair, and serves as a forum for consideration of issues of importance to, or calling for particular determinations by, the non-interested Trustees. The committee also considers matters involving potential conflicts of interest between the funds and FMR and its affiliates and reviews proposed contracts and the proposed continuation of contracts between the Fidelity funds and FMR and its affiliates, and annually reviews and makes recommendations regarding transfer agent and other service agreements, insurance coverage, and custody agreements. The committee also monitors additional issues including the nature, levels and quality of services provided to shareholders, significant litigation, and the voting of proxies of portfolio companies. The committee also has oversight of compliance issues not specifically in the scope of the charters of the Audit Committee or Fund Oversight Committees and considers other operating matters not specifically within the scope of oversight of any other committee. The committee is also responsible for definitive action on all compliance matters involving the potential for significant reimbursement by FMR. During the fiscal year ended December 31, 2003, the committee held 12 meetings.

The Fair Value Oversight Committee is composed of all of the non-interested Trustees, with Mr. Mann serving as Chair. The committee normally meets quarterly, or more frequently as called by the Chair, in conjunction with meetings of the Board of Trustees. The Fair Value Oversight Committee monitors and establishes policies concerning procedures and controls regarding the valuation of fund investments and their classification as liquid or illiquid and monitors matters of disclosure to the extent required to fulfill its statutory responsibilities. The committee provides oversight regarding the investment policies relating to, and Fidelity funds' investment in, non-traditional securities. The committee also reviews actions taken by FMR's Fair Value Committee. During the fiscal year ended December 31, 2003, the committee held four meetings.

The Board of Trustees has established three Fund Oversight Committees: the Equity Committee (composed of Messrs. Lautenbach (Chair), Kirk, and Stavropoulos), the Fixed-Income and International Committee (composed of Messrs. Cook (Chair) and Cox, and Ms. Knowles), and the Select and Special Committee (composed of Messrs. McCoy (Chair), Gates, and Heilmeier). Each committee normally meets monthly (except August) or more frequently as called by the Chair of the respective committee. Each committee oversees investment advisory services provided by FMR to the relevant funds and develops an understanding of and monitors the investment objectives, policies, and practices of the relevant Fidelity funds. Each committee also monitors investment performance, compliance by each relevant Fidelity fund with its investment policies and restrictions and reviews appropriate benchmarks, competitive universes, unusual or exceptional investment matters and the personnel and other resources devoted to the management of each fund. The Fixed-Income and International Committee also receives reports required under Rule 2a-7 of the 1940 Act and has oversight of research bearing on credit quality, investment structures and other fixed-income issues, and of international research. The Select and Special Committee has oversight of FMR's equity investment research. Each committee will review and recommend any required action to the Board in respect of specific funds, including new funds, changes in fundamental and non-fundamental investment policies and restrictions, partial or full closing to new investors, fund mergers, fund name changes, and liquidations of funds. The non-interested Trustees of each committee may organize working groups to make recommendations concerning issues related to funds that are within the scope of the committee's review. These working groups report to the committee or to the non-interested Trustees, or both, as appropriate. Each working group may request from FMR such information from FMR as may be appropriate to the working group's deliberations. Prior to December 2003, the Fixed-Income and International Committee was known as the Fixed-Income/International Committee, and the Select and Special Committee was known as the Select Committee. During the fiscal year ended December 31, 2003, the Equity Committee held 10 meetings, the Fixed-Income and International Committee held 11 meetings, and the Select and Special Committee held 10 meetings.

The Board of Trustees established in December 2003 two Fund Contract Committees: the Equity Contract Committee (composed of Messrs. Lautenbach (Chair), Cook, and McCoy) and the Fixed-Income Contract Committee (composed of Messrs. Cook (Chair) and Cox, and Ms. Knowles). Each committee ordinarily meets monthly during the first six months of each year and more frequently as necessary to consider matters related to the renewal of fund investment advisory agreements. The committees will assist the Board of Trustees in its consideration of investment advisory agreements of each fund. Each committee receives information on and makes recommendations concerning the approval of investment advisory agreements between the Fidelity funds and FMR and its affiliates and any non-FMR affiliate that serves as a sub-adviser to a Fidelity fund (collectively, "investment advisers") and the annual review of these contracts. The Fixed-Income Contract Committee will be responsible for investment advisory agreements of the fixed-income funds. The Equity Contract Committee will be responsible for the investment advisory agreements of all other funds. With respect to each fund under its purview, each committee: requests and receives information on the nature, levels, and quality of services provided to the shareholders of the Fidelity funds by the investment advisers and their respective affiliates, fund performance, and such other information as the committee determines to be reasonably necessary to evaluate the terms of the investment advisory agreements; considers the profitability and other benefits that the investment advisers and their respective affiliates derive from their contractual arrangements with each of the funds (including tangible and intangible "fall-out benefits"); considers methodologies for determining the extent to which the funds benefit from economies of scale and refinements to these methodologies; considers such other matters and information as may be necessary and appropriate to evaluate investment advisory agreements of the funds; and makes recommendations to the Board concerning the approval or renewal of investment advisory agreements. Each committee will consult with the other committees of the Board of Trustees, and in particular with the Audit Committee and the applicable Fund Oversight Committees, in carrying out its responsibilities. Each committee's responsibilities are guided by Sections 15(c) and 36(b) of the 1940 Act. While each committee consists solely of non-interested Trustees, its meetings may, depending upon the subject matter, be attended by one or more senior members of FMR's management or representatives of a sub-adviser not affiliated with FMR. During the fiscal year ended December 31, 2003, each Fund Contract Committee held no meetings.

The Shareholder Services, Brokerage, and Distribution Committee is composed of Messrs. Cox (Chair), Cook, Heilmeier, Lautenbach, and Stavropoulos. The committee normally meets in conjunction with in-person meetings of the Board of Trustees, or more frequently as called by the Chair. Regarding shareholder services, the committee considers the structure and amount of the Fidelity funds' transfer agency fees, custody fees, and direct fees to investors (other than sales loads), such as small account and exchange fees, and the nature and quality of services rendered by FMR and its affiliates or third parties (such as custodians) in consideration of these fees. The committee also considers other non-investment management services rendered to the Fidelity funds by FMR and its affiliates, including pricing and bookkeeping services and fees. Regarding brokerage, the committee monitors and recommends policies concerning the securities transactions of the Fidelity funds. The committee periodically reviews the policies and practices with respect to efforts to achieve best execution and commissions paid to firms supplying research and brokerage services or paying fund expenses. The committee also monitors brokerage and other similar relationships between the Fidelity funds and firms affiliated with FMR that participate in the execution of securities transactions. Regarding the distribution of fund shares, the committee considers issues bearing on the various distribution channels employed by the Fidelity funds, including issues regarding Rule 18f-3 plans and related consideration of classes of shares, sales load structures (including breakpoints), load waivers, selling concessions, and service charges paid to intermediaries, Rule 12b-1 plans, contingent deferred sales charges, and finders' fees. The committee also oversees and receives reports on the preparation and use of advertisements and sales literature for the Fidelity funds. During the fiscal year ended December 31, 2003, the Shareholder Services, Brokerage, and Distribution Committee held nine meetings.

The Audit Committee is composed of Ms. Knowles (Chair) and Messrs. Gates, Kirk, and McCoy. All committee members must be able to read and understand fundamental financial statements, including a company's balance sheet, income statement, and cash flow statement. At least one committee member will be an "audit committee financial expert" as defined by the SEC. The committee normally meets in conjunction with in-person meetings of the Board of Trustees, or more frequently as called by the Chair. The committee meets separately at least four times a year with the Fidelity funds' Treasurer, with personnel responsible for the internal audit function of FMR Corp., and with the Fidelity funds' outside auditors. The committee has direct responsibility for the appointment, compensation, and oversight of the work of the outside auditors employed by the Fidelity funds. The committee assists the Trustees in overseeing and monitoring: (i) the systems of internal accounting and financial controls of the Fidelity funds and the funds' service providers, (ii) the financial reporting processes of the Fidelity funds, (iii) the independence, objectivity, and qualification of the auditors to the Fidelity funds, (iv) the annual audits of the Fidelity funds' financial statements, and (v) the accounting policies and disclosures of the Fidelity funds. The committee considers and acts upon (i) the provision by any outside auditor of any non-audit services for any Fidelity fund, and (ii) the provision by any outside auditor of certain non-audit services to Fidelity fund service providers and their affiliates to the extent that such approval (in the case of this clause (ii)) is required under applicable regulations of the SEC. In furtherance of the foregoing, the committee has adopted (and may from time to time amend or supplement) and provides oversight of policies and procedures for non-audit engagements by outside auditors of the Fidelity funds. It is responsible for approving all audit engagement fees and terms for the Fidelity funds, resolving disagreements between a fund and any outside auditor regarding any fund's financial reporting, and has sole authority to hire and fire any auditor. Auditors of the funds report directly to the committee. The committee will obtain assurance of independence and objectivity from the outside auditors, including a formal written statement delineating all relationships between the auditor and the Fidelity funds and any service providers consistent with Independent Standards Board Standard No. 1. The committee will receive reports of compliance with provisions of the Auditor Independence Regulations relating to the hiring of employees or former employees of the outside auditors. It oversees and receives reports on the Fidelity funds' service providers' internal controls and reviews the adequacy and effectiveness of the service providers' accounting and financial controls, including: (i) any significant deficiencies or material weaknesses in the design or operation of internal controls over financial reporting that are reasonably likely to adversely affect the Fidelity funds' ability to record, process, summarize, and report financial data; (ii) any change in the fund's internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the fund's internal control over financial reporting; and (iii) any fraud, whether material or not, that involves management or other employees who have a significant role in the Fidelity funds' or service providers' internal controls over financial reporting. The committee reviews at least annually a report from each outside auditor describing any material issues raised by the most recent internal quality control, peer review, or Public Company Accounting Oversight Board examination of the auditing firm and any material issues raised by any inquiry or investigation by governmental or professional authorities of the auditing firm and in each case any steps taken to deal with such issues. The committee will oversee and receive reports on the Fidelity funds' financial reporting process, will discuss with FMR, the Fidelity funds' Treasurer, outside auditors and, if appropriate, internal audit personnel of FMR Corp. their qualitative judgments about the appropriateness and acceptability of accounting principles and financial disclosure practices used or proposed for adoption by the Fidelity funds, and will review with FMR, the Fidelity funds' Treasurer, outside auditor, and internal auditor personnel of FMR Corp. (to the extent relevant) the results of audits of the Fidelity funds' financial statements. The committee will review periodically the Fidelity funds' major internal controls exposures and the steps that have been taken to monitor and control such exposures. The committee also plays an oversight role in respect of each Fidelity fund's compliance with its name test and investment restrictions, the code of ethics relating to personal securities transactions, the code of ethics applicable to certain senior officers of the Fidelity funds, and anti-money laundering requirements. During the fiscal year ended December 31, 2003, the committee held 10 meetings.

The Governance and Nominating Committee is composed of Messrs. Mann (Chair), Cox, and Gates, each of whom is not an "interested person" (as defined in the 1940 Act). The committee has two charters: one addressing fund governance and Board administrative matters and one addressing the nomination for the appointment or election of non-interested Trustees. The committee meets as called by the Chair. The committee also recommends the establishment of committees (including ad hoc and standing committees). A current copy of the Governance and Nominating Committee Charter With Respect to Nominations of Independent Trustees is attached as Exhibit 1 to this proxy statement. The committee is also responsible for other fund governance and board administration matters. With respect to fund governance and board administration matters, the committee periodically reviews procedures and policies of the Board of Trustees and its committees (including committee charters) and periodically reviews compensation of non-interested Trustees. It acts as the administrative committee under the retirement plan for non-interested Trustees who retired prior to December 30, 1996 and under the fee deferral plan for non-interested Trustees. It reviews the performance of legal counsel employed by the Fidelity funds and the non-interested Trustees. On behalf of the non-interested Trustees, the committee will make such findings and determinations as to the independence of counsel for the non-interested Trustees as may be necessary or appropriate under applicable regulations or otherwise. The committee is also responsible for Board administrative matters applicable to non-interested Trustees, such as expense reimbursement policies and compensation for attendance at meetings, conferences and other events. The committee monitors compliance with, acts as the administrator of, and makes determinations in respect of, the provisions of the code of ethics and any supplemental policies regarding personal securities transactions applicable to the non-interested Trustees. The committee monitors regulatory and other developments to determine whether to recommend modifications to the committee's responsibilities or other Trustee policies and procedures in light of rule changes, reports concerning "best practices" in corporate governance and other developments in mutual fund governance. The committee meets with non-interested Trustees at least once a year to discuss the Statement of Policies and other matters relating to fund governance. The committee also oversees the annual self-evaluation of the non-interested Trustees. The committee makes nominations for the election or appointment of non-interested Trustees and non-management Members of any Advisory Board, and for membership on committees. The committee will have sole authority to retain and terminate any search firm used to identify non-interested Trustee candidates, including sole authority to approve such firm's fees and other retention terms. The committee will consider nominees to the Board of Trustees recommended by shareholders based upon the criteria applied to candidates presented to the committee by a search firm or other source. Recommendations, along with appropriate background material concerning the candidate that demonstrates his or her ability to serve as a non-interested Trustee of the Fidelity funds, should be submitted to the Chair of the committee at the address maintained for communications with non-interested Trustees. If the committee retains a search firm, the Chair will forward all such submissions to the search firm for evaluation. With respect to the criteria for selecting non-interested Trustees, it is expected that all candidates will possess the following minimum qualifications: (i) unquestioned personal integrity; (ii) not an "interested person" of FMR or its affiliates within the meaning of the 1940 Act; (iii) does not have a material relationship (e.g., commercial, banking, consulting, legal, or accounting) that could create an appearance of lack of independence in respect of FMR and its affiliates; (iv) has the disposition to act independently in respect of FMR and its affiliates and others in order to protect the interests of the funds and all shareholders; (v) ability to attend 11 meetings per year; (vi) demonstrates sound business judgment gained through broad experience in significant positions where the candidate has dealt with management, technical, financial, or regulatory issues; (vii) sufficient financial or accounting knowledge to add value in the complex financial environment of the Fidelity funds; (viii) experience on corporate or other institutional oversight bodies having similar responsibilities, but which board memberships or other relationships could not result in business or regulatory conflicts with the funds; and (ix) capacity for the hard work and attention to detail that is required to be an effective non-interested Trustee in light of the Fidelity funds' complex regulatory, operational, and marketing setting. The Governance and Nominating Committee may determine that a candidate who does not have the type of previous experience or knowledge referred to above should nevertheless be considered as a nominee if the Governance and Nominating Committee finds that the candidate has additional qualifications such that his or her qualifications, taken as a whole, demonstrate the same level of fitness to serve as a non-interested Trustee. During the fiscal year ended December 31, 2003, the committee held 10 meetings.

<R> INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMS </R>

<R>The firm of PricewaterhouseCoopers LLP (PwC) has been selected as the independent registered public accounting firm for Equity-Income Portfolio, Growth Portfolio, High Income Portfolio, Money Market Portfolio, and Overseas Portfolio. The firm of Deloitte & Touche LLP, the member firms of Deloitte Touche Tohmatsu, and their respective affiliates (collectively, "Deloitte Entities"), has been selected as independent registered public accounting firm for Value Portfolio. PwC and Deloitte Entities, in accordance with Independence Standards Board Standard No. 1 (ISB No.1), have confirmed to the trust's Audit Committee that they are the independent registered public accounting firms with respect to the funds.</R>

<R>The independent registered public accounting firm examines annual financial statements for the funds and provides other audit-related, non-audit, and tax-related services to the funds. Representatives of PwC and Deloitte Entities are not expected to be present at the Meeting, but have been given the opportunity to make a statement if they so desire and will be available should any matter arise requiring their presence.</R>

<R>The trust's Audit Committee must pre-approve all audit and non-audit services provided by the independent registered public accounting firms relating to the operations or financial reporting of Equity-Income Portfolio, Growth Portfolio, High Income Portfolio, Money Market Portfolio, Overseas Portfolio and Value Portfolio. Prior to the commencement of any audit or non-audit services to a fund, the Audit Committee reviews the services to determine whether they are appropriate and permissible under applicable law.</R>

The trust's Audit Committee has adopted policies and procedures to, among other purposes, provide a framework for the Committee's consideration of non-audit services by the audit firms that audit the Fidelity funds. The policies and procedures require that any non-audit service provided by a fund audit firm to a Fidelity Fund and any non-audit service provided by a fund auditor to FMR and entities controlling, controlled by, or under common control with FMR (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser) that provide ongoing services to the funds ("Fund Service Providers") that relates directly to the operations and financial reporting of a Fidelity fund (Covered Service) are subject to approval by the Audit Committee before such service is provided. Non-audit services provided by a fund audit firm for a Fund Service Provider that do not relate directly to the operations and financial reporting of a Fidelity fund (Non-Covered Service) but that are expected to exceed $50,000 are also subject to pre-approval by the Audit Committee.

All Covered Services, as well as Non-Covered Services that are expected to exceed $50,000, must be approved in advance of provision of the service either: (i) by formal resolution of the Audit Committee, or (ii) by oral or written approval of the service by the Chair of the Audit Committee (or if the Chair is unavailable, such other member of the Audit Committee as may be designated by the Chair to act in the Chair's absence). The approval contemplated by (ii) above is permitted where the Treasurer determines that action on such an engagement is necessary before the next meeting of the Audit Committee. Neither pre-approval nor advance notice of Non-Covered Service engagements for which fees are not expected to exceed $50,000 is required; such engagements are to be reported to the Audit Committee monthly.

The trust's Audit Committee has considered Non-Covered Services that were not pre-approved that were provided by PwC and Deloitte Entities to Fund Service Providers to be compatible with maintaining the independence of PwC and Deloitte Entities in their audit of the funds, taking into account representations from PwC and Deloitte Entities, in accordance with ISB No.1, regarding their independence from the funds and their related entities.

Audit Fees. For each of the fiscal years ended December 31, 2003 and December 31, 2002, the aggregate Audit Fees billed by PwC or Deloitte Entities for professional services rendered for the audits of the financial statements, or services that are normally provided in connection with statutory and regulatory filings or engagements for those fiscal years, for each fund and for all funds in the Fidelity Group of Funds are shown in the table below.

^A Aggregate amounts may reflect rounding.

Audit-Related Fees. In each of the fiscal years ended December 31, 2003 and December 31, 2002, the aggregate Audit-Related Fees billed by PwC or Deloitte Entities for services rendered for assurance and related services to each fund that are reasonably related to the performance of the audit or review of the fund's financial statements, but not reported as Audit Fees, are shown in the table below.

^A Aggregate amounts may reflect rounding.

^B Includes amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time.

In each of the fiscal years ended December 31, 2003 and December 31, 2002, the aggregate Audit-Related Fees that were billed by PwC and Deloitte Entities that were required to be approved by the Audit Committee for services rendered on behalf of the Fund Service Providers for assurance and related services that relate directly to the operations and financial reporting of each fund that are reasonably related to the performance of the audit or review of the fund's financial statements, but not reported as Audit Fees, are shown in the table below.

^A Aggregate amounts may reflect rounding.

^B Includes amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time.

<R>Fees included in the audit-related category comprise assurance and related services (e.g., due diligence services) that are traditionally performed by the independent registered public accounting firm. These audit-related services include due diligence related to mergers and acquisitions, accounting consultations and audits in connection with acquisitions, internal control reviews, attest services that are not required by statute or regulation and consultation concerning financial accounting and reporting standards.</R>

There were no amounts, including amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time, that were approved by the Audit Committee pursuant to the de minimis exception for the fiscal years ended December 31, 2003 and December 31, 2002 on behalf of each fund.

There were no amounts, including amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time, that were required to be approved by the Audit Committee pursuant to the de minimis exception for the fiscal years ended December 31, 2003 and December 31, 2002 on behalf of the Fund Service Providers that relate directly to the operations and financial reporting of each fund.

Tax Fees. In each of the fiscal years ended December 31, 2003 and December 31, 2002, the aggregate Tax Fees billed by PwC or Deloitte Entities for professional services rendered for tax compliance, tax advice, and tax planning for each fund is shown in the table below.

^A Aggregate amounts may reflect rounding.

^B Includes amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time.

In each of the fiscal years ended December 31, 2003 and December 31, 2002, the aggregate Tax Fees billed by PwC or Deloitte Entities that were required to be approved by the Audit Committee for professional services rendered on behalf of the Fund Service Providers for tax compliance, tax advice, and tax planning that relate directly to the operations and financial reporting of each fund is shown in the table below.

^A Aggregate amounts may reflect rounding.

^B Includes amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time.

<R>Fees included in the Tax Fees category comprise all services performed by professional staff in the independent registered public accounting firm's tax division except those services related to the audit. Typically, this category would include fees for tax compliance, tax planning, and tax advice. Tax compliance, tax advice, and tax planning services include preparation of original and amended tax returns, claims for refund and tax payment-planning services, assistance with tax audits and appeals, tax advice related to mergers and acquisitions and requests for rulings or technical advice from taxing authorities.</R>

There were no amounts, including amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time, that were approved by the Audit Committee pursuant to the de minimis exception for the fiscal years ended December 31, 2003 and December 31, 2002 on behalf of each fund.

There were no amounts, including amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time, that were required to be approved by the Audit Committee pursuant to the de minimis exception for the fiscal years ended December 31, 2003 and December 31, 2002 on behalf of the Fund Service Providers that relate directly to the operations and financial reporting of each fund.

All Other Fees. In each of the fiscal years ended December 31, 2003 and December 31, 2002, the aggregate Other Fees billed by PwC or Deloitte Entities for all other non-audit services rendered to the funds is shown in the table below.

^A Aggregate amounts may reflect rounding.

^B Includes amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time.

In each of the fiscal years ended December 31, 2003 and December 31, 2002, the aggregate Other Fees billed by PwC or Deloitte Entities that were required to be approved by the Audit Committee for all other non-audit services rendered on behalf of the Fund Service Providers that relate directly to the operations and financial reporting of each fund is shown in the table below.

^A Aggregate amounts may reflect rounding.

^B Includes amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time.

Fees included in the All Other Fees category include services related to internal control reviews, strategy and other consulting, financial information systems design and implementation, consulting on other information systems, and other tax services unrelated to the fund.

There were no amounts, including amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time, that were approved by the Audit Committee pursuant to the de minimis exception for the fiscal years ended December 31, 2003 and December 31, 2002 on behalf of each fund.

There were no amounts, including amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time, that were required to be approved by the Audit Committee pursuant to the de minimis exception for the fiscal years ended December 31, 2003 and December 31, 2002 on behalf of the Fund Service Providers that relate directly to the operations and financial reporting of each fund.

<R>For the fiscal years ended December 31, 2003 and December 31, 2002, the aggregate fees billed by PwC of $1,950,000 ^A,B and $1,600,000 ^A,B and Deloitte Entities of $1,450,000 ^A,B and $1,550,000 ^A,B , respectively, for non-audit services rendered on behalf of the funds, FMR (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser) and Fund Service Providers relating to Covered Services and Non-Covered Services are shown in the table below.</R>

^A Aggregate amounts may reflect rounding.

^B Includes amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time.