Fidelity Far East Class of the Fidelity Capital Structure Corp.

Transcription

1 Fidelity Far East Class of the Fidelity Capital Structure Corp. Annual Management Report of Fund Performance November,

2 Caution Regarding Forward-looking Statements Certain portions of this report, including, but not limited to, Results of Operations and Recent Developments, may contain forward-looking statements about the Fund, including its strategy, risks, expected performance and condition. Forward-looking statements include statements that are predictive in nature, that depend upon or refer to future events or conditions, or that include words such as expects, anticipates, intends, plans, believes, estimates and similar forward-looking expressions or negative versions thereof. In addition, any statement that may be made concerning future performance, strategies or prospects, and possible future Fund action, is also a forward-looking statement. Forward-looking statements are based on current expectations and projections about future events and are inherently subject to, among other things, risks, uncertainties and assumptions about the Fund and economic factors. Accordingly, assumptions concerning future economic and other factors may prove to be incorrect at a future date. Forward-looking statements are not guarantees of future performance, and actual events and results could differ materially from those expressed or implied in any forward-looking statements made by the Fund. Any number of important factors could contribute to these digressions, including, but not limited to, general economic, political and market factors in North America and internationally, interest and foreign exchange rates, global equity and capital markets, business competition, technological change, changes in government regulations, unexpected judicial or regulatory proceedings, and catastrophic events. It should be stressed that the above-mentioned list of important factors is not exhaustive. You are encouraged to consider these and other factors carefully before making any investment decisions and you are urged to avoid placing undue reliance on forward-looking statements. Further, you should be aware of the fact that the Fund has no specific intention of updating any forward-looking statements whether as a result of new information, future events or otherwise, prior to the release of the next Management Report of Fund Performance.

3 Annual Management Report of Fund Performance as at November, Fidelity Far East Class of the Fidelity Capital Structure Corp. This annual management report of fund performance contains financial highlights but does not contain the complete annual financial statements for the investment fund. You can get a copy of the annual financial statements at your request, and at no cost, by calling , by writing to us at Fidelity Investments, 483 Bay St. Suite, Toronto ON M5G 2N7 or by visiting our website at or SEDAR at Securityholders may also contact us using one of these methods to request a copy of the investment fund s proxy voting policies and procedures, proxy voting disclosure record or quarterly portfolio disclosure relating to the investment fund. Management Discussion of Fund Performance Investment Objective and Strategies Investment Objective: Fidelity Far East Class (Fund) aims to achieve long-term capital growth and seeks a return similar to that of Fidelity Far East Fund (Underlying Fund) by investing substantially all of its assets in securities of the Underlying Fund. The Underlying Fund, which is also managed by Fidelity, aims to achieve long-term capital growth by investing primarily in equity securities of companies located or operating in Southeast Asia. These countries include Australia, Hong Kong, India, Indonesia, Malaysia, New Zealand, the People s Republic of China, the Philippines, Singapore, South Korea, Taiwan and Thailand. The Underlying Fund does not invest in Japan. Strategies: When buying and selling securities for the Underlying Fund, the portfolio manager examines each company s potential for success in light of its current financial condition, its industry position and economic and market conditions. The portfolio manager considers factors such as growth potential, earnings estimates and quality of management. The Underlying Fund may invest in companies of any size, may hold cash and may invest in fixed-income securities. Risk The risks associated with investing in the Fund remain as discussed in the prospectus. Any changes to the Underlying Fund over the review period have not affected the overall level of risk of the Fund. The Fund is suitable for long-term investors who want to gain exposure to Southeast Asian companies and who can handle the volatility of returns generally associated with equity investments. To invest in the Fund, an investor should be able to accept a high level of risk. The suitability of the investment has not changed from what has been disclosed in the prospectus. Results of Operations Fidelity Far East Class Series B returned -8.7% after fees and expenses for the one-year period ended November,. The net returns of the other series of this Fund are similar to those of Series B, except for differences attributable to expense structures. The MSCI World Index, broadly representing developed global equities, returned 3.3% in Canadian dollar terms. Market overview: Worries about the trade tensions between the U.S. and China dampened investor sentiment, as Asia Pacific equities declined during the review period. However, expectations that China may further increase stimulus measures to cushion the impact of the trade tensions with the U.S. helped contain losses. The meeting between China and U.S. Presidents at the G at the end of the period gave some indication that tensions would de-escalate, but there are still many issues to resolve. The Hong Kong Monetary Authority raised its base interest rate, tracking the U.S. interest rate hike, as the Hong Kong dollar is pegged to the U.S. dollar. This, in turn, prompted commercial banks to lift their benchmark rates for the first time in 12 years. Weakness in the health care sector weighed on Taiwanese and Australian equities. Currency weakness, the impact of rising oil prices on India s trade deficit and slowing economic growth were among factors driving Indian equity market underperformance. Factors affecting performance: The Fund s benchmark, the MSCI AC (All Country) Far East ex Japan Index, returned -7.2% for the one-year period under review. The Fund underperformed its benchmark after fees and expenses, but outperformed before fees and expenses. The Underlying Fund s exposure to the consumer discretionary and utilities sectors contributed to relative performance. Within the consumer discretionary sector, the Underlying Fund s investments in China-based clothing manufacturer Shenzhou International, and lack of exposure to China-based e-commerce service JD.com contributed to relative performance as shares of JD.com declined during the review period. In the utilities sector, exposure to China-based energy distribution company ENN Energy, and Hong Kong-based electric power generation company CLP Holdings, contributed to relative performance. Among other sectors, investments in Hong Kong-based China Resource Beer Holdings, and China-based CSPC Pharmaceuticals, contributed to relative performance. In contrast, the Underlying Fund s investments in the real estate sector detracted from relative performance, led by its positions in China-based diversified real estate development company Shimao Property Holding, and lower-than-benchmark exposure to Philippines-based shopping mall operator SM Prime Holdings. Among other sectors, investments in China-based telecommunications equipment and systems company ZTE Corporation, Hong Kong-based multinational hospitality company Shangri-La Asia, and China Life Insurance detracted from relative returns. At the end of the review period, the Fund had no exposure to CSPC Pharmaceutical, CLP Holdings, Shangri-La Asia, China Life Insurance or ZTE Corporation. Portfolio changes: During the review period, portfolio manager Bruce MacDonald increased exposure to the communication services and materials sectors. In the communication services sector, the portfolio manager initiated positions in China-based Internet technology company NetEase, and telecommunication company China Unicom. NetEase is expected to leverage from success in new game launches. In the portfolio manager s view, China Unicom earnings are expected to grow due to operating leverage from its revenue growth initiatives. In the materials sector, exposure was added to Taiwan Cement as, in the portfolio manager s view, the company is expected to benefit from growing demand for its key products and tight supply given central China government control to reduce pollution levels. Additionally, in the financial sector, positions were initiated in Taiwan-based E.Sun Financial and China Construction Bank, as both have, 1

4 Fidelity Far East Class of the Fidelity Capital Structure Corp. Management Discussion of Fund Performance continued in the portfolio manager s view, strong fundamentals and potential growth prospects. Conversely, exposure was reduced to the information technology sector by exiting positions in Catcher Technology and SK Hynix, due to increasing concerns over the Dynamic random-access memory (DRAM) and NAND cycles. At a geographical level, the Underlying Fund s exposure to China and Indonesia was increased during the period, while exposure to Hong Kong was reduced. The Underlying Fund s country positioning is corollary to the portfolio manager s fundamental stock selection process. Recent Developments Effective December 31,, portfolio manager Bruce Macdonald assumed sole portfolio management responsibilities for Fidelity Far East Fund, as Eileen Dibb stepped down. Mr. MacDonald is cautiously optimistic on the outlook for earnings growth in Asian markets, and expects earnings growth to slow down as the earnings upgrade cycle has passed its peak. According to the portfolio manager, the biggest challenge facing markets is the risk of a prolonged trade war between China and the U.S. that may impact inventory levels, slow down orders, and defer investment decisions in the short term. With the cyclical portion of the Chinese economy may be, in the portfolio manager s view, past its peak, growth may not be as high but it may be better balanced driven by stable domestic consumption. Mr. MacDonald s focus on bottom-up stock selection could allow him to find opportunities in the region, especially where income growth and consumption are rising. Mr. MacDonald believes that growth is not evenly distributed across the region, and that stock selection is critical to generate excess returns. In his view, this is not an environment where passive investing will deliver outperformance. At the end of the review period, the Underlying Fund had its largest relative exposure to the financials, materials and communication services sectors. The Underlying Fund s most underweight exposure was to the real estate, industrials and consumer discretionary sectors. In terms of country exposures, the Fund had its highest relative exposure to Indonesia and Thailand, and its lowest exposure to Taiwan. The predominant industry benchmark GICS (Global Industry Classification Standard) was adjusted after the close of business on September 28, in the following ways: The Telecommunication Services sector was reconstituted and renamed the Communication Services sector. The Media industry group moved from the Consumer Discretionary sector to the newly formed Communication Services sector, where it has been renamed Media & Entertainment. Internet companies that facilitate communication (e.g., search engines and social media) and gaming software companies moved from the Information Technology sector to the Communication Services sector. Online marketplaces for consumer goods and services moved from the Information Technology sector to the Consumer Discretionary sector. In light of the above changes, there is no impact on the Fund s objective and strategy. Related Party Transactions Manager and Portfolio Adviser The Fund is managed by Fidelity Investments Canada ULC (Fidelity). Fidelity is part of a broader collection of companies collectively known as Fidelity Investments. Fidelity provides or arranges for the provision of all general management and administrative services required by the Fund in its day to day operations, bookkeeping, record keeping and other administrative services for the Fund. Fidelity is the portfolio adviser to the Fund and it provides investment advisory services to the Fund. Fidelity provides investment advice with respect to the Fund s investment portfolio and arranges for the acquisition and disposition of portfolio investments, including all necessary brokerage arrangements. The Fund pays Fidelity a monthly management and advisory fee for their services, based on the net asset value of each Series, calculated daily and payable monthly. The Fund paid Fidelity management and advisory fees of $1,73, for the period ended November,. Administration Fee Fidelity charges the Fund a fixed administration fee in place of certain variable expenses. Fidelity, in turn, pays all of the operating expenses of the Fund, other than certain specified fund costs (e.g. the fees and expenses of the Independent Review Committee, taxes, brokerage commissions and interest charges). The Fund pays an annual rate, which is calculated on a tiered basis, based on the net asset value of each Series, calculated daily and payable monthly. The Fund paid Fidelity administration fees of $156, for the period ended November,. 2

5 Financial Highlights The following tables show selected key financial information about the Fund and are intended to help you understand the Fund s financial performance for the period end of the years shown. This information is derived from the Fund s audited annual and/or unaudited semi-annual financial statements. Please see the front page for information about how you can obtain the Fund s annual or semi-annual financial statements. Fidelity Far East Class of the Fidelity Capital Structure Corp. Series A Periods ended November, Net assets, beginning of period B $ $ $ $.98 $ 28.6 Total revenue Total expenses (excluding distributions) (1.7) (.94) (.86) (.89) (.78) Realized gains (losses) Unrealized gains (losses) (9.85).4 (2.78).91 (1.46) Total increase (decrease) from operations B (4.62).43 (.78) From net investment income (excluding dividends) From dividends From capital gains (1.51) (.87) Return of capital Total distributions B,C (1.51) (.87) Net assets, end of period B $ 39.4 $ $ $ $.98 Net asset value (s) D $ 3,964 $ 3,938 $ 3,5 $ 5,77 $ 5,728 Securities outstanding D 1,596 91,951 5, ,66 184,883 Management expense ratio E,F 2.5% 2.55% 2.58% 2.6% 2.69% Management expense ratio before waivers or absorptions E,F 2.58% 2.63% 2.65% 2.67% 2.7% Trading expense ratio G.34%.34%.15%.8%.38% Portfolio turnover rate H 29.33% 8.8%.43% 19.53% 13.34% Net asset value per security, end of period $ $ $ $ $.98 Fidelity Far East Class of the Fidelity Capital Structure Corp. Series B Periods ended November, Net assets, beginning of period B $ $ $ 35.7 $ $ Total revenue Total expenses (excluding distributions) (1.2) (.89) (.8) (.84) (.72) Realized gains (losses) Unrealized gains (losses) (9.87).8 (3.12) 1.9 (.44) Total increase (decrease) from operations B (3.78) (.93) From net investment income (excluding dividends) From dividends From capital gains (1.62) (.97) Return of capital Total distributions B,C (1.62) (.97) Net assets, end of period B $.3 $ $ $ 35.7 $ Net asset value (s) D $ 21,47 $ 25,926 $ 19,727 $ 26,984 $ 26,74 Securities outstanding D 525, , , ,2 843,534 Management expense ratio E,F 2.31% 2.34% 2.36% 2.38% 2.46% Management expense ratio before waivers or absorptions E,F 2.39% 2.41% 2.41% 2.42% 2.47% Trading expense ratio G.34%.34%.15%.8%.38% Portfolio turnover rate H 29.33% 8.8%.43% 19.53% 13.34% Net asset value per security, end of period $.26 $ $ $ $

6 Financial Highlights continued Fidelity Far East Class of the Fidelity Capital Structure Corp. Series F Periods ended November, Net assets, beginning of period B $ 5.77 $ 39.7 $ $ $ 33. Total revenue Total expenses (excluding distributions) (.6) (.54) (.48) (.5) (.47) Realized gains (losses) Unrealized gains (losses) (12.3) (2.58) Total increase (decrease) from operations B (5.4) From net investment income (excluding dividends) From dividends From capital gains (2.32) (1.61) Return of capital Total distributions B,C (2.32) (1.61) Net assets, end of period B $ $ 5.77 $ 39.7 $ $ Net asset value (s) D $ 18,474 $ 16,813 $ 8,252 $ 13,684 $ 6,615 Securities outstanding D 393, ,226 7,962 3,3 182,146 Management expense ratio E,F 1.18% 1.22% 1.23% 1.24% 1.% Management expense ratio before waivers or absorptions E,F 1.23% 1.% 1.% 1.34% 1.42% Trading expense ratio G.34%.34%.15%.8%.38% Portfolio turnover rate H 29.33% 8.8%.43% 19.53% 13.34% Net asset value per security, end of period $ $ $ $ $ Fidelity Far East Class of the Fidelity Capital Structure Corp. Series F5 Periods ended November, Net assets, beginning of period B $ $ $ $ $ Total revenue Total expenses (excluding distributions) (.33) (.31) (.28) (.27) (.31) Realized gains (losses) Unrealized gains (losses) (4.12).3 (1.55) Total increase (decrease) from operations B (2.87) From net investment income (excluding dividends) From dividends From capital gains (1.32) (.99) Return of capital (1.) (1.) (1.) (1.) (1.) Total distributions B,C (1.) (2.62) (2.29) (1.) (1.) Net assets, end of period B $ $ $ $ $ Net asset value (s) D $ 264 $ 2 $ 1 $ 1 $ 1 Securities outstanding D 11,29 8, Management expense ratio E,F 1.23% 1.21% 1.% 1.13% 1.42% Management expense ratio before waivers or absorptions E,F 1.28% 1.% 1.% 1.18% 1.44% Trading expense ratio G.34%.34%.15%.8%.38% Portfolio turnover rate H 29.33% 8.8%.43% 19.53% 13.34% Net asset value per security, end of period $ $ $ $ $

7 Fidelity Far East Class of the Fidelity Capital Structure Corp. Series F8 Periods ended November, Net assets, beginning of period B $ 24. $.53 $ 23. $ $ Total revenue Total expenses (excluding distributions) (.27) (.25) (.24) (.29) (.31) Realized gains (losses) Unrealized gains (losses) (5.46) 6.26 (2.) (3.64) (.19) Total increase (decrease) from operations B (2.14) 6.73 (1.34) (3.54) 2. From net investment income (excluding dividends) From dividends From capital gains (1.21) (.89) Return of capital (1.6) (1.6) (1.6) (1.6) (1.6) Total distributions B,C (1.6) (2.81) (2.49) (1.6) (1.6) Net assets, end of period B $ 21.8 $ 24. $.53 $ 23. $ Net asset value (s) D $ 32 $ 31 $ 23 $ 14 $ 1 Securities outstanding D 1,523 1,288 1, Management expense ratio E,F 1.13% 1.15% 1.17% 1.24% 1.45% Management expense ratio before waivers or absorptions E,F 1.18% 1.22% 1.23% 1.33% 1.45% Trading expense ratio G.34%.34%.15%.8%.38% Portfolio turnover rate H 29.33% 8.8%.43% 19.53% 13.34% Net asset value per security, end of period $ $ 24.6 $.5329 $ $ Fidelity Far East Class of the Fidelity Capital Structure Corp. Series T5 Periods ended November, Net assets, beginning of period B $ $ 21.7 $ $ $ Total revenue Total expenses (excluding distributions) (.65) (.58) (.58) (.64) (.59) Realized gains (losses) Unrealized gains (losses) (4.5) 5.56 (1.54) Total increase (decrease) from operations B (3.) 6.32 (.33) From net investment income (excluding dividends) From dividends From capital gains (.97) (.59) Return of capital (1.25) (1.25) (1.25) (1.8) (1.) Total distributions B,C (1.25) (2.22) (1.84) (1.8) (1.) Net assets, end of period B $ $ $ 21.7 $ $ Net asset value (s) D $ 53 $ $ 32 $ 27 $ 25 Securities outstanding D 2, ,468 1,124 1,122 Management expense ratio E,F 2.59% 2.6% 2.61% 2.63% 2.78% Management expense ratio before waivers or absorptions E,F 2.67% 2.67% 2.67% 2.72% 2.8% Trading expense ratio G.34%.34%.15%.8%.38% Portfolio turnover rate H 29.33% 8.8%.43% 19.53% 13.34% Net asset value per security, end of period $ $ $ $ $

8 Financial Highlights continued Fidelity Far East Class of the Fidelity Capital Structure Corp. Series T8 Periods ended November, Net assets, beginning of period B $ 23. $ $ $ 21. $ Total revenue Total expenses (excluding distributions) (.57) (.56) (.54) (.59) (.54) Realized gains (losses) Unrealized gains (losses) (4.81) 5.83 (1.58) (.94) 4.43 Total increase (decrease) from operations B (3.55) 5.7 (.34) From net investment income (excluding dividends) From dividends From capital gains (.87) (.55) Return of capital (1.6) (1.6) (1.6) (1.6) (1.6) Total distributions B,C (1.6) (2.47) (2.15) (1.6) (1.6) Net assets, end of period B $ $ 23. $ $ $ 21. Net asset value (s) D $ 825 $ 163 $ 33 $ 44 $ 12 Securities outstanding D 41,58 6,951 1,681 1, Management expense ratio E,F 2.6% 2.62% 2.65% 2.62% 2.68% Management expense ratio before waivers or absorptions E,F 2.68% 2.71% 2.71% 2.7% 2.75% Trading expense ratio G.34%.34%.15%.8%.38% Portfolio turnover rate H 29.33% 8.8%.43% 19.53% 13.34% Net asset value per security, end of period $ $ $ $ $ Fidelity Far East Class of the Fidelity Capital Structure Corp. Series S5 Periods ended November, Net assets, beginning of period B $ $ $ 24.6 $ $ Total revenue Total expenses (excluding distributions) (.61) (.56) (.54) (.59) (.49) Realized gains (losses) Unrealized gains (losses) (3.9) 7.98 (1.49) (2.81) (4.55) Total increase (decrease) from operations B (2.65) 7.96 (.28) (1.26) (3.52) From net investment income (excluding dividends) From dividends From capital gains (1.2) (.64) Return of capital (1.26) (1.26) (1.26) (1.9) (1.) Total distributions B,C (1.26) (2.28) (1.9) (1.9) (1.) Net assets, end of period B $ 23.2 $ $ $ 24.6 $ Net asset value (s) D $ 323 $ $ 9 $ 9 $ 1 Securities outstanding D 14,32 1, Management expense ratio E,F 2.34% 2.39% 2.42% 2.43% 2.54% Management expense ratio before waivers or absorptions E,F 2.41% 2.46% 2.46% 2.46% 2.54% Trading expense ratio G.34%.34%.15%.8%.38% Portfolio turnover rate H 29.33% 8.8%.43% 19.53% 13.34% Net asset value per security, end of period $ $ $ $ $

9 Fidelity Far East Class of the Fidelity Capital Structure Corp. Series S8 Periods ended November, Net assets, beginning of period B $ $ $ $ $ Total revenue Total expenses (excluding distributions) (.51) (.49) (.48) (.54) (.53) Realized gains (losses) Unrealized gains (losses) (7.57) (.) (1.32) Total increase (decrease) from operations B 1.6 (.47) (.21) From net investment income (excluding dividends) From dividends From capital gains (.93) (.59) Return of capital (1.6) (1.6) (1.6) (1.6) (1.6) Total distributions B,C (1.6) (2.53) (2.19) (1.6) (1.6) Net assets, end of period B $.6 $ $ $ $ Net asset value (s) D $ 993 $ 3,53 $ 51 $ 51 $ 14 Securities outstanding D 49, ,671 2,582 2, Management expense ratio E,F 2.26% 2.33% 2.36% 2.42% 2.55% Management expense ratio before waivers or absorptions E,F 2.34% 2.41% 2.% 2.48% 2.58% Trading expense ratio G.34%.34%.15%.8%.38% Portfolio turnover rate H 29.33% 8.8%.43% 19.53% 13.34% Net asset value per security, end of period $.55 $ $ $ $ Fidelity Far East Class of the Fidelity Capital Structure Corp. Series E1 Periods ended November, I Net assets, beginning of period B $ $.78 $. Total revenue Total expenses (excluding distributions) (.31) (.28) (.) Realized gains (losses) Unrealized gains (losses) (3.1) Total increase (decrease) from operations B (1.29) From net investment income (excluding dividends) From dividends From capital gains (.52) Return of capital Total distributions B,C (.52) Net assets, end of period B $ 12.6 $ $.78 Net asset value (s) D $ 5,724 $ 5,855 $ 2,552 Securities outstanding D 454, , ,645 Management expense ratio E,J 2.24% 2.28% 2.% Management expense ratio before waivers or absorptions E,J 2.32% 2.35% 2.35% Trading expense ratio G.34%.34%.15% Portfolio turnover rate H 29.33% 8.8%.43% Net asset value per security, end of period $ $ $

10 Financial Highlights continued Fidelity Far East Class of the Fidelity Capital Structure Corp. Series E1T5 Periods ended November, K Net assets, beginning of period B $. Total revenue Total expenses (excluding distributions) (.14) Realized gains (losses).24 Unrealized gains (losses) (2.13) Total increase (decrease) from operations B (2.3) From net investment income (excluding dividends) From dividends From capital gains Return of capital (.42) Total distributions B,C (.42) Net assets, end of period B $ Net asset value (s) D $ 536 Securities outstanding D,5 Management expense ratio E,L 2.13% Management expense ratio before waivers or absorptions E,L 2.19% Trading expense ratio G.34% Portfolio turnover rate H 29.33% Net asset value per security, end of period $ Fidelity Far East Class of the Fidelity Capital Structure Corp. Series E2 Periods ended November, I Net assets, beginning of period B $ $.8 $. Total revenue.15.6 Total expenses (excluding distributions) (.) (.26) (.19) Realized gains (losses) Unrealized gains (losses) (3.2) Total increase (decrease) from operations B (1.25) From net investment income (excluding dividends) From dividends From capital gains (.53) Return of capital Total distributions B,C (.53) Net assets, end of period B $ $ $.8 Net asset value (s) D $ 2,3 $ 1,878 $ 453 Securities outstanding D 158, ,939 41,92 Management expense ratio E,J 2.17% 2.11% 2.15% Management expense ratio before waivers or absorptions E,J 2.24% 2.19% 2.19% Trading expense ratio G.34%.34%.15% Portfolio turnover rate H 29.33% 8.8%.43% Net asset value per security, end of period $ $ $

11 Fidelity Far East Class of the Fidelity Capital Structure Corp. Series E3 Periods ended November, I Net assets, beginning of period B $ $.8 $. Total revenue.17.4 Total expenses (excluding distributions) (.) (.27) (.19) Realized gains (losses) Unrealized gains (losses) (2.85) Total increase (decrease) from operations B (.88) From net investment income (excluding dividends) From dividends From capital gains (.53) Return of capital Total distributions B,C (.53) Net assets, end of period B $ $ $.8 Net asset value (s) D $ 69 $ $ 8 Securities outstanding D 5,429 7, Management expense ratio E,J 2.17% 2.14% 2.18% Management expense ratio before waivers or absorptions E,J 2.25% 2.23% 2.24% Trading expense ratio G.34%.34%.15% Portfolio turnover rate H 29.33% 8.8%.43% Net asset value per security, end of period $ $ $.7982 Fidelity Far East Class of the Fidelity Capital Structure Corp. Series E4 Periods ended November, I Net assets, beginning of period B $ $.82 $. Total revenue.54.3 Total expenses (excluding distributions) (.28) (.26) (.17) Realized gains (losses) Unrealized gains (losses) (6.38) Total increase (decrease) from operations B From net investment income (excluding dividends) From dividends From capital gains (.56) Return of capital Total distributions B,C (.56) Net assets, end of period B $ $ $.82 Net asset value (s) D $ 1 $ 12 $ 1 Securities outstanding D Management expense ratio E,J 2.4% 2.8% 1.94% Management expense ratio before waivers or absorptions E,J 2.19% 2.19% 2.33% Trading expense ratio G.34%.34%.15% Portfolio turnover rate H 29.33% 8.8%.43% Net asset value per security, end of period $ $ $

12 Financial Highlights continued Fidelity Far East Class of the Fidelity Capital Structure Corp. Series P1 Periods ended November, M Net assets, beginning of period B $ $ 9.52 $. Total revenue Total expenses (excluding distributions) (.13) (.12) (.) Realized gains (losses) Unrealized gains (losses) (2.82) 3.21 (.23) Total increase (decrease) from operations B (1.6) From net investment income (excluding dividends) From dividends From capital gains (.57) (.39) Return of capital Total distributions B,C (.57) (.39) Net assets, end of period B $ $ $ 9.52 Net asset value (s) D $ 8,48 $ 9,112 $ 3,679 Securities outstanding D 714,967 75, ,576 Management expense ratio E,N 1.% 1.13% 1.13% Management expense ratio before waivers or absorptions E,N 1.15% 1.21% 1.19% Trading expense ratio G.34%.34%.15% Portfolio turnover rate H 29.33% 8.8%.43% Net asset value per security, end of period $ $ $ Fidelity Far East Class of the Fidelity Capital Structure Corp. Series P1T5 Periods ended November, O Net assets, beginning of period B $. Total revenue.5 Total expenses (excluding distributions) (.) Realized gains (losses) 1.4 Unrealized gains (losses) (3.95) Total increase (decrease) from operations B (3.6) From net investment income (excluding dividends) From dividends From capital gains Return of capital (1.) Total distributions B,C (1.) Net assets, end of period B $ Net asset value (s) D $ 53 Securities outstanding D 28,798 Management expense ratio E,P 1.% Management expense ratio before waivers or absorptions E,P 1.14% Trading expense ratio G.34% Portfolio turnover rate H 29.33% Net asset value per security, end of period $

13 Fidelity Far East Class of the Fidelity Capital Structure Corp. Series P2 Periods ended November, M Net assets, beginning of period B $ $ 9.52 $. Total revenue Total expenses (excluding distributions) (.13) (.11) (.) Realized gains (losses) Unrealized gains (losses) (2.98) Total increase (decrease) from operations B (.95) From net investment income (excluding dividends) From dividends From capital gains (.57) (.39) Return of capital Total distributions B,C (.57) (.39) Net assets, end of period B $ $ $ 9.52 Net asset value (s) D $ 3,85 $ 3,86 $ 1,6 Securities outstanding D 274,47 317, ,633 Management expense ratio E,N 1.3% 1.4% 1.6% Management expense ratio before waivers or absorptions E,N 1.9% 1.13% 1.12% Trading expense ratio G.34%.34%.15% Portfolio turnover rate H 29.33% 8.8%.43% Net asset value per security, end of period $ $ $ 9.54 Fidelity Far East Class of the Fidelity Capital Structure Corp. Series P2T5 Periods ended November, O Net assets, beginning of period B $. Total revenue.21 Total expenses (excluding distributions) (.) Realized gains (losses) 2.73 Unrealized gains (losses) (3.42) Total increase (decrease) from operations B (.68) From net investment income (excluding dividends) From dividends From capital gains Return of capital (1.) Total distributions B,C (1.) Net assets, end of period B $ Net asset value (s) D $ 13 Securities outstanding D 759 Management expense ratio E,P 1.6% Management expense ratio before waivers or absorptions E,P 1.11% Trading expense ratio G.34% Portfolio turnover rate H 29.33% Net asset value per security, end of period $

14 Financial Highlights continued Fidelity Far East Class of the Fidelity Capital Structure Corp. Series P3 Periods ended November, M Net assets, beginning of period B $ 12. $ 9.53 $. Total revenue.11 Total expenses (excluding distributions) (.11) (.11) (.9) Realized gains (losses) Unrealized gains (losses) (1.49) Total increase (decrease) from operations B (.7) From net investment income (excluding dividends) From dividends From capital gains (.58) (.39) Return of capital Total distributions B,C (.58) (.39) Net assets, end of period B $ 11. $ 12. $ 9.53 Net asset value (s) D $ 1,551 $ 1,324 $ 77 Securities outstanding D 137,326 8,5 8,53 Management expense ratio E,N.93%.98% 1.2% Management expense ratio before waivers or absorptions E,N.98% 1.8% 1.8% Trading expense ratio G.34%.34%.15% Portfolio turnover rate H 29.33% 8.8%.43% Net asset value per security, end of period $ $ 12.5 $ Fidelity Far East Class of the Fidelity Capital Structure Corp. Series P4 Periods ended November, M Net assets, beginning of period B $ 12. $ 9.54 $. Total revenue.4.22 Total expenses (excluding distributions) (.12) (.) (.9) Realized gains (losses) Unrealized gains (losses) (2.36) 2.56 (3.73) Total increase (decrease) from operations B (1.72) 2.97 (3.52) From net investment income (excluding dividends) From dividends From capital gains (.58) (.39) Return of capital Total distributions B,C (.58) (.39) Net assets, end of period B $ $ 12. $ 9.54 Net asset value (s) D $ 25 $ 1 $ 956 Securities outstanding D 22,96 111,265 Management expense ratio E,N.93%.96%.97% Management expense ratio before waivers or absorptions E,N.97% 1.3% 1.4% Trading expense ratio G.34%.34%.15% Portfolio turnover rate H 29.33% 8.8%.43% Net asset value per security, end of period $ $ $

15 Fidelity Far East Class of the Fidelity Capital Structure Corp. Series P5 Periods ended November, Q Net assets, beginning of period B $ $. Total revenue.11 Total expenses (excluding distributions) (.) (.4) Realized gains (losses) Unrealized gains (losses) (2.29) 1.33 Total increase (decrease) from operations B (.86) 1.32 From net investment income (excluding dividends) From dividends From capital gains Return of capital Total distributions B,C Net assets, end of period B $.49 $ Net asset value (s) D $ 1,493 $ 1,1 Securities outstanding D 142, ,895 Management expense ratio E,R.89%.91% Management expense ratio before waivers or absorptions E,R.94% 1.1% Trading expense ratio G.34%.34% Portfolio turnover rate H 29.33% 8.8% Net asset value per security, end of period $.4855 $

16 Financial Highlights continued Financial Highlights Footnotes A This information is derived from the Fund s audited annual and/or unaudited interim financial statements. Periods beginning on or after January 1, follow International Financial Reporting Standards (IFRS) and periods prior to January 1, follow Canadian Generally Accepted Accounting Principles (Canadian GAAP). The net assets attributable to securityholders per security presented in the financial statements may differ from the net asset value calculated for fund pricing purposes. An explanation of these differences can be found in the notes to financial statements. For reporting periods ending after January 1, per security comparative figures (except for net asset value per security, end of period) have been conformed to the current rounding presentation of two decimal places. As a result, reporting periods ending prior to January 1, may not foot due to this rounding change. B Net assets and distributions are based on the actual number of securities outstanding at the relevant time. The increase (decrease) from operations is based on the weighted average number of securities outstanding over the financial period. This table is not intended to be a reconciliation of beginning to ending net assets per security. C Distributions were paid in cash or reinvested in additional securities of the Fund, or both, and excludes any applicable distributions of management fee reduction to securityholders. D This information is provided as at period end of the year shown. E Management expense ratio is based on total expenses (excluding distributions, commissions and other portfolio transaction costs) for the stated period and is expressed as an annualized percentage of daily average net asset values during the period, including the Fund s pro-rata share of estimated expenses incurred in any underlying investment fund, if applicable. F Effective November 1,, the manager of the Fund has waived a portion of its administration fee and as of the date of the MRFP has continued to provide the Fund with such waivers. The manager may terminate the waiver at any time, at its sole discretion. It is not known when such waivers will be terminated. G The trading expense ratio represents total commissions and other portfolio transaction costs expressed as an annualized percentage of daily average net asset value during the period, including the Fund s pro-rata share of estimated trading costs incurred in any underlying investment fund, if applicable. H The Fund s portfolio turnover rate indicates how actively the Fund s portfolio adviser manages its portfolio investments. A portfolio turnover rate of % is equivalent to the Fund buying and selling all of the securities in its portfolio once in the course of the year. The higher the Fund s portfolio turnover rate in a year, the greater the trading costs payable by the Fund in the year, and the greater chance of an investor receiving taxable capital gains in the year. There is not necessarily a relationship between a high portfolio turnover rate and the performance of the Fund. The portfolio turnover rate is calculated based on the lesser of purchases or sales of securities divided by the weighted average market value of the portfolio securities, excluding short-term securities. For periods greater than six months, but less than a full fiscal year, the portfolio turnover rate is annualized. I For the period February 5, (commencement of sale of securities) to November,. J Effective February 9,, the manager of the Fund has waived a portion of its administration fee and as of the date of the MRFP has continued to provide the Fund with such waivers. The manager may terminate the waiver at any time, at its sole discretion. It is not known when such waivers will be terminated. K For the period July, (commencement of sale of securities) to November,. L Effective July 24,, the manager of the Fund has waived a portion of its administration fee and as of the date of the MRFP has continued to provide the Fund with such waivers. The manager may terminate the waiver at any time, at its sole discretion. It is not known when such waivers will be terminated. M For the period December 4, (commencement of sale of securities) to November,. N Effective December 8,, the manager of the Fund has waived a portion of its administration fee and as of the date of the MRFP has continued to provide the Fund with such waivers. The manager may terminate the waiver at any time, at its sole discretion. It is not known when such waivers will be terminated. O For the period December 13, (commencement of sale of securities) to November,. P Effective December 15,, the manager of the Fund has waived a portion of its administration fee and as of the date of the MRFP has continued to provide the Fund with such waivers. The manager may terminate the waiver at any time, at its sole discretion. It is not known when such waivers will be terminated. Q For the period July 14, (commencement of sale of securities) to November,. R Effective July 18,, the manager of the Fund has waived a portion of its administration fee and as of the date of the MRFP has continued to provide the Fund with such waivers. The manager may terminate the waiver at any time, at its sole discretion. It is not known when such waivers will be terminated. 14

17 Management and Advisory Fees Fidelity serves as manager of the Fund. The Fund pays Fidelity a monthly management fee for its services, based on the net asset value of each Series, calculated daily and payable monthly. Fidelity uses these management fees to pay for sales and trailing commissions to registered dealers on the distribution of the Fund securities, as well as for general investment management expenses. Dealer compensation represents cash commissions paid by Fidelity to registered dealers during the period and includes upfront deferred sales charge and trailing commissions. This amount may, in certain circumstances, exceed % of the fees earned by Fidelity during the period. For new Funds or Series the amounts presented may not be indicative of longer term operating periods. Management Fees Dealer Compensation Investment management, administration and other Series A 2.% 81.56% 18.44% Series B 1.85% 54.5% 45.95% Series F.85%.% Series F5.85%.% Series F8.85%.% Series T5 2.% 44.89% 55.11% Series T8 2.% % % Series S5 1.85% 54.5% 45.95% Series S8 1.85% 54.5% 45.95% Series E % 54.79% 45.21% Series E1T % 54.79% 45.21% Series E2 1.8% 55.56% 44.44% Series E % 56.34% 43.66% Series E % 57.97% 42.3% Series P1.825%.% Series P1T5.825%.% Series P2.8%.% Series P2T5.8%.% Series P3.775%.% Series P4.725%.% Series P5.675%.% 15

18 Fidelity Far East Class of the Fidelity Capital Structure Corp. Past Performance The performance information shown assumes that all distributions made by the Fund in the periods shown were reinvested in additional securities of the Fund. The performance information does not take into account sales, redemption, distribution or other optional charges that would have reduced returns or performance. How the Fund has performed in the past does not necessarily indicate how it will perform in the future. The performance data shown for the period occurring prior to the commencement of operations of a series P or E is that of the corresponding series F or F5 (for series P) or B or S5 (for series E). Series F, F5, B and S5 have higher combined management and administration fees than the applicable series P and E. Had a series P or E existed since the commencement of operations of series F, F5, B or S5, the returns of the applicable series P or E would have been higher. Year-by-Year Returns The following bar chart shows the Fund s annual performance for each of the years shown, and illustrates how the Fund s performance was changed from year to year. In percentage terms, the bar chart shows how much an investment made on the first day of each financial year would have grown or decreased by the last day of each financial year. Series A Series F Series B Commencement of Operations is April 17, Series F Series F Commencement of Operations is April 17, Series T Commencement of Operations is April 17, 16

19 Series T8 E1T Commencement of Operations is April 17, Commencement of Operations is July, Series S5 Series E Commencement of Operations is April 17, Series S8 Commencement of Operations is February 5, Series E Commencement of Operations is April 17, Series E1 Commencement of Operations is February 5, Series E Commencement of Operations is February 5, Commencement of Operations is February 5, 17

20 Fidelity Far East Class of the Fidelity Capital Structure Corp. Past Performance continued Series P1 Series P Commencement of Operations is December 4, Series P1T5 Commencement of Operations is December 4, Series P Commencement of Operations is December 13, Series P2 Commencement of Operations is December 4, Series P Commencement of Operations is December 4, Commencement of Operations is July 14, Series P2T Commencement of Operations is December 13, 18

21 Annual Compound Returns This table shows the Fund s historical annual compound total returns for the periods indicated, compared with a broad-based index, the MSCI World Index and the Fund s benchmark, the MSCI AC (All Country) Far East ex Japan Index, as described below. Average Annual Total Returns Series A (8.8)% 6.4% 8.% 11.1% n/a Series B (8.7)% 6.6% 8.2% 11.4% n/a Series F (7.6)% 7.8% 9.4% 12.6% n/a Series F5 (7.7)% 7.8% 9.4% n/a.5% Series F8 (7.6)% 7.9% 9.5% n/a.5% Series T5 (8.9)% 6.3% 7.9% n/a 9.% Series T8 (8.9)% 6.3% 7.9% n/a 9.% Series S5 (8.7)% 6.6% 8.2% n/a 9.2% Series S8 (8.6)% 6.6% 8.2% n/a 9.2% Series E1 (8.6)% 6.7% 8.2% 11.4% n/a E1T5 (8.6)% 6.6% 8.2% n/a 9.2% Series E2 (8.5)% 6.8% 8.3% 11.4% n/a Series E3 (8.6)% 6.8% 8.3% 11.4% n/a Series E4 (8.4)% 6.9% 8.4% 11.5% n/a Series P1 (7.6)% 7.9% 9.5% 12.6% n/a Series P1T5 (7.6)% 7.9% 9.5% n/a.5% Series P2 (7.5)% 8.% 9.5% 12.6% n/a Series P2T5 (7.6)% 7.9% 9.5% n/a.5% Series P3 (7.4)% 8.1% 9.6% 12.7% n/a Series P4 (7.4)% 8.1% 9.6% 12.7% n/a Series P5 (7.4)% 8.% 9.5% 12.6% n/a MSCI AC (All Country) Far East ex Japan Index (7.2)% 9.7% 9.1% 12.6%.2% MSCI World Index 3.3% 8.4% 11.6% 11.6% 13.8% A discussion of the performance of the fund can be found in the Results of Operations section of this report. The MSCI AC (All Country) Far East ex Japan Index is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of the Far East, excluding Japan. The MSCI World Index is a market capitalization weighted index composed of companies representative of the market structure of Developed Market countries in North America, Europe and the Asia/Pacific Region. Each Series will have different returns because of differences in management fees and expenses. Past 1 year Past 3 years Past 5 years Past years Since Inception 19

22 Fidelity Far East Class of the Fidelity Capital Structure Corp. Summary of Investment Portfolio as at November, Sector Mix % of Fund s Net Assets as at 11//18 % of Fund s Net Assets as at 11//17 Financials Information Technology Communication Services Consumer Discretionary Materials Consumer Staples Utilities Industrials 2.3. Energy 2.1. Health Care Others (Individually Less Than 1%). 2. Cash and Cash Equivalents Net Other Assets (Liabilities) (.1) (.1) Geographic Mix % of Fund s Net Assets as at 11//18 % of Fund s Net Assets as at 11//17 Cayman Islands Korea (South) China Taiwan Hong Kong Thailand Indonesia Singapore India Others (Individually Less Than 1%) Cash and Cash Equivalents Net Other Assets (Liabilities) (.1) (.1) Top Issuers % of Fund s Net Assets 1. Tencent Holdings Ltd Alibaba Group Holding Ltd Taiwan Semiconductor Manufacturing Co. Ltd Samsung Electronics Co. Ltd AIA Group Ltd China Construction Bank Corp Ping An Insurance (Group) Co. of China Ltd PT Bank Central Asia Tbk DBS Group Holdings Ltd Shenzhou International Group Holdings Ltd Electricity Generating PCL Industrial & Commercial Bank of China Ltd E.SUN Financial Holdings Co. Ltd PT Telekomunikasi Indonesia Tbk HDFC Bank Ltd NetEase, Inc KB Financial Group, Inc LG Chemical Ltd CNOOC Ltd C.P. ALL PCL China Resources Beer Holdings Co. Ltd Samsung SDI Co. Ltd Taiwan Cement Corp Kweichow Moutai Co. Ltd Hyundai Fire & Marine Insurance Co. Ltd. 1.9 Total Fund Net Assets $69,238, 85.3 Where applicable, the information in the above tables includes the Fund s pro-rata share of the investment in any Fidelity managed underlying fund. The summary of investment portfolio may change due to ongoing portfolio transactions of the investment fund. The most recent annual report, semi-annual report, quarterly report, fund facts document or simplified prospectus for the investment fund and/or underlying fund is available at no cost, by calling , by writing to us at Fidelity Investments Canada ULC, 483 Bay St. Suite, Toronto ON M5G 2N7 or by visiting our web site at or SEDAR at

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24 Fidelity Capital Structure Corp. 7 2nd Street S.W., Suite 8 Calgary, Alberta T2P 2Y3 Manager and Registrar Fidelity Investments Canada ULC 483 Bay Street, Suite Toronto, Ontario M5G 2N7 Custodian State Street Trust Company of Canada Toronto, Ontario Visit us online at or call Fidelity Client Services at Fidelity s mutual funds are sold by registered Investment Professionals. Each Fund has a simplified prospectus, which contains important information on the Fund, including its investment objective, purchase options, and applicable charges. Please obtain a copy of the prospectus, read it carefully, and consult your Investment Professional before investing. As with any investment, there are risks to investing in mutual funds. There is no assurance that any Fund will achieve its investment objective, and its net asset value, yield, and investment return will fluctuate from time to time with market conditions. Investors may experience a gain or loss when they sell their securities in any Fidelity Fund. Fidelity Global Funds may be more volatile than other Fidelity Funds as they concentrate investments in one sector and in fewer issuers; no single Fund is intended to be a complete diversified investment program. Past performance is no assurance or indicator of future returns. There is no assurance that either Fidelity Canadian Money Market Fund, Fidelity U.S. Money Market Fund or Fidelity U.S. Money Market Investment Trust will be able to maintain its net asset value at a constant amount. The breakdown of Fund investments is presented to illustrate the way in which a Fund may invest, and may not be representative of a Fund s current or future investments. A Fund s investments may change at any time. Fidelity Investments is a registered trademark of Fidelity Investments Canada ULC E FICL-FE-CS-MRFPA-219