Fidelity Global Financial Services Fund

Transcription

1 Fidelity Global Financial Services Fund Annual Management Report of Fund Performance March 31, 2017

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 March 31, 2017 Fidelity Global Financial Services Fund 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 300, 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 Global Financial Services Fund (Fund) aims to achieve long-term capital growth by investing primarily in equity securities of companies anywhere in the world that provide financial services. Strategies: When buying and selling securities for the 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 like growth potential, earnings estimates and quality of management. The Fund may invest in small, medium and large companies and may hold cash and invest in fixed-income securities. Risk The risks associated with investing in this Fund remain as discussed in the prospectus. Any changes to the Fund over the period have not affected the overall level of risk of the Fund. The Fund is suitable for long-term investors wanting to gain exposure to financial services companies anywhere in the world, who can handle the volatility of returns generally associated with equity investments and who are willing to accept a medium to high level of risk. The suitability of the Fund has not changed from what has been disclosed in the prospectus. Results of Operations The Fidelity Global Financial Services Fund (Fund), Series B, returned 19.1%, after fees and expenses for the one-year period ended March 31, The net returns of the other series of this Fund are similar to those of Series B, except for differences attributable to expense structures. During the review period, global equities, as represented by the MSCI World Index, returned 18.3% (in Canadian dollar terms). Market overview: Global equities registered positive returns during the review period. The U.S. was the best performing market, driven by positive economic data and optimism surrounding the proposed policies of the new U.S. administration. Canadian markets performed well amid a recovery in commodity prices, especially metals and oil, and an improved economic environment. European markets lagged global markets as political uncertaianty weighed on investors. Factors affecting performance: The Fund s benchmark, the MSCI ACWI (All Country World Index) Financials and Real Estate Index Blend, returned 25.6% in Canadian dollar terms for the period under review. The Fund underperformed its benchmark due to its exposure to certain stocks in the real estate management and development industry, as these stocks were sold off in the second half of 2016, when bond yields rose and investors favoured more cyclical areas of the market. Within the industry, investment in Luxemberg-based real estate management firm Grand City Properties detracted from relative returns. In addition, investment in certain insurance firms such as U.S.-based insurance firm Hartford Financial Services, detracted from relative returns. Among other industries, investment in U.K.-based retail bank Virgin Money Holdings, and a lower-than-benchmark exposure to U.S.-based diversified financial services firm Bank of America, detracted from relative returns. At the end of the review period, the Fund did not have any exposure to Virgin Money Holdings. In contrast, investment in certain equity REITs contributed to relative returns. In the industry, lack of exposure to U.S.-based REIT Simon Property and the investment in Hong Kong-based Link REIT, contributed to relative returns. Among other industries, the Fund s investment in U.S.-based diversified financial companies JPMorgan Chase and Co and Morgan Stanley contributed to relative returns. Portfolio changes: During the review period, the portfolio manager increased the Fund s exposure to banking stocks owing to the favourable interest rate environment in certain regions. He added exposure to Australia-based bank ANZ Banking, and initiated investments in France-based banks BNP Paribas and Societe Generale, and to Russia-based retail bank Sberbank. In contrast, exposure to the real estate industry declined as he found investment opportunities elsewhere. Among real estate companies, the portfolio manager exited the Fund s position in certain stocks such as Germany-based property developer Deutsche Wohnen. 1

4 Fidelity Global Financial Services Fund Management Discussion of Fund Performance continued Benchmark change during the review period: As of September 1, 2016, the name of the Fund s specific benchmark changed from MSCI ACWI Financials Index to MSCI ACWI Financials and Real Estate Index Blend. The index change is the result of the index provider removing real estate securities from the Financials index and creating a new and separate Real Estate sector index. The index provider created a new custom index, combining real estate securities with other financial sector securities to replicate the methodology of the Funds historical benchmark composition. The benchmark methodology and constituents remain the same and there has been no change in the Fund s objectives or strategies. Recent Developments In the current environment, the portfolio manager looks for businesses whose earnings potential is underestimated by the market and those with improving fundamentals that are not yet reflected in the share price. This typically translates into companies with improving returns on equity/ returns on assets. The Fund invests in quality companies with a focus on franchise, management and asset quality. By focusing on the macroeconomic environment, the manager seeks to ensure that the Fund is exposed to businesses in countries with robust sovereign fundamentals, sound banking systems and a favourable regulatory environment. At the end of the review period, the Fund had its largest absolute allocation to the banking and insurance industries. The Fund diverged the most from its benchmark by having a higher allocation to the insurance industry, while having a lower allocation to the capital markets industry. Independent Review Committee Effective February 28, 2017, Helen M. Meyer retired from the Independent Review Committee and was replaced by James E. Cook as Chair. Also effective on that date, Frances Horodelski of Toronto, Ontario became a member of the Independent Review Committee. 2

5 Related Party Transactions Manager and Portfolio Adviser The Fund is managed by Fidelity Investments Canada ULC (Fidelity). Fidelity is part of a broader group 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 has entered into sub-advisory agreements with a number of entities including FIL Limited to provide investment advice with respect to all or a portion of the investments of the Fund. The sub-advisors arrange for 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 $792,000 for the period ended March 31, 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 $124,000 for the period ended March 31, Brokerage Commissions The Fund may place a portion of its portfolio transactions with brokerage firms which are affiliates of Fidelity Investments, including National Financial Services LLC, provided it determines that these affiliates trade execution abilities and costs are comparable to those of non affiliated, qualified brokerage firms, on an execution only basis. Commissions paid to brokerage firms that are affiliates of Fidelity Investments were $0 for the period ended March 31, Fidelity receives standing instructions from the IRC in respect of policies and procedures governing best execution of transactions with affiliates, which includes brokers affiliated to Fidelity Investments, at least once per year. 3

6 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 Global Financial Services Fund Series A Periods ended March 31, The Series Net Assets per Security A Net assets, beginning of period B $ $ $ $ $ Increase (decrease) from operations: Total revenue Total expenses (excluding distributions) (.75) (.71) (.62) (.56) (.37) Realized gains (losses) Unrealized gains (losses).93 (1.88) Total increase (decrease) from operations B 4.34 (.92) Distributions: From net investment income (excluding dividends) From dividends From capital gains Return of capital Total distributions B,C Net assets, end of period B $ $ $ $ $ Ratios and Supplemental Data Net asset value (000s) D $ 15,280 $ 14,779 $ 14,974 $ 13,282 $ 11,555 Securities outstanding D 550, , , , ,720 Management expense ratio E,F 2.58% 2.61% 2.66% 2.71% 2.67% Management expense ratio before waivers or absorptions E,F 2.62% 2.68% 2.70% 2.71% 2.67% Trading expense ratio G.20%.04%.12%.19%.23% Portfolio turnover rate H 79.95% 30.19% 54.44% 82.61% 98.98% Net asset value per security, end of period $ $ $ $ $ Fidelity Global Financial Services Fund Series B Periods ended March 31, The Series Net Assets per Security A Net assets, beginning of period B $ $ $ $ $ Increase (decrease) from operations: Total revenue Total expenses (excluding distributions) (.71) (.67) (.58) (.52) (.34) Realized gains (losses) Unrealized gains (losses).88 (2.03) Total increase (decrease) from operations B 4.38 (1.01) Distributions: From net investment income (excluding dividends) From dividends From capital gains Return of capital Total distributions B,C Net assets, end of period B $ $ $ $ $ Ratios and Supplemental Data Net asset value (000s) D $ 25,164 $ 22,588 $ 23,897 $ 21,887 $ 17,357 Securities outstanding D 890, , ,246 1,082,738 1,051,966 Management expense ratio E,F 2.38% 2.39% 2.44% 2.47% 2.44% Management expense ratio before waivers or absorptions E,F 2.41% 2.45% 2.46% 2.47% 2.44% Trading expense ratio G.20%.04%.12%.19%.23% Portfolio turnover rate H 79.95% 30.19% 54.44% 82.61% 98.98% Net asset value per security, end of period $ $ $ $ $

7 Fidelity Global Financial Services Fund Series F Periods ended March 31, The Series Net Assets per Security A Net assets, beginning of period B $ $ $ $ $ Increase (decrease) from operations: Total revenue Total expenses (excluding distributions) (.48) (.41) (.37) (.32) (.19) Realized gains (losses) Unrealized gains (losses) 1.00 (2.53) Total increase (decrease) from operations B 5.38 (1.16) Distributions: From net investment income (excluding dividends) (.15) From dividends (.09) (.03) From capital gains Return of capital Total distributions B,C (.24) (.03) Net assets, end of period B $ $ $ $ $ Ratios and Supplemental Data Net asset value (000s) D $ 5,664 $ 3,336 $ 2,532 $ 1,708 $ 1,439 Securities outstanding D 181, ,754 94,619 78,529 81,998 Management expense ratio E,F 1.24% 1.23% 1.27% 1.31% 1.29% Management expense ratio before waivers or absorptions E,F 1.26% 1.30% 1.31% 1.31% 1.29% Trading expense ratio G.20%.04%.12%.19%.23% Portfolio turnover rate H 79.95% 30.19% 54.44% 82.61% 98.98% Net asset value per security, end of period $ $ $ $ $ Fidelity Global Financial Services Fund Series O Periods ended March 31, The Series Net Assets per Security A Net assets, beginning of period B $ $ $ $ $ Increase (decrease) from operations: Total revenue Total expenses (excluding distributions) (.14) (.08) (.08) (.06) Realized gains (losses) Unrealized gains (losses).81 (3.34) Total increase (decrease) from operations B 5.94 (1.49) Distributions: From net investment income (excluding dividends) (.42) (.04) From dividends (.25) (.20) (.24) From capital gains Return of capital Total distributions B,C (.67) (.24) (.24) Net assets, end of period B $ $ $ $ $ Ratios and Supplemental Data Net asset value (000s) D $ 11,379 $ 6,745 $ 6,651 $ 5,639 $ 4,051 Securities outstanding D 334, , , , ,507 Management expense ratio % % % % % Management expense ratio before waivers or absorptions % % % % % Trading expense ratio G.20%.04%.12%.19%.23% Portfolio turnover rate H 79.95% 30.19% 54.44% 82.61% 98.98% Net asset value per security, end of period $ $ $ $ $

8 Financial Highlights continued Fidelity Global Financial Services Fund Series E1 Periods ended March 31, I The Series Net Assets per Security A Net assets, beginning of period B $ $ Increase (decrease) from operations: Total revenue Total expenses (excluding distributions) (.31) (.05) Realized gains (losses) Unrealized gains (losses) Total increase (decrease) from operations B Distributions: From net investment income (excluding dividends) From dividends From capital gains Return of capital Total distributions B,C Net assets, end of period B $ $ Ratios and Supplemental Data Net asset value (000s) D $ 3,377 $ 1,133 Securities outstanding D 278, ,171 Management expense ratio E,J 2.31% 2.32% Management expense ratio before waivers or absorptions E,J 2.34% 2.37% Trading expense ratio G.20%.04% Portfolio turnover rate H 79.95% 30.19% Net asset value per security, end of period $ $ Fidelity Global Financial Services Fund Series E2 Periods ended March 31, I The Series Net Assets per Security A Net assets, beginning of period B $ $ Increase (decrease) from operations: Total revenue Total expenses (excluding distributions) (.31) (.04) Realized gains (losses) Unrealized gains (losses) (.09).47 Total increase (decrease) from operations B Distributions: From net investment income (excluding dividends) From dividends From capital gains Return of capital Total distributions B,C Net assets, end of period B $ $ Ratios and Supplemental Data Net asset value (000s) D $ 191 $ 69 Securities outstanding D 15,790 6,754 Management expense ratio E,J 2.24% 2.24% Management expense ratio before waivers or absorptions E,J 2.27% 2.29% Trading expense ratio G.20%.04% Portfolio turnover rate H 79.95% 30.19% Net asset value per security, end of period $ $

9 Fidelity Global Financial Services Fund Series E3 Periods ended March 31, I The Series Net Assets per Security A Net assets, beginning of period B $ $ Increase (decrease) from operations: Total revenue Total expenses (excluding distributions) (.32) (.04) Realized gains (losses) 1.85 Unrealized gains (losses) (.03).16 Total increase (decrease) from operations B Distributions: From net investment income (excluding dividends) From dividends From capital gains Return of capital Total distributions B,C Net assets, end of period B $ $ Ratios and Supplemental Data Net asset value (000s) D $ 315 $ 1 Securities outstanding D 25, Management expense ratio E,J 2.18% 2.06% Management expense ratio before waivers or absorptions E,J 2.21% 2.47% Trading expense ratio G.20%.04% Portfolio turnover rate H 79.95% 30.19% Net asset value per security, end of period $ $ Fidelity Global Financial Services Fund Series E4 Periods ended March 31, 2017 K The Series Net Assets per Security A Net assets, beginning of period B $ Increase (decrease) from operations: Total revenue.07 Total expenses (excluding distributions) (.06) Realized gains (losses).34 Unrealized gains (losses) (.02) Total increase (decrease) from operations B.33 Distributions: From net investment income (excluding dividends) From dividends From capital gains Return of capital Total distributions B,C Net assets, end of period B $ Ratios and Supplemental Data Net asset value (000s) D $ 191 Securities outstanding D 18,477 Management expense ratio E,L 2.13% Management expense ratio before waivers or absorptions E,L 2.15% Trading expense ratio G.20% Portfolio turnover rate H 79.95% Net asset value per security, end of period $

10 Financial Highlights continued Fidelity Global Financial Services Fund Series P1 Periods ended March 31, M The Series Net Assets per Security A Net assets, beginning of period B $ 9.04 $ Increase (decrease) from operations: Total revenue Total expenses (excluding distributions) (.17) (.05) Realized gains (losses) Unrealized gains (losses).21 (.94) Total increase (decrease) from operations B 2.11 (.78) Distributions: From net investment income (excluding dividends) (.06) From dividends (.03) From capital gains Return of capital Total distributions B,C (.09) Net assets, end of period B $ $ 9.04 Ratios and Supplemental Data Net asset value (000s) D $ 1,125 $ 58 Securities outstanding D 104,090 6,424 Management expense ratio E,N 1.12% 1.13% Management expense ratio before waivers or absorptions E,N 1.13% 1.18% Trading expense ratio G.20%.04% Portfolio turnover rate H 79.95% 30.19% Net asset value per security, end of period $ $ Fidelity Global Financial Services Fund Series P2 Periods ended March 31, M The Series Net Assets per Security A Net assets, beginning of period B $ 9.05 $ Increase (decrease) from operations: Total revenue Total expenses (excluding distributions) (.12) (.03) Realized gains (losses) Unrealized gains (losses).35 (1.13) Total increase (decrease) from operations B 1.89 (.95) Distributions: From net investment income (excluding dividends) (.08) From dividends (.04) From capital gains Return of capital Total distributions B,C (.12) Net assets, end of period B $ $ 9.05 Ratios and Supplemental Data Net asset value (000s) D $ 1 $ 1 Securities outstanding D Management expense ratio E,N.84%.89% Management expense ratio before waivers or absorptions E,N.89% 1.02% Trading expense ratio G.20%.04% Portfolio turnover rate H 79.95% 30.19% Net asset value per security, end of period $ $

11 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, 2013 follow International Financial Reporting Standards (IFRS) and periods prior to January 1, 2013 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, 2017 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, prior period figures in the tables above may not foot due to this rounding change. B C D E F G H 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. 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. Distributions are presented based on management s best estimate of the tax character. This information is provided as at period end of the year shown. 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. Effective November 1, 2014, 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. 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. The Fund s portfolio turnover rate indicates how actively the Fund s portfolio adviser manages its portfolio investments. A portfolio turnover rate of 100% 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, 2016 (commencement of sale of securities) to March 31, J Effective February 9, 2016, 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 January 6, 2017 (commencement of sale of securities) to March 31, L Effective January 10, 2017, 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, 2015 (commencement of sale of securities) to March 31, N Effective December 8, 2015, 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. 9

12 Management and Advisory Fees Fidelity serves as manager and investment advisor of the Fund. 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. 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 the 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 100% 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 2.000% 31.14% 68.86% Series B 1.850% 54.05% 45.95% Series F 0.850% % Series E % 54.79% 45.21% Series E % 55.56% 44.44% Series E % 56.34% 43.66% Series E % 57.97% 42.03% Series P % % Series P % % 10

13 Fidelity Global Financial Services Fund 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. 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 O Fiscal Years Fiscal Years (%) (%) Series B Series E1 Fiscal Years Fiscal Years (%) (%) Series F Commencement of Operations is February 5, 2016 Fiscal Years Series E2 (%) Fiscal Years (%) Commencement of Operations is February 5,

14 Fidelity Global Financial Services Fund Past Performance continued Series E3 Series P1 Fiscal Years Fiscal Years (%) (%) Commencement of Operations is February 5, 2016 Commencement of Operations is December 4, 2015 Series E4 Series P2 Fiscal Years 2017 Fiscal Years (%) (%) Commencement of Operations is January 6, 2017 Commencement of Operations is December 4, 2015 Annual Compound Returns This table shows the Fund historical annual compound total returns for the periods indicated, compared with a broad-broad index, the MSCI World Index and the Fund s benchmark, as described below. 12 Past 1 year Past 3 years Past 5 years Past 10 years Since Inception Average Annual Total Returns Fidelity Global Financial Services Fund Series A 18.8% 11.5% 15.6% 1.8% n/a Fidelity Global Financial Services Fund Series B 19.1% 11.8% 15.8% 2.0% n/a Fidelity Global Financial Services Fund Series F 20.4% 13.1% 17.2% 3.1% n/a Fidelity Global Financial Services Fund Series O 21.9% 14.5% 18.6% 4.5% n/a Fidelity Global Financial Services Fund Series E1 19.2% n/a n/a n/a 18.1% Fidelity Global Financial Services Fund Series E2 19.2% n/a n/a n/a 18.1% Fidelity Global Financial Services Fund Series E3 19.5% n/a n/a n/a 18.4% Fidelity Global Financial Services Fund Series P1 20.6% n/a n/a n/a 6.8% Fidelity Global Financial Services Fund Series P2 20.9% n/a n/a n/a 7.0% MSCI ACWI (All Country World Index) Financials and Real Estate Index Blend 25.6% 11.1% 15.5% 0.9% 9.6% MSCI World Index 18.3% 12.4% 15.9% 5.7% 9.1% The period used for the since inception MSCI ACWI (All Country World Index) Financials and Real Estate Index Blend and MSCI World Index returns are based on Series P1 which has been in existence the longest compared to all Series with less than 10 years of operations. A discussion of the performance of the Fund can be found in the Results of Operation section of this report. The Fund s blended benchmark is a combination of MSCI ACWI (All Country World Index) Financials Index and the MSCI ACWI (All Country World Index) Real Estate Index. Prior to September 1, 2016, the Fund s benchmark was the MSCI ACWI (All Country World Index) Financials Index. Subsequently the real estate component of the index was separated out into a distinct MSCI ACWI (All Country World Index) Real Estate

15 Index. The index change is the result of the index provider removing real estate securities from the Financials index and creating a new and separate Real Estate sector index. The benchmark methodology and constituents remain the same and there has been no change in the Funds objectives or strategies. The MSCI ACWI (All Country World Index) Financials Index captures large and mid-cap representation across 23 Developed Markets (DM) and 23 Emerging Markets (EM) countries. All securities in the index are classified in the Financials as per the Global Industry Classification Standard (GICS ). The MSCI ACWI (All Country World Index) Real Estate Index is designed to capture the large and mid-cap segments across 23 Developed Markets (DM) and 23 Emerging Markets (EM) countries. All securities in the index are classified in the Real Estate according to the Global Industry Classification Standard (GICS ). 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 due to differences in management fees and expenses. 13

16 Fidelity Global Financial Services Fund Summary of Investment Portfolio as at March 31, 2017 Sector Mix as of March 31, 2017 % of Fund s Net Assets Banks 46.6 Insurance 23.6 Equity Real Estate Investment Trusts (Reits) 8.5 Capital Markets 7.4 Real Estate Management & Development 4.3 Diversified Financial Services 3.5 Consumer Finance 3.0 Others (Individually Less Than 1%) 0.9 Cash and Cash Equivalents 2.5 Net Other Assets (Liabilities) (0.3) Geographic Mix as of March 31, 2017 % of Fund s Net Assets United States of America 39.3 Japan 6.6 Hong Kong 6.5 United Kingdom 5.3 Canada 4.5 Australia 4.0 China 3.9 France 3.6 Germany 3.0 Spain 2.5 Switzerland 2.3 Italy 2.2 Korea (South) 1.8 Bermuda 1.8 Brazil 1.7 India 1.7 Russia 1.6 Thailand 1.5 Netherlands 1.2 Others (Individually Less Than 1%) 2.8 Cash and Cash Equivalents 2.5 Net Other Assets (Liabilities) (0.3) Top 25 Issuers % of Fund s Net Assets 1. JPMorgan Chase & Co Wells Fargo & Co Citigroup, Inc Cash and Cash Equivalents Australia & New Zealand Banking Group Ltd AIA Group Ltd Berkshire Hathaway, Inc Mitsubishi UFJ Financial Group, Inc Bank of America Corp Discover Financial Services MetLife, Inc BNP Paribas SA Sberbank of Russia Morgan Stanley Royal Bank of Canada Allianz SE Goldman Sachs Group, Inc Canadian Imperial Bank of Commerce Societe Generale CaixaBank SA Bank of Nova Scotia General Growth Properties, Inc China Pacific Insurance (Group) Co. Ltd Prologis, Inc HSBC Holdings PLC 1.3 Total Fund Net Assets $62,659, 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 300, Toronto ON M5G 2N7 or by visiting our web site at or SEDAR at 14

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20 Fidelity Investments Canada ULC 483 Bay Street, Suite 300 Toronto, Ontario M5G 2N7 Manager, Transfer Agent and Registrar Fidelity Investments Canada ULC 483 Bay Street, Suite 300 Toronto, Ontario M5G 2N7 Custodian State Street Trust Company of Canada Toronto, Ontario Portfolio Adviser Fidelity Investments Canada ULC 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 or Fidelity U.S. Money Market Fund 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 FMR LLC E FICL-FFS-MRFPA-0617