Fidelity American Balanced Currency Neutral Fund

Transcription

1 Fidelity American Balanced Currency Neutral Fund Semi-Annual Management Report of Fund Performance September 3,

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 Semi-Annual Management Report of Fund Performance as at September 3, Fidelity American Balanced Currency Neutral Fund This semi-annual management report of fund performance contains financial highlights but does not contain the complete semi-annual financial statements for the investment fund. You can get a copy of the semi-annual financial statements at your request, and at no cost, by calling , by writing to us at Fidelity Investments, 483 Bay St. Suite 3, Toronto ON MG 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 Results of Operations Fidelity American Balanced Currency Neutral Fund (Fund), Series B, returned.%, after fees and expenses, for the six-month period ended September 3,. The net returns of the other series of this Fund are similar to those of Series B, except for differences attributable to expense structures. U.S. equity markets, as represented by the S&P Index Hedged CAD, returned 7.3% in Canadian dollar terms for the same period. U.S. investment grade bonds, as represented by the Bloomberg Barclays U.S. Aggregate Bond Index Hedged CAD, returned 2.% in Canadian dollar terms for the same period. Fidelity American Balanced Currency Neutral Fund aims to achieve long-term capital growth. It invests substantially all of its assets in securities of Fidelity American Balanced Fund (Underlying Fund). Market Overview: U.S. equity markets lagged other global equity markets as the impact of positive economic data was offset by concerns regarding geopolitical tensions in the Korean peninsula, the economic implications of hurricanes Harvey and Irma, and the Canadian dollar s appreciation relative to the U.S. dollar. However, investor sentiment remained strong on the back of largely positive domestic data and the new U.S. administration s tax reform proposals. U.S. investment grade bonds registered negative returns in Canadian dollar terms due to the Canadian dollar s appreciation during the review period. Positive returns in global investment-grade bonds were dampened slightly when yields rose after the U.S. Federal Reserve (Fed) increased interest rates in June from 1.% to 1.2% the second rate increase in. Yields began to edge even higher toward end of the review period, partially due to the new U.S. administration s tax reform plan, which raised both optimism for future growth and concerns about an increase in the Federal deficit. The Fed indicated there may be one more interest rate increase during the year, followed by three potential increases in 218 contingent on upcoming economic data. The Fed also announced that it would start winding down its balance sheet from October, but said that the normalization process would be gradual and predictable. Factors affecting performance: On a total return basis, the Fund s exposure to global small/mid-cap equities through Fidelity Global Intrinsic Value Investment Trust contributed to total returns, while exposure to fixed-income securities through Fidelity U.S. Bond Investment Trust detracted from total returns. Within Fidelity Global Intrinsic Value Investment Trust, exposure to holdings in the consumer discretionary and health care sectors contributed to total returns. In the consumer discretionary sector, U.K. residential property developer Bellway, and U.S. hospitality company Wyndham Worldwide, contributed to total returns. In health care, pharmaceutical companies Abbvie and Novo-Nordisk contributed to total returns. Among fixed-income holdings, Fidelity U.S. Bond Investment Trust posted a negative total return in Canadian dollar terms due to the appreciation of the Canadian dollar versus U.S. dollar over the period. However, the return was positive when measured in U.S. dollars. Exposure to U.S. equities also contributed to total returns, with exposure to both Fidelity Insights Investment Trust and Fidelity American Equity Fund both making positive contributions to total returns. Portfolio Changes: In terms of asset allocation, the most notable position change during the review period was the addition of Fidelity Insights Investment Trust, which is a growth oriented, large market capitalization, U.S. equity mandate managed by veteran portfolio manager Will Danoff. To accommodate this new position, exposure was trimmed from Fidelity American Equity Fund and Fidelity Global Intrinsic Value Investment Trust. In the Fund s exposure to global equities through Fidelity Global Intrinsic Value Investment Trust, exposure was increased to the consumer discretionary and financials sectors. Within the consumer discretionary sector, the Fund initiated a position in U.S.-based kitchenware and home furnishing retailer Williams-Sonoma, the portfolio managers favouring its strong fundamentals and its successful e-commerce strategy. Within the financials sector, the Fund initiated a position in U.S.-based financial services company JPMorgan Chase. The portfolio managers believe the company is very well managed and attractively valued, with a decent dividend yield. Exposure was increased to select holdings in the insurance and banking industries, particularly to firms that the portfolio managers believe have had more robust balance sheets and attractive valuations based on their book values. Though the portfolio managers have generally been cautious on the financials sector, they sought to modestly increase their exposure to avoid a significantly lower-than-benchmark exposure in order to manage risk. Exposure to the 1

4 Fidelity American Balanced Currency Neutral Fund Management Discussion of Fund Performance continued real estate sector was also increased by adding to the position in Japan-based construction company Leopalace 21 Corporation, owing to its strong growth prospects, in the portfolio manager s view. In contrast, exposure was reduced to the consumer staples sector. Exposure was reduced to food, beverage and tobacco companies such as Denmark-based cigar and traditional pipe tobacco manufacturer Scandinavian Tobacco Group, as the portfolio managers opted to realize profits after the share price rebounded significantly. The position in Switzerlandbased convenience foods producer Orior was also reduced as the portfolio manager believe that the fundamentals appeared less attractive than before and the risk-reward profile became less favourable. Within the Fund s exposure to U.S. equities through Fidelity American Equity Fund, allocation to the financials sector was increased, while exposure to the health care sector was reduced. In the financials sector, positions were initiated in investment management company BlackRock, and in electronic brokerage firm Interactive Brokers, owing to their attractive valuations, in the portfolio manager s view. In the health care sector, the Fund reduced its exposure to health care services company Cardinal Health, as the portfolio manager found better investment opportunities elsewhere. Within the Fund s exposure to U.S. equities through Fidelity Insights Investment Trust, allocation to the health care sector was increased, while exposure to the financials sector declined. In the health care sector, the Fund initiated a position in Vertex Pharmaceuticals, owing to their unique offering of cystic fibrosis drugs. In the financials sector, the Fund reduced its exposure to Goldman Sachs and Morgan Stanley, as the portfolio manager found better opportunities elsewhere. Within the Fund s bond exposure through Fidelity U.S. Bond Investment Trust, allocations to corporate and treasury bonds were increased, as the portfolio managers believe their yields appeared attractive. Among corporate bonds, financial institution issuers were increased. Derivative Disclosure: During the period, the Fund engaged in forward contracts, in a manner consistent with its investment objective and strategies, to hedge as completely as possible against the effect of currency fluctuations on the Fund s investment returns. The use of forward contracts in this manner does not completely eliminate the impact of currency fluctuations on returns. The Fund s returns will differ from the local currency returns of the Fund s underlying investments. Recent Developments Asset allocation portfolio managers Geoff Stein and David Wolf seek to maintain a strategic allocation of equities and fixed-income securities. They believe the economic cycle is approaching its later stages as central banks are beginning to raise interest rates and inflation risks are growing. Fidelity American Equity Fund portfolio manager Steve MacMillan believes that U.S. stocks should continue to perform well over the long term. He believes an investment in U.S. equities is not a short-term trade but rather a long-term strategic allocation with a place in any diversified portfolio. Regardless of the economic climate, he remains committed to seeking businesses that are less sensitive to cyclical risks, have strong earnings visibility and can grow revenues. Fidelity Global Intrinsic Value Investment Trust portfolio managers Joel Tillinghast and Salim Hart aim to build a portfolio with a mix of holdings across the market spectrum. They have recently been finding more opportunities among smaller-cap companies, where valuations appear more attractive in their view. They employ an intrinsic value investment framework, using bottom-up fundamental analysis and quantitative techniques to identify high-quality companies that could compound returns over time. The portfolio managers seek to mitigate downside risk by emphasizing companies with attractive stock valuations. Regionally, they are currently finding more investment opportunities in emerging Asia. Fidelity Insights Investment Trust portfolio manager Will Danoff has found attractive investment opportunities in the information technology sector, believing that many top companies have the potential for significant growth. He emphasizes what he considers to be franchise companies in technology those with dominant positions, particularly in the online mobile advertising space. He believes they can continue to grow their revenues as consumers search the web more often from their smartphones. Globally, he currently prefers U.S.-centric companies, believing the U.S. economy should remain strong. Despite U.S. market valuations being elevated, he believes the outlook for the companies he owns is positive, and that they have the opportunity to grow meaningfully over the next two or three years. Fidelity U.S. Bond Investment Trust portfolio manager Jeff Moore believes that given the prevailing market conditions, investment grade corporate bonds offer more attractive total return potential than treasuries and government bonds. He remains focused on the Fed s monetary policy direction and whether it can be affected by developments in the U.S. administration s proposed fiscal policies. As at September 3,, in terms of asset allocation, the largest amount of the Fund s assets was invested in foreign equities. On a geographic basis, the Fund s largest exposure was to the U.S., followed by Japan and United Kingdom. 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 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 $141, for the period ended September 3,. 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 $23, for the period ended September 3,. 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 American Balanced Currency Neutral Fund Series A September 3, A Net assets, beginning of period C $.76 $. Total expenses (excluding distributions) (.14) (.2) Realized gains (losses).6.42 Unrealized gains (losses).16.2 Total increase (decrease) from operations C.8.47 Return of capital Total distributions C,D Net assets, end of period C $ $.76 Net asset value (s) E $ 3,14 $ 2,4 Securities outstanding E 26,773 19,943 Management expense ratio F,G 2.3% 2.4% Management expense ratio before waivers or absorptions F,G 2.% 2.% Trading expense ratio H.%.3% Net asset value per security, end of period $ $.783 Fidelity American Balanced Currency Neutral Fund Series B September 3, A Net assets, beginning of period C $.76 $. Total expenses (excluding distributions) (.13) (.17) Realized gains (losses).8.2 Unrealized gains (losses).1.6 Total increase (decrease) from operations C.6.41 Return of capital Total distributions C,D Net assets, end of period C $ 11.3 $.76 Net asset value (s) E $,67 $ 3,6 Securities outstanding E 1,64 291,388 Management expense ratio F,G 2.33% 2.32% Management expense ratio before waivers or absorptions F,G 2.34% 2.34% Trading expense ratio H.%.3% Net asset value per security, end of period $ $

7 Fidelity American Balanced Currency Neutral Fund Series F September 3, A Net assets, beginning of period C $.8 $. Total expenses (excluding distributions) (.6) (.9) Realized gains (losses).9.3 Unrealized gains (losses) Total increase (decrease) from operations C.67.7 Return of capital Total distributions C,D Net assets, end of period C $ 11.1 $.8 Net asset value (s) E $ 6,267 $ 3,396 Securities outstanding E, ,61 Management expense ratio F,G 1.19% 1.17% Management expense ratio before waivers or absorptions F,G 1.19% 1.19% Trading expense ratio H.%.3% Net asset value per security, end of period $ 11.1 $.838 Fidelity American Balanced Currency Neutral Fund Series F September 3, A Net assets, beginning of period C $ 2.94 $ 2. Total expenses (excluding distributions) (.12) (.17) Realized gains (losses) Unrealized gains (losses) Total increase (decrease) from operations C Return of capital (.) (.7) Total distributions C,D (.) (.7) Net assets, end of period C $ 21.7 $ 2.94 Net asset value (s) E $ 1,18 $ 194 Securities outstanding E 46,936 9,31 Management expense ratio F,G 1.18% 1.1% Management expense ratio before waivers or absorptions F,G 1.18% 1.18% Trading expense ratio H.%.3% Net asset value per security, end of period $ $

8 Financial Highlights continued Fidelity American Balanced Currency Neutral Fund Series F8 September 3, A Net assets, beginning of period C $ 2.48 $ 2. Total expenses (excluding distributions) (.13) (.17) Realized gains (losses) 1. (.78) Unrealized gains (losses) Total increase (decrease) from operations C Return of capital (.8) (1.2) Total distributions C,D (.8) (1.2) Net assets, end of period C $ 2.9 $ 2.48 Net asset value (s) E $ 8 $ 8 Securities outstanding E Management expense ratio F,G 1.22% 1.19% Management expense ratio before waivers or absorptions F,G 1.22% 1.22% Trading expense ratio H.%.3% Net asset value per security, end of period $ 2.99 $ Fidelity American Balanced Currency Neutral Fund Series T September 3, A Net assets, beginning of period C $ 2.73 $ 2. Total expenses (excluding distributions) (.27) (.4) Realized gains (losses).89.2 Unrealized gains (losses).7.4 Total increase (decrease) from operations C Return of capital (.) (.7) Total distributions C,D (.) (.7) Net assets, end of period C $ $ 2.73 Net asset value (s) E $ 127 $ 6 Securities outstanding E,98 3,136 Management expense ratio F,G 2.7% 2.6% Management expense ratio before waivers or absorptions F,G 2.8% 2.8% Trading expense ratio H.%.3% Net asset value per security, end of period $ $

9 Fidelity American Balanced Currency Neutral Fund Series T8 September 3, A Net assets, beginning of period C $ 2.28 $ 2. Total expenses (excluding distributions) (.2) (.38) Realized gains (losses) Unrealized gains (losses).19. Total increase (decrease) from operations C Return of capital (.8) (1.2) Total distributions C,D (.8) (1.2) Net assets, end of period C $ 2.7 $ 2.28 Net asset value (s) E $ 481 $ 37 Securities outstanding E 23,426 1,182 Management expense ratio F,G 2.47% 2.46% Management expense ratio before waivers or absorptions F,G 2.48% 2.48% Trading expense ratio H.%.3% Net asset value per security, end of period $ $ Fidelity American Balanced Currency Neutral Fund Series S September 3, A Net assets, beginning of period C $ 2.7 $ 2. Total expenses (excluding distributions) (.23) (.3) Realized gains (losses) Unrealized gains (losses) Total increase (decrease) from operations C Return of capital (.) (.7) Total distributions C,D (.) (.7) Net assets, end of period C $ $ 2.7 Net asset value (s) E $ 1,113 $ 74 Securities outstanding E 2,87 3,66 Management expense ratio F,G 2.36% 2.34% Management expense ratio before waivers or absorptions F,G 2.36% 2.36% Trading expense ratio H.%.3% Net asset value per security, end of period $ $

10 Financial Highlights continued Fidelity American Balanced Currency Neutral Fund Series S8 September 3, A Net assets, beginning of period C $ 2.3 $ 2. Total expenses (excluding distributions) (.24) (.36) Realized gains (losses) Unrealized gains (losses) Total increase (decrease) from operations C Return of capital (.8) (1.2) Total distributions C,D (.8) (1.2) Net assets, end of period C $ 2.6 $ 2.3 Net asset value (s) E $ 448 $ 312 Securities outstanding E 22,724 1,389 Management expense ratio F,G 2.34% 2.32% Management expense ratio before waivers or absorptions F,G 2.34% 2.34% Trading expense ratio H.%.3% Net asset value per security, end of period $ 2.67 $ Fidelity American Balanced Currency Neutral Fund Series E1 September 3, A Net assets, beginning of period C $.78 $. Total expenses (excluding distributions) (.13) (.18) Realized gains (losses) Unrealized gains (losses) Total increase (decrease) from operations C.62.3 Return of capital Total distributions C,D Net assets, end of period C $ $.78 Net asset value (s) E $ 1,82 $ 1,11 Securities outstanding E 18,432 3,44 Management expense ratio F,G 2.2% 2.23% Management expense ratio before waivers or absorptions F,G 2.26% 2.24% Trading expense ratio H.%.3% Net asset value per security, end of period $ $.778 8

11 Fidelity American Balanced Currency Neutral Fund Series E1T September 3, J Net assets, beginning of period C $ 2. $ 2. Total expenses (excluding distributions) (.23) (.) Realized gains (losses) Unrealized gains (losses).1 (.11) Total increase (decrease) from operations C Return of capital (.) (.2) Total distributions C,D (.) (.2) Net assets, end of period C $ 2.64 $ 2. Net asset value (s) E $ 643 $ 462 Securities outstanding E 31,162 23,36 Management expense ratio F,K 2.27% 2.27% Management expense ratio before waivers or absorptions F,K 2.27% 2.27% Trading expense ratio H.%.3% Net asset value per security, end of period $ $ Fidelity American Balanced Currency Neutral Fund Series E2 September 3, J Net assets, beginning of period C $.1 $. Total expenses (excluding distributions) (.11) (.) Realized gains (losses) Unrealized gains (losses).7 (.12) Total increase (decrease) from operations C.8.1 Return of capital Total distributions C,D Net assets, end of period C $.72 $.1 Net asset value (s) E $ 4 $ 16 Securities outstanding E 1,73 1,38 Management expense ratio F,K 2.12% 2.1% Management expense ratio before waivers or absorptions F,K 2.12% 2.1% Trading expense ratio H.%.3% Net asset value per security, end of period $.717 $

12 Financial Highlights continued Fidelity American Balanced Currency Neutral Fund Series E2T September 3, J Net assets, beginning of period C $ 2. $ 2. Total expenses (excluding distributions) (.22) (.) Realized gains (losses) (1.62).4 Unrealized gains (losses) 3.33 (.) Total increase (decrease) from operations C Return of capital (.) (.2) Total distributions C,D (.) (.2) Net assets, end of period C $ 2.67 $ 2. Net asset value (s) E $ 1 $ 187 Securities outstanding E 2 9,331 Management expense ratio F,K 2.18% 2.19% Management expense ratio before waivers or absorptions F,K 2.18% 2.19% Trading expense ratio H.%.3% Net asset value per security, end of period $ $ 2.26 Fidelity American Balanced Currency Neutral Fund Series E3 September 3, J Net assets, beginning of period C $.16 $. Total expenses (excluding distributions) (.11) (.4) Realized gains (losses) Unrealized gains (losses) (.1).2 Total increase (decrease) from operations C..3 Return of capital Total distributions C,D Net assets, end of period C $.73 $.16 Net asset value (s) E $ 381 $ 1 Securities outstanding E 3,47 Management expense ratio F,K 2.3% 2.12% Management expense ratio before waivers or absorptions F,K 2.3% 2.13% Trading expense ratio H.%.3% Net asset value per security, end of period $.7319 $.182

13 Fidelity American Balanced Currency Neutral Fund Series P1 September 3, A Net assets, beginning of period C $.87 $. Total expenses (excluding distributions) (.6) (.9) Realized gains (losses).6. Unrealized gains (losses).12. Total increase (decrease) from operations C Return of capital Total distributions C,D Net assets, end of period C $ 11.4 $.87 Net asset value (s) E $ 2,47 $ 1,387 Securities outstanding E 213, ,6 Management expense ratio F,G 1.7% 1.7% Management expense ratio before waivers or absorptions F,G 1.7% 1.7% Trading expense ratio H.%.3% Net asset value per security, end of period $ $.87 Fidelity American Balanced Currency Neutral Fund Series P1T September 3, J Net assets, beginning of period C $ 2. $ 2. Total expenses (excluding distributions) (.11) (.) Realized gains (losses) Unrealized gains (losses).17 (.) Total increase (decrease) from operations C Return of capital (.) (.2) Total distributions C,D (.) (.2) Net assets, end of period C $ 2.83 $ 2. Net asset value (s) E $ 364 $ 181 Securities outstanding E 17,493 9,14 Management expense ratio F,K 1.% 1.8% Management expense ratio before waivers or absorptions F,K 1.6% 1.8% Trading expense ratio H.%.3% Net asset value per security, end of period $ $

14 Financial Highlights continued Fidelity American Balanced Currency Neutral Fund Series P2 September 3, J Net assets, beginning of period C $.18 $. Total expenses (excluding distributions) (.) (.2) Realized gains (losses) Unrealized gains (losses).44 (.2) Total increase (decrease) from operations C Return of capital Total distributions C,D Net assets, end of period C $.81 $.18 Net asset value (s) E $ 1,283 $ 963 Securities outstanding E 118,743 94,67 Management expense ratio F,K.99% 1.% Management expense ratio before waivers or absorptions F,K.99% 1.% Trading expense ratio H.%.3% Net asset value per security, end of period $.888 $.1786 Fidelity American Balanced Currency Neutral Fund Series P2T September 3, J Net assets, beginning of period C $ 2. $ 2. Total expenses (excluding distributions) (.11) (.) Realized gains (losses) Unrealized gains (losses). (.4) Total increase (decrease) from operations C Return of capital (.) (.2) Total distributions C,D (.) (.2) Net assets, end of period C $ 2.83 $ 2. Net asset value (s) E $ 1,49 $ 7 Securities outstanding E 67,624 37,29 Management expense ratio F,K 1.3% 1.3% Management expense ratio before waivers or absorptions F,K 1.3% 1.3% Trading expense ratio H.%.3% Net asset value per security, end of period $ $

15 Fidelity American Balanced Currency Neutral Fund Series P3 September 3, J Net assets, beginning of period C $.18 $. Total expenses (excluding distributions) (.) (.2) Realized gains (losses)..23 Unrealized gains (losses).14 (.3) Total increase (decrease) from operations C Return of capital Total distributions C,D Net assets, end of period C $.81 $.18 Net asset value (s) E $ 2,38 $ 1,622 Securities outstanding E 213,441 19,34 Management expense ratio F,K.96%.97% Management expense ratio before waivers or absorptions F,K.97%.97% Trading expense ratio H.%.3% Net asset value per security, end of period $.811 $.1792 Fidelity American Balanced Currency Neutral Fund Series P3T September 3, J Net assets, beginning of period C $ 2.11 $ 2. Total expenses (excluding distributions) (.) (.4) Realized gains (losses).98.4 Unrealized gains (losses).36 (.) Total increase (decrease) from operations C Return of capital (.) (.2) Total distributions C,D (.) (.2) Net assets, end of period C $ 2.84 $ 2.11 Net asset value (s) E $ 311 $ 3 Securities outstanding E 14,9 14,99 Management expense ratio F,K.9%.97% Management expense ratio before waivers or absorptions F,K.9%.97% Trading expense ratio H.%.3% Net asset value per security, end of period $ $

16 Financial Highlights continued Financial Highlights Footnotes A For the period April 22, 216 (inception date) to. B C D E F G H I This information is derived from the Fund s audited annual and/or unaudited interim financial statements. 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. 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 June 3, 216, 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 % 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. J For the period January 6, (commencement of sale of securities) to. K Effective January,, 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 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 % 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.% 1.13% 48.87% Series B 1.8% 4.% 4.9% Series F.8%.% Series F.8%.% Series F8.8%.% Series T 2.% 36.79% 63.21% Series T8 2.% 24.99% 7.1% Series S 1.8% 4.% 4.9% Series S8 1.8% 4.% 4.9% Series E1 1.82% 4.79% 4.21% Series E1T 1.82% 4.79% 4.21% Series E2 1.8%.6% 44.44% Series E2T 1.8%.6% 44.44% Series E3 1.77% 6.34% 43.66% Series P1.82%.% Series P1T.82%.% Series P2.8%.% Series P2T.8%.% Series P3.77%.% Series P3T.77%.% 1

18 Fidelity American Balanced Currency Neutral 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. For each Series in the Year-by-Year Returns table below, the most recent returns stated are for the current six month period. Series A Series F Commencement of Operations is June 28, 216 Commencement of Operations is June 28, 216 Series B Series F Commencement of Operations is June 28, 216 Commencement of Operations is June 28, 216 Series F Series T Commencement of Operations is June 28, 216 Commencement of Operations is June 28,

19 Series T8 Series E1T Commencement of Operations is June 28, 216 Commencement of Operations is January 6, Series S Series E Commencement of Operations is June 28, 216 Commencement of Operations is January 6, Series S8 Series E2T Commencement of Operations is June 28, 216 Commencement of Operations is January 6, Series E1 Series E Commencement of Operations is June 28, 216 Commencement of Operations is January 6, 17

20 Fidelity American Balanced Currency Neutral Fund Past Performance continued Series P1 Series P Commencement of Operations is June 28, 216 Commencement of Operations is January 6, Series P1T Series P3T Commencement of Operations is January 6, Commencement of Operations is January 6, Series P Commencement of Operations is January 6, Series P2T Commencement of Operations is January 6, 18

21 Fidelity American Balanced Currency Neutral Fund Summary of Investment Portfolio as at September 3, Asset Mix Maturity Diversification % of Fund s Net Assets as at 9/3/17 % of Fund s Net Assets as at 3/31/17 Foreign Equities Foreign Bonds Canadian Equities 1..9 Canadian Bonds.4. Foreign Preferred Securities.1.1 Cash and Cash Equivalents.7. Net Other Assets (Liabilities) (.1) 6. Geographic Mix % of Fund s Net Assets as at 9/3/17 % of Fund s Net Assets as at 3/31/17 United States of America Japan United Kingdom Canada Cayman Islands 1..6 Germany 1..3 Others (Individually Less Than 1%) Cash and Cash Equivalents.7. Net Other Assets (Liabilities) (.1) 6. Derivative Exposure % of Fund s Net Assets as at 9/3/17 % of Fund s Net Assets as at 3/31/17 Forward Foreign Currency Contracts.4 (.) Forward Foreign Currency Contracts percentage is calculated by dividing the net unrealized gain/loss of all contracts held by total net assets. Years % of Fund s Net Assets as at 9/3/17 % of Fund s Net Assets as at 3/31/ Over Quality Diversification % of Fund s Net Assets as at 9/3/17 % of Fund s Net Assets as at 3/31/17 AAA.4. AA..1 A BBB BB and Below Not Rated.6.6 Equities Short-Term Investments and Net Other Assets We have used ratings from Moody s Investors Service, Inc. Where Moody s ratings are not available, we have used S&P ratings. All ratings are as of the date indicated and do not reflect subsequent changes. Top Issuers % of Fund s Net Assets 1. Fidelity Global Intrinsic Value Investment Trust Series O Fidelity U.S. Bond Investment Trust Series O Fidelity Insights Investment Trust Series O Fidelity American Equity Fund Series O Cash and Cash Equivalents. 6. Fidelity American High Yield Fund Series O Fidelity Floating Rate High Income Investment Trust Series O Fidelity High Income Commercial Real Estate Investment Trust Series O Total Fund Net Assets $29,84, Where applicable, the information in the above tables includes the Fund s pro-rata share of the investment in any Fidelity Underlying Fund. The Fund uses derivatives to try to minimize the exposure to currency fluctuations between foreign currencies in developed markets and the Canadian dollar. 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

22 Summary of Investment Portfolio as at September 3, continued available at no cost, by calling , by writing to us at Fidelity Investments Canada ULC, 483 Bay St. Suite 3, Toronto ON MG 2N7 or by visiting our web site at or SEDAR at 2

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24 Fidelity Investments Canada ULC 483 Bay Street, Suite 3 Toronto, Ontario MG 2N7 Manager, Transfer Agent and Registrar Fidelity Investments Canada ULC 483 Bay Street, Suite 3 Toronto, Ontario MG 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 Fidelity Investments Canada ULC E FICL-HGEB-MRFPS-1117