Fidelity Canadian Balanced Fund

Transcription

1 Fidelity Canadian Balanced Fund Semi-Annual Management Report of Fund Performance

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 Fidelity Canadian Balanced 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 M5G 2N7 or by visiting our website at or SEDAR at Security holders 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 Canadian Balanced Fund (Fund) Series B returned 2.6% after fees and expenses for the six-month period ended. The net returns of the other series of the Fund are similar to those of Series B, except for differences attributable to expense structures. Canadian equities, as represented by the S&P/TSX Composite Index, returned 1.2% for the review period while Canadian investment-grade bonds, as represented by the FTSE TMX Canada Universe Bond Index, returned -2.3% for the review period. Market Overview: Canadian equities rallied largely due to the strength of banking and oil and gas stocks. Higher global oil prices, supported in large part by the agreement of the Organization of Petroleum Exporting Countries (OPEC) to curtail production, helped to provide a further tailwind to the energy sector. Signs of economic stabilization in China also helped to improve market sentiment. Canadian stocks were also boosted by a surge in financial stocks, as earnings estimates for financial companies were revised upward following the December interest rate hike in the U.S., and expectations of less stringent regulations under President-elect Donald Trump. Conversely, Canadian fixed-income markets declined, as optimism surrounding the President-elect s fiscal policies, were generally viewed as positive for equity markets, did not support the bond markets. Canadian bond markets weakened further in an increasing interest rate environment. The U.S. Federal Reserve increased its key overnight interest rate in December by 25 basis points from.5% to.75% amid improved economic activity in the U.S. Growth in the U.S. was supported by a strong labour market, positive consumer sentiment, increased government spending and robust consumption. The Bank of Canada maintained its overnight interest rate at.5%. Factors Affecting Performance: The Fund s benchmark returned 5.2% for the six-month period ended. This benchmark consists of 5.% S&P/TSX Capped Composite Index, 4.% FTSE TMX Canada Universe Bond Index, and 1.% The BofA Merrill Lynch US High-Yield Constrained Index. The Fund s underperformance of its benchmark was primarily attributable to stock selection among equities. Investments in the energy, materials and financials sectors detracted from relative performance. In the energy sector, lower-than-benchmark exposure to Suncor Energy detracted from relative performance as the stock benefited from recovering oil prices. In the materials sector, exposure to gold companies such as Randgold Resources, Tahoe Resources, Detour Gold and Agnico Eagle Mines detracted amid a decline in gold prices. In the financials sector, lower-than-benchmark exposure to insurance company Manulife Financial detracted from relative performance. Conversely, lower-than-benchmark exposure to telecommunications company BCE contributed to relative returns. An investment in restaurant operator Restaurant Brands International also contributed to relative returns. Lower-than-benchmark exposure to Canadian investment-grade bonds contributed to relative performance. Canadian investment-grade bonds were weaker after the U.S. election, as the new administration s plans for fiscal policy were perceived to be more favourable for equity markets. Portfolio Changes: During the review period, the Fund s equity portfolio manager Darren Lekkerkerker aimed to diversify holdings across sectors where he found attractive opportunities. Exposure to the financials sector was increased, particularly among bank stocks such as Royal Bank of Canada and Toronto-Dominion Bank, due to attractive valuations. Darren also added exposure to the information technology sector where he increased holdings in software services company CGI Group. Exposure to oil and gas firms Suncor Energy, Seven Generations Energy, Parkland Fuel and EOG Resources was also increased. Conversely, exposure to less economically sensitive sectors such as telecommunication services and utilities was reduced as the manager found attractive opportunities elsewhere. There were no significant changes to Canadian investment-grade bond holdings over the review period. Portfolio managers Catriona Martin and Sri Tella continue to hold a larger-than-benchmark weighting in corporate bonds because they believe this sector continues to provide attractive yield and exhibit stable fundamentals. The portfolio managers continued to hold lower-than-benchmark exposure to the government sector. In the securitized sector, the Fund continued to have more exposure than the benchmark to asset-backed securities, and also maintained a larger-than-benchmark position in commercial mortgage-backed securities for yield and diversification benefits. 1

4 Fidelity Canadian Balanced Fund Management Discussion of Fund Performance continued Recent Developments The Fund s lead portfolio managers, Geoff Stein and David Wolf, seek to maintain a broadly stable asset allocation in line with the Fund s blended benchmark. The Fund s equity portfolio manager Darren Lekkerkerker continues to focus primarily on company fundamentals and evaluating investment opportunities stock by stock. He believes earnings growth has started to improve while valuations have moved higher than historical averages; however, he remains positive on the overall market environment. The Fund s Canadian investment-grade bond portfolio managers, Catriona Martin and Sri Tella, believe the Canadian economy will continue to operate in a low-growth environment, supported by accommodative monetary and financial conditions and federal fiscal measures. Following the U.S. election, global bond yields, including those in Canada, have risen significantly in anticipation of fiscal expansion in the U.S. economy. The portfolio managers aim to maintain liquidity in order to be positioned to take advantage of buying opportunities. The Fund s U.S. high-yield portfolio manager Harley J. Lank believes the economic environment is favourable for the high-yield market, because lower interest rates benefit high-yield issuers by enabling them to refinance their balance sheets. He maintains the view that the U.S. economy continues to realize slow but steady growth, and company fundamentals are expected to improve in the short- to medium-term. He continues to position the Fund defensively to seek to preserve capital. At the end of the review period, Canadian equities accounted for the highest absolute exposure in the Fund, followed by Canadian investment-grade bonds. 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. Fidelity has entered into sub-advisory agreements with a number of entities including Fidelity Investments Money Management, Inc., FMR Co., Inc., FIAM LLC and Fidelity (Canada) Asset Management ULC, 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 $35,334, for the period ended. 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 $3,367, for the period ended. 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 less than $5 for the period ended. 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 Canadian Balanced Fund Series A Six-months ended Periods ended June 3, Net assets, beginning of period B $ $ $ $ $ $ Total revenue Total expenses (excluding distributions) (.282) (.5557) (.5846) (.531) (.4747) (.4544) Realized gains (losses) (.1187) Unrealized gains (losses) (.728) (2.7131) (.2667) Total increase (decrease) from operations B.5951 (.1857) (.1863) From net investment income (excluding dividends) (.88) (.1622) (.1576) (.169) (.1354) (.2186) From dividends (.823) (.361) (.551) (.434) (.122) (.421) From capital gains (1.1587) (1.691) (1.1589) (.1957) (.271) Return of capital Total distributions B,C (1.3218) (1.8893) (1.3716) (.153) (.4333) (.5317) Net assets, end of period B $ $ $ $ $ $ Net asset value (s) D $ 74,515 $ 785,811 $ 987,712 $ 1,13,79 $ 1,17,75 $ 1,389,239 Securities outstanding D 33,39,778 34,6,325 39,355,699 45,857,814 56,411,14 7,61,238 Management expense ratio E,F 2.28% 2.29% 2.32% 2.35% 2.31% 2.27% Management expense ratio before waivers or absorptions E,F 2.34% 2.35% 2.35% 2.35% 2.31% 2.27% Trading expense ratio G.6%.5%.3%.5%.6%.7% Portfolio turnover rate H 36.62% 75.43% 51.31% 44.41% 54.67% 74.18% Net asset value per security, end of period $ $ $ $ $ $

7 Fidelity Canadian Balanced Fund Series B Six-months ended Periods ended June 3, The Series Net Assets per Security A Net assets, beginning of period B $ $ $ $ $ $ Increase (decrease) from operations: Total revenue Total expenses (excluding distributions) (.2551) (.536) (.5289) (.4778) (.431) (.4139) Realized gains (losses) (.156) Unrealized gains (losses) (.767) (2.6835) (.2647) Total increase (decrease) from operations B.617 (.117) (.13) From net investment income (excluding dividends) (.876) (.1957) (.1943) (.1491) (.1572) (.2499) From dividends (.892) (.45) (.619) (.558) (.1186) (.433) From capital gains (1.177) (1.741) (1.172) (.226) (.2784) Return of capital Total distributions B,C (1.3475) (1.943) (1.4282) (.249) (.4784) (.5716) Net assets, end of period B $ $ $ $ $ $ Ratios and Supplemental Data Net asset value (s) D $ 2,584,198 $ 2,643,672 $ 2,914,96 $ 2,57,91 $ 2,289,4 $ 2,288,174 Securities outstanding D 115,289, ,41, ,111,639 16,849,92 11,335, ,374,34 Management expense ratio E,F 2.7% 2.7% 2.1% 2.11% 2.1% 2.7% Management expense ratio before waivers or absorptions E,F 2.11% 2.11% 2.11% 2.11% 2.1% 2.7% Trading expense ratio G.6%.5%.3%.5%.6%.7% Portfolio turnover rate H 36.62% 75.43% 51.31% 44.41% 54.67% 74.18% Net asset value per security, end of period $ $ $ $ $ $

8 Financial Highlights continued Fidelity Canadian Balanced Fund Series F Six-months ended Periods ended June 3, Net assets, beginning of period B $ $ $ $ $ $ Total revenue Total expenses (excluding distributions) (.1179) (.2277) (.2393) (.2149) (.1935) (.1874) Realized gains (losses) (.114) Unrealized gains (losses) (.1326) (2.3522) (.314) Total increase (decrease) from operations B From net investment income (excluding dividends) (.1251) (.3795) (.3867) (.356) (.271) (.4283) From dividends (.1275) (.641) (.958) (.116) (.245) (.498) From capital gains (1.2357) (1.7766) (1.2412) (.2421) (.321) Return of capital Total distributions B,C (1.4883) (2.222) (1.7237) (.472) (.7176) (.7982) Net assets, end of period B $ $ $ $ $ $ Net asset value (s) D $ 215,72 $ 185,426 $ 128,941 $ 65,51 $ 44,91 $ 44,755 Securities outstanding D 9,634,72 8,46,444 5,167,63 2,724,687 2,124,231 2,255,448 Management expense ratio E,I.92%.92%.93%.95%.95%.94% Management expense ratio before waivers or absorptions E,I.93%.93%.95%.95%.95%.94% Trading expense ratio G.6%.5%.3%.5%.6%.7% Portfolio turnover rate H 36.62% 75.43% 51.31% 44.41% 54.67% 74.18% Net asset value per security, end of period $ $ $ $ $ $ Fidelity Canadian Balanced Fund Series F5 Six-months ended Periods ended June 3, J Net assets, beginning of period B $ $ $ $ $ 15. Total revenue Total expenses (excluding distributions) (.769) (.1496) (.1611) (.1511) (.149) Realized gains (losses) Unrealized gains (losses) (.761) (1.6777) Total increase (decrease) from operations B From net investment income (excluding dividends) (.688) (.2175) (.2283) (.2518) (.356) From dividends (.72) (.42) (.712) (.999) (.269) From capital gains (.865) (1.1989) (.865) Return of capital (.394) (.5842) (.5951) (.495) (.625) Total distributions B,C (1.2549) (2.426) (1.7596) (.8422) (.125) Net assets, end of period B $ $ $ $ $ Net asset value (s) D $ 8,866 $ 8,498 $ 5,395 $ 1,425 $ 1 Securities outstanding D 68, ,5 318,893 83, Management expense ratio E,I.91%.89%.9%.93%.81% Management expense ratio before waivers or absorptions E,I.91%.91%.92%.93%.81% Trading expense ratio G.6%.5%.3%.5%.6% Portfolio turnover rate H 36.62% 75.43% 51.31% 44.41% 54.67% Net asset value per security, end of period $ $ $ $ $

9 Fidelity Canadian Balanced Fund Series F8 Six-months ended Periods ended June 3, J Net assets, beginning of period B $ $ $ $ $ 15. Total revenue Total expenses (excluding distributions) (.694) (.1398) (.1554) (.1498) (.231) Realized gains (losses) Unrealized gains (losses) (.113) (1.2195) (.3756) Total increase (decrease) from operations B (.1166) From net investment income (excluding dividends) (.739) (.2344) (.2558) (.251) (.524) From dividends (.753) (.46) (.647) (.834) (.395) From capital gains (.7219) (1.192) (.8256) Return of capital (.4887) (.976) (1.23) (.9543) (.181) Total distributions B,C (1.3598) (2.362) (2.1691) (1.2887) (.2) Net assets, end of period B $ $ $ $ $ Net asset value (s) D $ 8,252 $ 5,876 $ 3,236 $ 1,79 $ 55 Securities outstanding D 636, ,471 21,888 65,531 3,639 Management expense ratio E,I.91%.9%.91%.92%.93% Management expense ratio before waivers or absorptions E,I.92%.92%.93%.92%.93% Trading expense ratio G.6%.5%.3%.5%.6% Portfolio turnover rate H 36.62% 75.43% 51.31% 44.41% 54.67% Net asset value per security, end of period $ $ $ $ $

10 Financial Highlights continued Fidelity Canadian Balanced Fund Series O Six-months ended Periods ended June 3, The Series Net Assets per Security A Net assets, beginning of period B $ $ $ $ $ $ Increase (decrease) from operations: Total revenue Total expenses (excluding distributions) (.9) (.157) (.113) (.6) Realized gains (losses) (.143) Unrealized gains (losses) (.99) (2.5667) (.2456) Total increase (decrease) from operations B From net investment income (excluding dividends) (.1552) (.5271) (.544) (.5251) (.3649) (.5772) From dividends (.1581) (.826) (.1234) (.1656) (.2753) (.551) From capital gains (1.2863) (1.8291) (1.2936) (.2748) (.3547) Return of capital Total distributions B,C (1.5996) (2.4388) (1.9574) (.697) (.915) (.987) Net assets, end of period B $ $ $ $ $ $ Ratios and Supplemental Data Net asset value (s) D $ 3,163,448 $ 3,89,648 $ 3,193,68 $ 2,932,587 $ 2,76,997 $ 2,699,669 Securities outstanding D 141,196, ,536, ,928,7 122,494,926 13,544,35 136,172,132 Management expense ratio K % % % % % % Management expense ratio before waivers or absorptions K % % % % % % Trading expense ratio G.6%.5%.3%.5%.6%.7% Portfolio turnover rate H 36.62% 75.43% 51.31% 44.41% 54.67% 74.18% Net asset value per security, end of period $ $ $ $ $ $

11 Fidelity Canadian Balanced Fund Series T5 Six-months ended Periods ended June 3, Net assets, beginning of period B $ $ $ $ $ $ Total revenue Total expenses (excluding distributions) (.1497) (.369) (.3364) (.3171) (.2948) (.2928) Realized gains (losses) (.756) Unrealized gains (losses) (.288) (1.4991) (.1819) Total increase (decrease) from operations B.324 (.1222) (.1273) From net investment income (excluding dividends) (.418) (.858) (.878) (.626) (.84) (.1417) From dividends (.429) (.196) (.313) (.26) (.633) (.273) From capital gains (.651) (.924) (.662) (.122) (.176) Return of capital (.288) (.5878) (.614) (.5665) (.546) (.5353) Total distributions B,C (.976) (1.6172) (1.3951) (.6551) (.899) (.883) Net assets, end of period B $ $ $ $ $ $ Net asset value (s) D $ 19,42 $ 2,38 $ 27,248 $ 36,689 $ 42,228 $ 46,564 Securities outstanding D 1,666,111 1,654,43 1,969,84 2,613,541 3,352,235 3,75,978 Management expense ratio E,F 2.31% 2.31% 2.34% 2.35% 2.31% 2.26% Management expense ratio before waivers or absorptions E,F 2.37% 2.37% 2.36% 2.35% 2.31% 2.26% Trading expense ratio G.6%.5%.3%.5%.6%.7% Portfolio turnover rate H 36.62% 75.43% 51.31% 44.41% 54.67% 74.18% Net asset value per security, end of period $ $ $ $ $ $ Fidelity Canadian Balanced Fund Series T8 Six-months ended Periods ended June 3, Net assets, beginning of period B $ $ 1.36 $ $ $ $ Total revenue Total expenses (excluding distributions) (.149) (.228) (.2497) (.243) (.2346) (.2434) Realized gains (losses) (.695) Unrealized gains (losses) (.154) (1.724) (.1661) Total increase (decrease) from operations B.2321 (.727) (.136) From net investment income (excluding dividends) (.297) (.63) (.666) (.493) (.665) (.1149) From dividends (.33) (.144) (.237) (.22) (.52) (.225) From capital gains (.4245) (.678) (.4955) (.967) (.1447) Return of capital (.3515) (.733) (.776) (.7458) (.769) (.878) Total distributions B,C (.836) (1.4812) (1.3618) (.8153) (.9824) (1.899) Net assets, end of period B $ $ $ 1.36 $ $ $ Net asset value (s) D $ 2,161 $ 23,53 $ 32,29 $ 47,36 $ 63,55 $ 88,69 Securities outstanding D 2,48,189 2,639,24 3,126,33 4,456,311 6,457,6 8,735,444 Management expense ratio E,F 2.29% 2.29% 2.32% 2.34% 2.31% 2.28% Management expense ratio before waivers or absorptions E,F 2.36% 2.35% 2.35% 2.34% 2.31% 2.28% Trading expense ratio G.6%.5%.3%.5%.6%.7% Portfolio turnover rate H 36.62% 75.43% 51.31% 44.41% 54.67% 74.18% Net asset value per security, end of period $ $ $ 1.31 $ $ $

12 Financial Highlights continued Fidelity Canadian Balanced Fund Series S5 Six-months ended Periods ended June 3, Net assets, beginning of period B $ $ $ $ $ $ Total revenue Total expenses (excluding distributions) (.1371) (.2794) (.355) (.2885) (.272) (.2697) Realized gains (losses) (.623) Unrealized gains (losses) (.346) (1.5883) (.174) Total increase (decrease) from operations B.3362 (.1434) (.758) From net investment income (excluding dividends) (.466) (.175) (.1119) (.892) (.978) (.1618) From dividends (.477) (.226) (.359) (.335) (.738) (.283) From capital gains (.6222) (.9454) (.6781) (.1272) (.1819) Return of capital (.2758) (.579) (.5947) (.5519) (.5249) (.5165) Total distributions B,C (.9923) (1.6464) (1.426) (.6746) (.8237) (.8885) Net assets, end of period B $ $ $ $ $ $ Net asset value (s) D $ 39,583 $ 41,546 $ 51,81 $ 44,21 $ 38,112 $ 37,934 Securities outstanding D 3,339,854 3,319,994 3,594,346 3,118,34 2,994,125 2,992,874 Management expense ratio E,F 2.7% 2.8% 2.1% 2.11% 2.11% 2.8% Management expense ratio before waivers or absorptions E,F 2.11% 2.11% 2.11% 2.11% 2.11% 2.8% Trading expense ratio G.6%.5%.3%.5%.6%.7% Portfolio turnover rate H 36.62% 75.43% 51.31% 44.41% 54.67% 74.18% Net asset value per security, end of period $ $ $ $ $ $

13 Fidelity Canadian Balanced Fund Series S8 Six-months ended Periods ended June 3, Net assets, beginning of period B $ $ $ $ $ $ Total revenue Total expenses (excluding distributions) (.969) (.228) (.2287) (.2224) (.2151) (.2233) Realized gains (losses) (.57) Unrealized gains (losses) (.279) (1.666) (.1382) Total increase (decrease) from operations B.2365 (.33) (.66) From net investment income (excluding dividends) (.332) (.785) (.841) (.693) (.783) (.1337) From dividends (.337) (.165) (.271) (.263) (.591) (.235) From capital gains (.4385) (.6895) (.599) (.117) (.157) Return of capital (.3518) (.729) (.77) (.7383) (.7626) (.822) Total distributions B,C (.8572) (1.5135) (1.3911) (.8339) (1.17) (1.111) Net assets, end of period B $ $ $ $ $ $ Net asset value (s) D $ 129,571 $ 135,45 $ 154,644 $ 141,623 $ 128,166 $ 128,448 Securities outstanding D 15,589,41 15,151,541 14,745,937 13,117,825 12,836,233 12,494,858 Management expense ratio E,F 2.7% 2.7% 2.9% 2.11% 2.1% 2.7% Management expense ratio before waivers or absorptions E,F 2.1% 2.1% 2.11% 2.11% 2.1% 2.7% Trading expense ratio G.6%.5%.3%.5%.6%.7% Portfolio turnover rate H 36.62% 75.43% 51.31% 44.41% 54.67% 74.18% Net asset value per security, end of period $ $ $ $ $ $

14 Financial Highlights continued Fidelity Canadian Balanced Fund Series E1 Six-months ended Periods ended June 3, L Net assets, beginning of period B $ $ 1. Total revenue Total expenses (excluding distributions) (.115) (.864) Realized gains (losses) Unrealized gains (losses) (.965).3828 Total increase (decrease) from operations B From net investment income (excluding dividends) (.43) (.495) From dividends (.411) From capital gains (.5353) Return of capital Total distributions B,C (.6167) (.495) Net assets, end of period B $ $ Net asset value (s) D $ 38,559 $ 219,71 Securities outstanding D 3,188,776 2,854,432 Management expense ratio E,M 2.5% 2.6% Management expense ratio before waivers or absorptions E,M 2.8% 2.9% Trading expense ratio G.6%.5% Portfolio turnover rate H 36.62% 75.43% Net asset value per security, end of period $ $ Fidelity Canadian Balanced Fund Series E1T5 Six-months ended Periods ended June 3, L Net assets, beginning of period B $ 2.89 $ 2. Total revenue Total expenses (excluding distributions) (.2244) (.1718) Realized gains (losses) Unrealized gains (losses) (.2779).874 Total increase (decrease) from operations B From net investment income (excluding dividends) (.78) (.979) From dividends (.798) From capital gains (1.344) Return of capital (.4564) (.3361) Total distributions B,C (1.6486) (.434) Net assets, end of period B $ $ 2.89 Net asset value (s) D $ 9,813 $ 5,588 Securities outstanding D 495, ,66 Management expense ratio E,M 2.5% 2.6% Management expense ratio before waivers or absorptions E,M 2.9% 2.9% Trading expense ratio G.6%.5% Portfolio turnover rate H 36.62% 75.43% Net asset value per security, end of period $ $

15 Fidelity Canadian Balanced Fund Series E2 Six-months ended Periods ended June 3, L Net assets, beginning of period B $ $ 1. Total revenue Total expenses (excluding distributions) (.1134) (.84) Realized gains (losses) Unrealized gains (losses) (.115).369 Total increase (decrease) from operations B From net investment income (excluding dividends) (.47) (.517) From dividends (.417) From capital gains (.5359) Return of capital Total distributions B,C (.6183) (.517) Net assets, end of period B $ $ Net asset value (s) D $ 31,58 $ 22,371 Securities outstanding D 3,136,37 2,121,495 Management expense ratio E,M 2.1% 2.2% Management expense ratio before waivers or absorptions E,M 2.5% 2.5% Trading expense ratio G.6%.5% Portfolio turnover rate H 36.62% 75.43% Net asset value per security, end of period $ $ Fidelity Canadian Balanced Fund Series E2T5 Six-months ended Periods ended June 3, L Net assets, beginning of period B $ $ 2. Total revenue Total expenses (excluding distributions) (.2149) (.161) Realized gains (losses) Unrealized gains (losses) Total increase (decrease) from operations B From net investment income (excluding dividends) (.816) (.1112) From dividends (.836) From capital gains (1.364) Return of capital (.4491) (.3228) Total distributions B,C (1.657) (.434) Net assets, end of period B $ $ Net asset value (s) D $ 331 $ 2,793 Securities outstanding D 16, ,221 Management expense ratio E,M 1.93% 1.92% Management expense ratio before waivers or absorptions E,M 1.96% 1.95% Trading expense ratio G.6%.5% Portfolio turnover rate H 36.62% 75.43% Net asset value per security, end of period $ $

16 Financial Highlights continued Fidelity Canadian Balanced Fund Series E3 Six-months ended Periods ended June 3, L Net assets, beginning of period B $ $ 1. Total revenue Total expenses (excluding distributions) (.1136) (.799) Realized gains (losses) Unrealized gains (losses) (.29).3762 Total increase (decrease) from operations B From net investment income (excluding dividends) (.46) (.562) From dividends (.414) From capital gains (.5356) Return of capital Total distributions B,C (.6176) (.562) Net assets, end of period B $ $ Net asset value (s) D $ 4,59 $ 1,652 Securities outstanding D 448, ,754 Management expense ratio E,M 2.3% 1.93% Management expense ratio before waivers or absorptions E,M 2.7% 1.96% Trading expense ratio G.6%.5% Portfolio turnover rate H 36.62% 75.43% Net asset value per security, end of period $ $ Fidelity Canadian Balanced Fund Series E3T5 Six-months ended N Net assets, beginning of period B $ 2. Total revenue.1722 Total expenses (excluding distributions) (.113) Realized gains (losses).2818 Unrealized gains (losses) (.159) Total increase (decrease) from operations B.1847 From net investment income (excluding dividends) (.754) From dividends (.772) From capital gains (.994) Return of capital (.2684) Total distributions B,C (1.415) Net assets, end of period B $ Net asset value (s) D $ 818 Securities outstanding D 43,579 Management expense ratio E,O 1.89% Management expense ratio before waivers or absorptions E,O 1.93% Trading expense ratio G.6% Portfolio turnover rate H 36.62% Net asset value per security, end of period $

17 Fidelity Canadian Balanced Fund Series E4 Six-months ended Periods ended June 3, L Net assets, beginning of period B $ $ 1. Total revenue Total expenses (excluding distributions) (.142) (.86) Realized gains (losses) Unrealized gains (losses) (.765).4192 Total increase (decrease) from operations B From net investment income (excluding dividends) (.435) (.534) From dividends (.443) From capital gains (.543) Return of capital Total distributions B,C (.6281) (.534) Net assets, end of period B $ $ Net asset value (s) D $ 652 $ 558 Securities outstanding D 63,724 52,924 Management expense ratio E,M 1.84% 2.% Management expense ratio before waivers or absorptions E,M 1.88% 2.3% Trading expense ratio G.6%.5% Portfolio turnover rate H 36.62% 75.43% Net asset value per security, end of period $ $ Fidelity Canadian Balanced Fund Series E4T5 Six-months ended N Net assets, beginning of period B $ 2. Total revenue.1722 Total expenses (excluding distributions) (.173) Realized gains (losses).2818 Unrealized gains (losses) (.159) Total increase (decrease) from operations B.1877 From net investment income (excluding dividends) (.769) From dividends (.788) From capital gains (.9965) Return of capital (.2655) Total distributions B,C (1.4177) Net assets, end of period B $ Net asset value (s) D $ 1,352 Securities outstanding D 72,25 Management expense ratio E,O 1.84% Management expense ratio before waivers or absorptions E,O 1.87% Trading expense ratio G.6% Portfolio turnover rate H 36.62% Net asset value per security, end of period $

18 Financial Highlights continued Fidelity Canadian Balanced Fund Series E5 Six-months ended Periods ended June 3, L Net assets, beginning of period B $ $ 1. Total revenue Total expenses (excluding distributions) (.99) (.8) Realized gains (losses) Unrealized gains (losses) (.594).29 Total increase (decrease) from operations B From net investment income (excluding dividends) (.427) (.638) From dividends (.434) From capital gains (.5394) Return of capital Total distributions B,C (.6255) (.638) Net assets, end of period B $ $ Net asset value (s) D $ 1 $ 1 Securities outstanding D Management expense ratio E,M 1.89% 1.83% Management expense ratio before waivers or absorptions E,M 1.89% 1.83% Trading expense ratio G.6%.5% Portfolio turnover rate H 36.62% 75.43% Net asset value per security, end of period $ $ Fidelity Canadian Balanced Fund Series P1 Six-months ended Periods ended June 3, P Net assets, beginning of period B $ $ 1. Total revenue Total expenses (excluding distributions) (.471) (.497) Realized gains (losses) Unrealized gains (losses) (.187).45 Total increase (decrease) from operations B From net investment income (excluding dividends) (.515) (.1263) From dividends (.524) (.125) From capital gains (.553) (.7255) Return of capital Total distributions B,C (.692) (.8643) Net assets, end of period B $ $ Net asset value (s) D $ 36,917 $ 17,368 Securities outstanding D 4,26,32 1,843,12 Management expense ratio E,Q.9%.9% Management expense ratio before waivers or absorptions E,Q.9%.9% Trading expense ratio G.6%.5% Portfolio turnover rate H 36.62% 75.43% Net asset value per security, end of period $ $

19 Fidelity Canadian Balanced Fund Series P1T5 Six-months ended Periods ended June 3, P Net assets, beginning of period B $ $ 2. Total revenue Total expenses (excluding distributions) (.923) (.97) Realized gains (losses) Unrealized gains (losses) (.115).3157 Total increase (decrease) from operations B From net investment income (excluding dividends) (.835) (.27) From dividends (.851) (.251) From capital gains (.9785) (1.4526) Return of capital (.3752) (.3795) Total distributions B,C (1.5223) (2.642) Net assets, end of period B $ $ Net asset value (s) D $ 1,663 $ 3,14 Securities outstanding D 95,74 162,449 Management expense ratio E,Q.89%.89% Management expense ratio before waivers or absorptions E,Q.89%.9% Trading expense ratio G.6%.5% Portfolio turnover rate H 36.62% 75.43% Net asset value per security, end of period $ $ Fidelity Canadian Balanced Fund Series P2 Six-months ended Periods ended June 3, P Net assets, beginning of period B $ $ 1. Total revenue Total expenses (excluding distributions) (.459) (.486) Realized gains (losses) Unrealized gains (losses) (.14) (.249) Total increase (decrease) from operations B From net investment income (excluding dividends) (.517) (.1271) From dividends (.526) (.125) From capital gains (.56) (.7255) Return of capital Total distributions B,C (.613) (.8651) Net assets, end of period B $ $ Net asset value (s) D $ 5,731 $ 2,543 Securities outstanding D 623,838 27,67 Management expense ratio E,Q.87%.88% Management expense ratio before waivers or absorptions E,Q.88%.89% Trading expense ratio G.6%.5% Portfolio turnover rate H 36.62% 75.43% Net asset value per security, end of period $ $

20 Financial Highlights continued Fidelity Canadian Balanced Fund Series P2T5 Six-months ended N Net assets, beginning of period B $ 2. Total revenue.1684 Total expenses (excluding distributions) (.521) Realized gains (losses).2855 Unrealized gains (losses) (.691) Total increase (decrease) from operations B.3327 From net investment income (excluding dividends) (.889) From dividends (.98) From capital gains (1.431) Return of capital (.2378) Total distributions B,C (1.466) Net assets, end of period B $ Net asset value (s) D $ 654 Securities outstanding D 34,91 Management expense ratio E,O.86% Management expense ratio before waivers or absorptions E,O.86% Trading expense ratio G.6% Portfolio turnover rate H 36.62% Net asset value per security, end of period $ Fidelity Canadian Balanced Fund Series P3 Six-months ended Periods ended June 3, P Net assets, beginning of period B $ $ 1. Total revenue Total expenses (excluding distributions) (.454) (.463) Realized gains (losses) Unrealized gains (losses) (.3272) (.213) Total increase (decrease) from operations B From net investment income (excluding dividends) (.519) (.1298) From dividends (.529) (.125) From capital gains (.564) (.7256) Return of capital Total distributions B,C (.6112) (.8679) Net assets, end of period B $ $ Net asset value (s) D $ 538 $ 1 Securities outstanding D 58, Management expense ratio E,Q.87%.83% Management expense ratio before waivers or absorptions E,Q.87%.83% Trading expense ratio G.6%.5% Portfolio turnover rate H 36.62% 75.43% Net asset value per security, end of period $ $

21 Fidelity Canadian Balanced Fund Series P3T5 Six-months ended N Net assets, beginning of period B $ 2. Total revenue.1858 Total expenses (excluding distributions) (.495) Realized gains (losses).3589 Unrealized gains (losses) (.5314) Total increase (decrease) from operations B (.362) From net investment income (excluding dividends) (.89) From dividends (.99) From capital gains (1.454) Return of capital (.2378) Total distributions B,C (1.4631) Net assets, end of period B $ Net asset value (s) D $ 221 Securities outstanding D 11,783 Management expense ratio E,O.8% Management expense ratio before waivers or absorptions E,O.8% Trading expense ratio G.6% Portfolio turnover rate H 36.62% Net asset value per security, end of period $ Fidelity Canadian Balanced Fund Series P4 Six-months ended Periods ended June 3, P Net assets, beginning of period B $ $ 1. Total revenue Total expenses (excluding distributions) (.426) (.445) Realized gains (losses) Unrealized gains (losses) (.36).3512 Total increase (decrease) from operations B From net investment income (excluding dividends) (.529) (.136) From dividends (.538) (.125) From capital gains (.581) (.7256) Return of capital Total distributions B,C (.6148) (.8687) Net assets, end of period B $ $ Net asset value (s) D $ 391 $ 44 Securities outstanding D 42,643 42,636 Management expense ratio E,Q.8%.81% Management expense ratio before waivers or absorptions E,Q.8%.81% Trading expense ratio G.6%.5% Portfolio turnover rate H 36.62% 75.43% Net asset value per security, end of period $ $

22 Financial Highlights continued Fidelity Canadian Balanced Fund Series P4T5 Six-months ended N Net assets, beginning of period B $ 2. Total revenue.1765 Total expenses (excluding distributions) (.392) Realized gains (losses).2745 Unrealized gains (losses) (.1765) Total increase (decrease) from operations B.2353 From net investment income (excluding dividends) (.89) From dividends (.99) From capital gains (1.449) Return of capital (.2378) Total distributions B,C (1.4626) Net assets, end of period B $ Net asset value (s) D $ 1 Securities outstanding D 54 Management expense ratio E,O.82% Management expense ratio before waivers or absorptions E,O.82% Trading expense ratio G.6% Portfolio turnover rate H 36.62% Net asset value per security, end of period $ Fidelity Canadian Balanced Fund Series P5 Six-months ended Periods ended June 3, R Net assets, beginning of period B $ $ 1. Total revenue Total expenses (excluding distributions) (.434) (.98) Realized gains (losses) Unrealized gains (losses) (.451).156 Total increase (decrease) from operations B From net investment income (excluding dividends) (.574) (.61) From dividends (.586) From capital gains (.5479) Return of capital Total distributions B,C (.6639) (.61) Net assets, end of period B $ $ Net asset value (s) D $ 4,175 $ 4,47 Securities outstanding D 423, ,382 Management expense ratio E,S.75%.75% Management expense ratio before waivers or absorptions E,S.76%.76% Trading expense ratio G.6%.5% Portfolio turnover rate H 36.62% 75.43% Net asset value per security, end of period $ $

23 Fidelity Canadian Balanced Fund Series P5T5 Six-months ended N Net assets, beginning of period B $ 2. Total revenue.1724 Total expenses (excluding distributions) (.464) Realized gains (losses).2822 Unrealized gains (losses) (.1594) Total increase (decrease) from operations B.2488 From net investment income (excluding dividends) (.89) From dividends (.912) From capital gains (1.481) Return of capital (.2378) Total distributions B,C (1.4661) Net assets, end of period B $ Net asset value (s) D $ 1,312 Securities outstanding D 69,872 Management expense ratio E,O.75% Management expense ratio before waivers or absorptions E,O.76% Trading expense ratio G.6% Portfolio turnover rate H 36.62% Net asset value per security, end of period $

24 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, 213 follow International Financial Reporting Standards (IFRS) and periods prior to January 1, 213 follow Canadian Generally Accepted Accounting Principles (Canadian GAAP). The net assets attributable to holders of redeemable securities 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. 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 unitholders. Distributions are presented based on management s best estimate of the tax character. 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, 214, 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 1% 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 Effective October 1, 215, 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. J For the period April 17, 213 (commencement of sale of securities) to June 3, 213. K No fees are charged to the Series, but investors may be charged a negotiated management fee. L For the period February 5, (commencement of sale of securities) to June 3,. M 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. N For the period September 16, (commencement of sale of securities) to. O Effective September 2,, 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. P For the period December 4, 215 (commencement of sale of securities) to June 3,. Q Effective December 8, 215, 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. R For the period May 13, (commencement of sale of securities) to June 3,. S Effective May 17,, 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. 22

25 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 1% 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 1.85% 43.25% 56.75% Series B 1.7% 58.82% 41.18% Series F.7% 1.% Series F5.7% 1.% Series F8.7% 1.% Series T5 1.85% 51.18% 48.82% Series T8 1.85% 37.62% 62.38% Series S5 1.7% 58.82% 41.18% Series S8 1.7% 58.82% 41.18% Series E1 1.7% 58.82% 41.18% Series E1T5 1.7% 58.82% 41.18% Series E % 59.7% 4.3% Series E2T % 59.7% 4.3% Series E % 59.7% 4.3% Series E3T % 59.7% 4.3% Series E4 1.65% 6.61% 39.39% Series E4T5 1.65% 6.61% 39.39% Series E5 1.6% 62.5% 37.5% Series P1.7% 1.% Series P1T5.7% 1.% Series P2.675% 1.% Series P2T5.675% 1.% Series P3.675% 1.% Series P3T5.675% 1.% Series P4.65% 1.% Series P4T5.65% 1.% Series P5.6% 1.% Series P5T5.6% 1.% 23

26 Fidelity Canadian Balanced 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 B Series F