Fidelity International Growth Fund Key Takeaways The fund's Retail Class shares rose 24.14% for the fiscal year ending October 31, 2017, surpassing the MSCI EAFE Growth Index, which returned 23.83%. Manager Jed Weiss was generally pleased that the fund was able to outperform the benchmark despite limited market volatility, which he looks for as an opportunity to invest in strong business franchises at attractive valuations. Given the momentum- and growth-led market, the fund's large overweighting in the information technology sector added value, as did stock picking in health care and financials. Picks in consumer staples and a modest cash stake detracted. Geographically, the fund benefited from favorable selection in the U.S. an out-of-benchmark allocation emphasizing companies that do significant business abroad plus Japan and Australia. Underweighting the lagging European market hampered results. Jed plans to continue pursuing his three-pronged management strategy, which emphasizes companies with what he considers multiyear structural-growth prospects, high barriers to entry and attractive valuations based on his earnings forecast. Following a roughly five-month leave of absence, Jed Weiss returned to Fidelity on November 29, 2017, and resumed his day-to-day responsibilities as Manager. In his stead, Vincent Montemaggiore served as interim manager of the fund. MARKET RECAP The MSCI ACWI (All Country World Index) ex USA Index returned 23.85% for the 12 months ending October 31, 2017, helped partly by a generally weak U.S. dollar. Some favorable election results in continental Europe (+30%) suggested ebbing political uncertainty and near-term risk there, but the U.K. (+20%) faced more-mixed conditions ahead of its expected exit from the European Union. Despite central-bank easing and pressured recently by yen strength Japan (+18%) lagged the rest of the Asia-Pacific group (+22%). Commodity-price volatility slowed Canada (+17%), but the emergingmarkets group (+26%) sped ahead. Sector-wise, information technology (+47%) was driven by a surge among several Chinese internet-related names. Financials (+27%) rode rising interest rates that, at the same time, weighed on real estate (+17%), utilities (+16%), consumer staples (+14%) and telecommunication services (+9%) socalled "bond proxy" sectors. Materials (+28%) and industrials (+27%) responded to demand from China and price gains for certain commodities. In the energy sector (+20%), oil prices lost ground in the spring before rebounding through October 31 to end well above where they started 12 months ago. Lastly, health care (+14%) was hurt by early-period turmoil around drug pricing and health care legislation. Not FDIC Insured May Lose Value No Bank Guarantee
Q&A A (late-november) interview with Manager Jed Weiss Jed Weiss Co-Manager Fund Facts Trading Symbol: FIGFX Vincent Montemaggiore Co-Manager Start Date: November 01, 2007 Size (in millions): $2,322.82 Investment Approach Fidelity International Growth Fund is a diversified international equity strategy with a large-cap growth orientation. Our investment approach targets companies with multiyear structural growth prospects, high barriers to entry and attractive valuations based on our earnings forecasts. Investment ideas typically fall into three main categories: structurally attractive growth themes, where investors may be underestimating the durability of growth drivers and long-term earnings power; cyclically out-of-favor companies with limited competition and pricing power, where investors may be focusing on near-term cyclical concerns and discounting long-term prospects; and companies with strong earnings potential whose share prices have fallen due to macroeconomic events. We strive to uncover these companies through in-depth fundamental analysis, working in concert with Fidelity's global research team, with the goal of capturing market upside while limiting downside participation. Q: Jed, how did the fund perform for the fiscal year ending October 31, 2017 The fund's Retail Class shares gained 24.14%, outpacing the 23.83% increase in the benchmark MSCI EAFE Growth Index while trailing the peer group average. Momentum- and growth-oriented stocks led a synchronous global recovery, thus our overweighting in the information technology sector where many such stocks reside was a big positive. Stock picking in health care and financials also helped. Selection in consumer staples detracted, though, as did a modest cash stake in a sharply rising market. On a country and region basis, the fund benefited from strong out-of-benchmark stock selection in the U.S., where numerous fund holdings are based even as they do most or all of their business abroad. Favorable picks in Japan and Australia also contributed. In contrast, a big underweighting in the lagging continental European market detracted. As always, sector and country over- and underweightings stem from my bottom-up stock-by-stock management strategy, rather than a top-down effort to identify areas of the market I think will outperform. Q: Were you satisfied with the fund's result relative to the benchmark First, I'd like to thank my colleague Vince Montemaggiore for capably handling the fund during my five-month leave. Now, looking at the fund's relative performance, I'm pleased that we were able to deliver strong absolute performance and to modestly outperform the benchmark, despite an environment that was not ideally suited to my management approach. Throughout the period, the market provided few of the macroeconomic shocks or industry-specific downturns that may be expected to pop up somewhere in the world from time to time and upon which my investment strategy aims to capitalize. In light of the broad, worldwide economic gains, it's been more challenging than usual to find great investment ideas at attractive valuations. To reiterate my management approach: I target companies 2 For definitions, fund risks and other important information, please see the Definitions and Important section of this Q&A.
with multiyear structural growth prospects, high barriers to entry and attractive valuations based on my earnings forecasts. In other words, I look for what I consider inexpensive businesses with a strong competitive position and the potential to generate favorable long-term returns. Q: What about risk management My portfolio-construction process is intended to make bottom-up security selection rather than my opinions about macroeconomic trends the primary driver of the fund's long-term performance. As a result, I try hard to avoid outsized sector over- and underweightings. My risk-management approach also requires me to develop an understanding of all the market areas to which the fund may be exposed. In the end, I regularly segment the fund multiple ways such as by sector, industry, currency, region and theme to better understand the risks the fund is taking, as well as to make any needed adjustments. As an example of how I approach the portfolio, consider its large exposure to information technology. "Officially," the fund carried a tech overweighting averaging 10 percentage points versus the index this period. But when I look at the category on a stock-by-stock basis, I see many names that strike me as misplaced. For example, index provider MSCI classifies fund holdings Visa and Mastercard as tech companies, but I see both as business-services providers. This can also be true in the other direction as well some holdings I consider tech firms, such as Naspers, are not classified as such by MSCI. In general, though, what I see as the fund's actual technology exposure is considerably smaller than what is stated. This is representative of my approach to risk management across every category I'm closely monitoring what I see as the fund's true exposures and maintaining them at levels I consider reasonable. Q: Which stocks contributed to the fund's result relative to the index the past 12 months The fund's biggest individual contributor and one of its largest holdings on October 31 was ASML Holding (+72%), a Dutch company that makes photolithography systems for the semiconductor industry. ASML is the market leader in extreme ultraviolet lithography (EUV), a technology enabling manufacturers to build smaller, more powerful chips. As the period progressed, the market grew increasingly confident in the staying power of EUV, a longdelayed technology that appears to be coming into its own and, in my view, represents a multiyear structural growth opportunity for the company. Although ASML's share-price gains have left it less attractively valued than in the past, I still see good potential here as of period end. Another big contributor this period was out-of-index Alibaba Group Holding, the dominant player in Chinese e- commerce and a leader in several other fast-growing fields, including cloud computing and financial services. I think the market is starting to wake up to Alibaba's potential, and the stock rose accordingly this period, up 82% in the fund. Also adding value was another out-of-index holding: Italy's Interpump Group, a manufacturer of specialty pumps. This company fit my criteria in many ways. Interpump has a dominant competitive position in several market niches, especially among large industrial pumps. Because of this competitive position, the company has demonstrated an ability to hold pricing steady, even during difficult times. Further, Interpump has continued to take market share, and its business has improved along with the industrial economy. The stock's value more than doubled this period. Q: Which stocks detracted Reckitt Benckiser Group (+2%), a U.K.-based company focused on consumer branded goods, hurt relative performance, as the company experienced some businessexecution issues. As of period end, I still think the firm has a strong multiyear growth opportunity across several businesses particularly in emerging markets and after lagging this period, offers a more attractively valued stock. Another detractor was Anheuser-Busch InBev, a Belgiumbased brewer. InBev's shares lagged the benchmark by a wide margin, due primarily to a weak pricing environment and sluggish U.S. market for beer sales. I continued to like InBev, however, for its dominant competitive position in most of its markets, as well as its strong track record of integrating acquired companies, such as SAB Miller, which became part of InBev early in the period. I'd also note that we missed out on a strong performance from French luxury-goods retailer and index component LVMH Moet Hennessy Louis Vuitton, the fund's biggest detractor. LVMH, which has been benefiting from the burgeoning consumer class in China and Europe, did not currently meet my investment criteria, so we didn't own it during the period. Q: Any closing thoughts, Jed In all market conditions, I try to stick to my three-step management strategy, as I look to develop a portfolio with the potential to outperform in both up and down markets. I'm hopeful that my focus on good business franchises with stocks trading at attractive valuations can continue to do well, regardless of the economic backdrop. 3 For definitions, fund risks and other important information, please see the Definitions and Important section of this Q&A.
LARGEST CONTRIBUTORS VS. BENCHMARK Jed Weiss on returning from his leave of absence: "I'm happy with how Vince handled management of the fund while I was on leave. I think all of our preparatory work paid dividends in the form of limited turnover in the portfolio and minimal disruption for shareholders. "Now, after several months of relaxation with my young family, I'm excited to be back. My leave was not only reenergizing but educational, in that it gave me some important investment insights that I hope to apply to the portfolio in the months ahead. "Part of my time away was spent traveling internationally with family. This included a couple of weeks in Japan, an important market for the fund. I engaged in activities I typically wouldn't pursue on a business trip. Instead of attending conferences or visiting corporate headquarters, I got to visit some off-the-beaten-track parts of the country. It gave me a broader perspective on Japan as well as some specific investment ideas I plan to research further. "I also visited a few emerging-market countries some investable for this fund and others not and it broadened my view on some big-picture trends in such areas as telecommunications, payments and foreign investment. "So, even though rest and a recharge were the goals of my leave, gaining some investment insights was definitely one of the ancillary benefits of my time away from the office. Another was my renewed enthusiasm to get back to work on behalf of the fund's shareholders." Holding ASML Holding NV (Netherlands) Alibaba Group Holding Ltd. sponsored ADR Market Segment Average Relative Relative Contribution (basis points)* 1.25% 53 0.89% 52 Interpump Group SpA Industrials 0.71% 47 Keyence Corp. 1.62% 44 CSL Ltd. Health Care 2.31% 37 * 1 basis point = 0.01%. LARGEST DETRACTORS VS. BENCHMARK Holding LVMH Moet Hennessy - Louis Vuitton SA Reckitt Benckiser Group PLC Anheuser-Busch InBev SA NV Market Segment Consumer Discretionary Average Relative Relative Contribution (basis points)* -0.98% -37 Consumer Staples 1.40% -35 Consumer Staples 2.07% -33 Airbus Group NV Industrials -0.69% -30 Molson Coors Brewing Co. Class B * 1 basis point = 0.01%. ASSET ALLOCATION Asset Class Consumer Staples 0.53% -29 Six Months Ago International Equities 80.33% 80.19% Developed Markets 71.13% 71.92% Emerging Markets 9.20% 8.27% Tax-Advantaged Domiciles 0.00% 0.00% Domestic Equities 17.74% 16.73% Bonds 0.00% 0.00% Cash & Net Other Assets 1.93% 3.08% Net Other Assets can include fund receivables, fund payables, and offsets to other derivative positions, as well as certain assets that do not fall into any of the portfolio composition categories. Depending on the extent to which the fund invests in derivatives and the number of positions that are held for future settlement, Net Other Assets can be a negative number. "Tax-Advantaged Domiciles" represent countries whose tax policies may be favorable for company incorporation. 4 For definitions, fund risks and other important information, please see the Definitions and Important section of this Q&A.
MARKET-SEGMENT DIVERSIFICATION Market Segment Six Months Ago 21.93% 18.19% Consumer Staples 17.38% 18.98% Industrials 14.88% 13.97% Health Care 12.10% 14.42% Financials 11.41% 10.51% Consumer Discretionary 10.42% 10.76% Materials 6.60% 6.82% Real Estate 2.16% 2.20% Energy 0.62% 0.63% Telecommunication Services 0.56% 0.44% Utilities 0.00% 0.00% Other 0.00% 0.00% COUNTRY DIVERSIFICATION Country Six Months Ago United States 19.69% 19.76% Japan 13.08% 11.72% United Kingdom 11.30% 11.98% Switzerland 8.02% 10.69% Sweden 5.66% 5.88% Germany 5.24% 4.82% Belgium 4.12% 3.87% Spain 4.07% 4.61% Australia 3.67% 3.61% Ireland 3.29% 3.40% Netherlands 2.48% 2.00% South Africa 2.44% 2.05% Hong Kong 2.27% 2.17% China 1.85% 1.64% France 1.72% -- Austria 1.70% 1.69% Denmark 1.35% 1.34% Canada 1.34% 1.36% Taiwan 1.12% -- Korea (South) 1.07% 1.18% Italy 1.07% 1.07% India 1.03% -- 10 LARGEST HOLDINGS Holding Market Segment Six Months Ago Nestle SA (Reg. S) Consumer Staples 4.90% 5.73% Anheuser-Busch InBev SA NV SAP SE Consumer Staples 3.40% 3.37% 3.14% 2.73% CSL Ltd. Health Care 3.00% 2.92% Keyence Corp. Visa, Inc. Class A ASML Holding NV (Netherlands) MasterCard, Inc. Class A 2.82% 2.12% 2.74% 2.41% 2.48% 2.00% 2.36% 1.97% AIA Group Ltd. Financials 2.27% 2.17% Reckitt Benckiser Group PLC Consumer Staples 2.23% 2.26% 10 Largest Holdings as a % of Net Assets 29.33% 28.58% Total Number of Holdings 97 99 The 10 largest holdings are as of the end of the reporting period, and may not be representative of the fund's current or future investments. Holdings do not include money market investments. 5 For definitions, fund risks and other important information, please see the Definitions and Important section of this Q&A.
FISCAL PERFORMANCE SUMMARY: Periods ending October 31, 2017 6 Month Cumulative YTD 1 3 Annualized 5 10 / LOF 1 Fidelity International Growth Fund Gross Expense Ratio: 0.99% 2 10.79% 26.41% 24.14% 7.61% 9.46% 3.92% MSCI EAFE Growth Index (Net Massachusetts tax) 12.09% 25.42% 23.83% 7.77% 9.44% 2.13% Morningstar Fund Foreign Large Growth 12.91% 27.79% 25.00% 7.54% 9.13% -- % Rank in Morningstar Category (1% = Best) -- -- 53% 44% 37% -- # of Funds in Morningstar Category -- -- 398 325 280 -- 1 Life of Fund (LOF) if performance is less than 10 years. Fund inception date: 11/01/2007. 2 This expense ratio is from the prospectus in effect as of the date shown above and generally is based on amounts incurred during that fiscal year. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate; therefore, you may have a gain or loss when you sell your shares. Current performance may be higher or lower than the performance stated. Performance shown is that of the fund's Retail Class shares (if multiclass). You may own another share class of the fund with a different expense structure and, thus, have different returns. To learn more or to obtain the most recent month-end or other share-class performance, visit fidelity.com/performance, institutional.fidelity.com, or 401k.com. Total returns are historical and include change in share value and reinvestment of dividends and capital gains, if any. Cumulative total returns are reported as of the period indicated. Please see the last page(s) of this Q&A document for most-recent calendarquarter performance. 6 For definitions, fund risks and other important information, please see the Definitions and Important section of this Q&A.
Definitions and Important Unless otherwise disclosed to you, in providing this information, Fidelity is not undertaking to provide impartial investment advice, act as an impartial adviser, or to give advice in a fiduciary capacity. FUND RISKS Stock markets, especially foreign markets, are volatile and can decline significantly in response to adverse issuer, political, regulatory, market, or economic developments. Foreign securities are subject to interest rate, currency exchange rate, economic, and political risks, all of which are magnified in emerging markets. IMPORTANT FUND INFORMATION Relative positioning data presented in this commentary is based on the fund's primary benchmark (index) unless a secondary benchmark is provided to assess performance. Effective 4/1/17, Vince Montemaggiore has been named interim comanager of the fund. Jed Weiss will remain co-manager until 6/15/17 when he will begin a leave of absence. Mr. Weiss is expected to return as the sole portfolio manager on 11/29/17. Effective 6/15/17, Jed Weiss and Vincent Montemaggiore are coportfolio managers of the fund. Effective 12/5/17, Jed Weiss became the sole portfolio manager as Vincent Montemaggiore transitioned off the fund. the most up-to-date information concerning applicable loads, fees and expenses. % Rank in Morningstar Category is the fund's total-return percentile rank relative to all funds that have the same Morningstar Category. The highest (or most favorable) percentile rank is 1 and the lowest (or least favorable) percentile rank is 100. The top-performing fund in a category will always receive a rank of 1%. % Rank in Morningstar Category is based on total returns which include reinvested dividends and capital gains, if any, and exclude sales charges. Multiple share classes of a fund have a common portfolio but impose different expense structures. RELATIVE WEIGHTS Relative weights represents the % of fund assets in a particular market segment, asset class or credit quality relative to the benchmark. A positive number represents an overweight, and a negative number is an underweight. The fund's benchmark is listed immediately under the fund name in the Performance Summary. INDICES It is not possible to invest directly in an index. All indices represented are unmanaged. All indices include reinvestment of dividends and interest income unless otherwise noted. MSCI EAFE Growth Index (Net MA Tax) is a market-capitalizationweighted index that is designed to measure the investable equity market performance of growth stocks for global investors in developed markets, excluding the U.S. & Canada. Index returns are adjusted for tax withholding rates applicable to U.S. based mutual funds organized as Massachusetts business trusts. MSCI ACWI (All Country World Index) ex USA Index is a marketcapitalization-weighted index that is designed to measure the investable equity market performance for global investors of developed and emerging markets, excluding the United States. MARKET-SEGMENT WEIGHTS Market-segment weights illustrate examples of sectors or industries in which the fund may invest, and may not be representative of the fund's current or future investments. Should not be construed or used as a recommendation for any sector or industry. RANKING INFORMATION 2017 Morningstar, Inc. All rights reserved. The Morningstar information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or redistributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Fidelity does not review the Morningstar data and, for mutual fund performance, you should check the fund's current prospectus for 7
Manager Facts Jed Weiss is a portfolio manager at Fidelity Management & Research Company (FMR Co.), the investment advisor for Fidelity's family of mutual funds. Fidelity Investments is a leading provider of investment management, retirement planning, portfolio guidance, brokerage, benefits outsourcing and other financial products and services to more than 20 million individuals, institutions and financial intermediaries. In this role, Mr. Weiss manages Fidelity Series International Growth Fund, Fidelity Series International Small Cap Fund, Fidelity International Small Cap Opportunities Fund, Fidelity Advisor International Small Cap Opportunities Fund, Fidelity International Growth Fund, and Fidelity Advisor International Growth Fund. Additionally, he co-manages Fidelity Total International Equity Fund and Fidelity Advisor Total International Equity Fund. Prior to assuming his current position in 2007, Mr. Weiss covered the telecommunications, health care, and consumer sectors as an analyst on FMR Co.'s Global Emerging Markets team. Previously, he worked as an analyst/portfolio manager of Select Environment Fund, during which he also covered a wide range of industries within the cyclical sector. Prior to that, Mr. Weiss held various other roles at FMR Co., including equity research analyst covering communications, semiconductors, and networking stocks, during which he also managed Select Networking and Infrastructure. Additionally, he worked as an equity research analyst covering semiconductors and as an associate analyst covering U.S. regional banks. Equity Fund, and Fidelity Flex International Fund. Prior to assuming his current responsibilities, Mr. Montemaggiore co-managed Select Banking, after being sole manager on the fund from 2008 to 2012. He also assumed research analyst coverage responsibilities for large-cap and regional banks in 2008. Previously, Mr. Montemaggiore managed Select Industrial Equipment, after taking on research coverage of industrial and machinery stocks in 2006. He joined Fidelity full time in 2005 as an equity research analyst following the media industry. Before joining Fidelity, Mr. Montemaggiore worked as an investment banking analyst at de Guardiola Advisors, Inc. He also worked at Putnam Lovell Securities, Inc., where he focused on mergers and acquisitions within the financial services industry. He has been in the investments industry since 2000. Mr. Montemaggiore earned his bachelor of science degree in engineering from the University of Pennsylvania and his master of business administration degree from Columbia Business School. Before joining Fidelity in 1997, Mr. Weiss was a summer associate at Goldman Sachs and a legislative affairs intern at the White House. He has been in the investments industry since 1997. Mr. Weiss earned his bachelor of arts degree in government from Harvard University, where he graduated Phi Beta Kappa. Vincent Montemaggiore is a portfolio manager at Fidelity Management & Research Company (FMR Co.), the investment advisor for Fidelity's family of mutual funds. Fidelity Investments is a leading provider of investment management, retirement planning, portfolio guidance, brokerage, benefits outsourcing and other financial products and services to more than 20 million individuals, institutions and financial intermediaries. In this role, Mr. Montemaggiore manages Fidelity Overseas Fund, Fidelity Advisor Overseas Fund, and Fidelity VIP Overseas. Additionally, he co-manages Fidelity International Growth Fund, Fidelity Advisor International Growth Fund, and Fidelity Series International Growth Fund, as well as an international growth fund available exclusively to Canadian investors, a sub-advised institutional international growth portfolio, and the developed market growth sleeves of Fidelity Total International Equity Fund, Fidelity Advisor Total International 8 For definitions, fund risks and other important information, please see the Definitions and Important section of this Q&A.
PERFORMANCE SUMMARY: Quarter ending September 30, 2017 1 3 Annualized 5 10 / LOF 1 Fidelity International Growth Fund Gross Expense Ratio: 0.99% 2 16.42% 7.43% 9.03% 3.76% 1 Life of Fund (LOF) if performance is less than 10 years. Fund inception date: 11/01/2007. 2 This expense ratio is from the prospectus in effect as of the date shown above and generally is based on amounts incurred during that fiscal year. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate; therefore, you may have a gain or loss when you sell your shares. Current performance may be higher or lower than the performance stated. Performance shown is that of the fund's Retail Class shares (if multiclass). You may own another share class of the fund with a different expense structure and, thus, have different returns. To learn more or to obtain the most recent month-end or other share-class performance, visit fidelity.com/performance, institutional.fidelity.com, or 401k.com. Total returns are historical and include change in share value and reinvestment of dividends and capital gains, if any. Cumulative total returns are reported as of the period indicated. Before investing in any mutual fund, please carefully consider the investment objectives, risks, charges, and expenses. For this and other information, call or write Fidelity for a free prospectus or, if available, a summary prospectus. Read it carefully before you invest. Past performance is no guarantee of future results. Views expressed are through the end of the period stated and do not necessarily represent the views of Fidelity. Views are subject to change at any time based upon market or other conditions and Fidelity disclaims any responsibility to update such views. These views may not be relied on as investment advice and, because investment decisions for a Fidelity fund are based on numerous factors, may not be relied on as an indication of trading intent on behalf of any Fidelity fund. The securities mentioned are not necessarily holdings invested in by the portfolio manager(s) or FMR LLC. References to specific company securities should not be construed as recommendations or investment advice. Diversification does not ensure a profit or guarantee against a loss. included on this page is as of the most recent calendar quarter. S&P 500 is a registered service mark of Standard & Poor's Financial Services LLC. Other third-party marks appearing herein are the property of their respective owners. All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. Fidelity Brokerage Services LLC, Member NYSE, SIPC., 900 Salem Street, Smithfield, RI 02917. Fidelity Investments Institutional Services Company, Inc., 500 Salem Street, Smithfield, RI 02917. 2017 FMR LLC. All rights reserved. Not NCUA or NCUSIF insured. May lose value. No credit union guarantee. 706818.7.0