To: Commission File No. S7-26-03
From: David S. Schwartz, Senior Counsel
Office of Disclosure Regulation
Division of Investment Management
Date: March 26, 2004
Re: Disclosure Regarding Market Timing and Selective Disclosure of Portfolio Holdings, Release No.: IC-26287

On March 17, 2004, Paul Cellupica, Assistant Director of the Office of Disclosure Regulation in the Division of Investment Management, and I contacted Stuart Fross at Fidelity by telephone to obtain clarification regarding certain issues raised in Fidelity's February 10, 2004 comment letter on the proposed disclosure regarding market timing and selective disclosure of portfolio holdings. Deb Paige was present with Mr. Fross during our telephone conversation.

In its comment letter, Fidelity requested clarification that analytical performance statistics about a fund's portfolio would not be considered "portfolio information" and be subject to the proposed disclosure requirements. Mr. Fross stated that Fidelity provides portfolio holding information to certain independent data service providers on a monthly or quarterly basis. These data service providers use this information about a fund's portfolio holdings to derive certain statistics, such as beta and relative volatility, and statistics about how certain factors, such as sector selection and currency exposure, affected a portfolio's return. Fidelity typically arranges to have the data service providers make this analytical information available to institutional investors that rely on the information in making investment decisions.

Mr. Fross and Ms. Paige also discussed the request in Fidelity's comment letter that the Commission clarify the proposed requirement that a fund disclose in its prospectus that its policies and procedures with respect to disclosure of portfolio holdings are included in the fund's SAI and on its website, if applicable. Specifically, Mr. Fross and Ms. Paige requested that the Commission clarify that if a fund posts its SAI on its website, it should be able to state in its prospectus that the fund's disclosure of its policies and procedures is in its SAI, which is on the fund's website. Further, Mr. Fross suggested that the Commission clarify whether, if a fund posts its holdings on its website, it must state in its prospectus that it does so.