N-CSR 1 vgp1.htm

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number 811-3329

Variable Insurance Products Fund
(Exact name of registrant as specified in charter)

82 Devonshire St., Boston, Massachusetts 02109
(Address of principal executive offices) (Zip code)

Eric D. Roiter, Secretary

82 Devonshire St.

Boston, Massachusetts 02109
(Name and address of agent for service)

Registrant's telephone number, including area code: 617-563-7000

Date of fiscal year end:	December 31

Date of reporting period:	December 31, 2004

Item 1. Reports to Stockholders

Fidelity® Variable Insurance Products

Asset Manager ^SM Portfolio

Contrafund® Portfolio

Equity-Income Portfolio

Growth Portfolio

High Income Portfolio

Index 500 Portfolio

Overseas Portfolio

Annual Report

December 31, 2004

(2_fidelity_logos) (Registered_Trademark)

Shareholder Expense Example	4	An example of shareholder expenses
Asset Manager Portfolio	8 9 10 11 24	Performance Management's Discussion Investment Summary Investments Financial Statements
Contrafund Portfolio	25 29 30 31 40	Performance Management's Discussion Investment Summary Investments Financial Statements
Equity-Income Portfolio	44 45 46 47 53	Performance Management's Discussion Investment Summary Investments Financial Statements
Growth Portfolio	57 58 59 60 65	Performance Management's Discussion Investment Summary Investments Financial Statements
High Income Portfolio	69 70 71 72 80	Performance Management's Discussion Investment Summary Investments Financial Statements
Index 500 Portfolio	85 86 87 88 96	Performance Management's Discussion Investment Summary Investments Financial Statements
Overseas Portfolio	100 101 102 103 106	Performance Management's Discussion Investment Summary Investments Financial Statements
Notes to Financial Statements	111	Notes to the Financial Statements
Report of Independent Registered Public Accounting Firm	119
Central Investment Portfolio Top Fifty Holdings	124	Top Fifty holdings of each Fidelity Central Investment Portfolio held by certain funds.
Trustees and Officers	126
Distributions	132
Proxy Voting Results	134

To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at www.sec.gov. You may also call 1-800-544-5429 to request a free copy of the proxy voting guidelines.

Fidelity Variable Insurance Products are separate account options which are purchased through a variable insurance contract.

Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.

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 Corp. or an affiliated company.

(Recycle graphic) This report is printed on recycled paper using soy-based inks.

This report and the financial statements contained herein are submitted for the general information of the shareholders of the funds. This report is not authorized for distribution to prospective investors in the funds unless preceded or accompanied by an effective prospectus.

A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC's web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC's Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330. For a complete list of a fund's portfolio holdings, view the most recent quarterly holdings report, semiannual report, or annual report on Fidelity's web site at http://www.advisor.fidelity.com.

NOT FDIC INSURED · MAY LOSE VALUE · NO BANK GUARANTEE

Neither the funds nor Fidelity Distributors Corporation is a bank.

Annual Report

Shareholder Expense Example

As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, including redemption fees, and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (July 1, 2004 to December 31, 2004).

Actual Expenses

The first line of the table below for each class of each fund provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line for a class of the fund under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. An annual index fund fee of $10 that is charged once a year may apply for certain accounts with a value of less than $10,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. The estimate of expenses does not include any fees or other expenses of any variable annuity of variable life insurance product. If they were, the estimate of expenses you paid during the period would be higher, and your ending account value would be lower.

Hypothetical Example for Comparison Purposes

The second line of the table below for each class of each fund provides information about hypothetical account values and hypothetical expenses based on a Class' actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Class' actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. An annual index fund fee of $10 that is charged once a year may apply for certain accounts with a value of less than $10,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. The estimate of expenses does not include any fees or other expenses of any variable annuity of variable life insurance product. If they were, the estimate of expenses you paid during the period would be higher, and your ending account value would be lower.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

	Beginning Account Value July 1, 2004	Ending Account Value December 31, 2004	Expenses Paid During Period* July 1, 2004 to December 31, 2004
Asset Manager
Initial Class
Actual	$ 1,000.00	$ 1,041.40	$ 3.44
Hypothetical ^A	$ 1,000.00	$ 1,021.77	$ 3.40
Service Class
Actual	$ 1,000.00	$ 1,040.90	$ 4.00
Hypothetical ^A	$ 1,000.00	$ 1,021.22	$ 3.96
Service Class 2
Actual	$ 1,000.00	$ 1,039.80	$ 4.82
Hypothetical ^A	$ 1,000.00	$ 1,020.41	$ 4.77
Contrafund
Initial Class
Actual	$ 1,000.00	$ 1,086.10	$ 3.62
Hypothetical ^A	$ 1,000.00	$ 1,021.67	$ 3.51
Service Class
Actual	$ 1,000.00	$ 1,085.50	$ 4.14
Hypothetical ^A	$ 1,000.00	$ 1,021.17	$ 4.01
Service Class 2
Actual	$ 1,000.00	$ 1,084.80	$ 4.93
Hypothetical ^A	$ 1,000.00	$ 1,020.41	$ 4.77
Service Class 2R
Actual	$ 1,000.00	$ 1,084.60	$ 4.93
Hypothetical ^A	$ 1,000.00	$ 1,020.41	$ 4.77
	Beginning Account Value July 1, 2004	Ending Account Value December 31, 2004	Expenses Paid During Period* July 1, 2004 to December 31, 2004
Equity-Income
Initial Class
Actual	$ 1,000.00	$ 1,077.30	$ 3.08
Hypothetical ^A	$ 1,000.00	$ 1,022.17	$ 3.00
Service Class
Actual	$ 1,000.00	$ 1,077.10	$ 3.60
Hypothetical ^A	$ 1,000.00	$ 1,021.67	$ 3.51
Service Class 2
Actual	$ 1,000.00	$ 1,076.40	$ 4.38
Hypothetical ^A	$ 1,000.00	$ 1,020.91	$ 4.27
Service Class 2R
Actual	$ 1,000.00	$ 1,075.70	$ 4.38
Hypothetical ^A	$ 1,000.00	$ 1,020.91	$ 4.27
Growth
Initial Class
Actual	$ 1,000.00	$ 1,018.80	$ 3.55
Hypothetical ^A	$ 1,000.00	$ 1,021.62	$ 3.56
Service Class
Actual	$ 1,000.00	$ 1,018.20	$ 4.06
Hypothetical ^A	$ 1,000.00	$ 1,021.11	$ 4.06
Service Class 2
Actual	$ 1,000.00	$ 1,017.40	$ 4.82
Hypothetical ^A	$ 1,000.00	$ 1,020.36	$ 4.82
Service Class 2R
Actual	$ 1,000.00	$ 1,017.40	$ 4.82
Hypothetical ^A	$ 1,000.00	$ 1,020.36	$ 4.82
High Income
Initial Class
Actual	$ 1,000.00	$ 1,088.60	$ 3.78
Hypothetical ^A	$ 1,000.00	$ 1,021.52	$ 3.66
Service Class
Actual	$ 1,000.00	$ 1,089.10	$ 4.31
Hypothetical ^A	$ 1,000.00	$ 1,021.01	$ 4.17
Service Class 2
Actual	$ 1,000.00	$ 1,088.20	$ 5.14
Hypothetical ^A	$ 1,000.00	$ 1,020.21	$ 4.98
Initial Class R
Actual	$ 1,000.00	$ 1,090.30	$ 3.73
Hypothetical ^A	$ 1,000.00	$ 1,021.57	$ 3.61
Service Class R
Actual	$ 1,000.00	$ 1,089.10	$ 4.25
Hypothetical ^A	$ 1,000.00	$ 1,021.06	$ 4.12
Service Class 2R
Actual	$ 1,000.00	$ 1,088.20	$ 5.04
Hypothetical ^A	$ 1,000.00	$ 1,020.31	$ 4.88
Index 500
Initial Class
Actual	$ 1,000.00	$ 1,070.60	$ 1.46**
Hypothetical ^A	$ 1,000.00	$ 1,023.73	$ 1.42**
Service Class
Actual	$ 1,000.00	$ 1,070.20	$ 1.98**
Hypothetical ^A	$ 1,000.00	$ 1,023.23	$ 1.93**
Service Class 2
Actual	$ 1,000.00	$ 1,069.30	$ 2.76**
Hypothetical ^A	$ 1,000.00	$ 1,022.47	$ 2.69**
	Beginning Account Value July 1, 2004	Ending Account Value December 31, 2004	Expenses Paid During Period* July 1, 2004 to December 31, 2004
Overseas
Initial Class
Actual	$ 1,000.00	$ 1,124.60	$ 4.97
Hypothetical ^A	$ 1,000.00	$ 1,020.46	$ 4.72
Service Class
Actual	$ 1,000.00	$ 1,123.70	$ 5.50
Hypothetical ^A	$ 1,000.00	$ 1,019.96	$ 5.23
Service Class 2
Actual	$ 1,000.00	$ 1,123.40	$ 6.30
Hypothetical ^A	$ 1,000.00	$ 1,019.20	$ 5.99
Initial Class R
Actual	$ 1,000.00	$ 1,124.80	$ 4.97
Hypothetical ^A	$ 1,000.00	$ 1,020.46	$ 4.72
Service Class R
Actual	$ 1,000.00	$ 1,124.50	$ 5.50
Hypothetical ^A	$ 1,000.00	$ 1,019.96	$ 5.23
Service Class 2R
Actual	$ 1,000.00	$ 1,123.40	$ 6.30
Hypothetical ^A	$ 1,000.00	$ 1,019.20	$ 5.99

^A 5% return per year before expenses

* Expenses are equal to each Class' annualized expense ratio (shown in the table below); multiplied by the average account value over the period, multiplied by 184/366 (to reflect the one-half year period).

	Annualized Expense Ratio
Asset Manager
Initial Class	.67%
Service Class	.78%
Service Class 2	.94%
Contrafund
Initial Class	.69%
Service Class	.79%
Service Class 2	.94%
Service Class 2R	.94%
Equity-Income
Initial Class	.59%
Service Class	.69%
Service Class 2	.84%
Service Class 2R	.84%
Growth
Initial Class	.70%
Service Class	.80%
Service Class 2	.95%
Service Class 2R	.95%
High Income
Initial Class	.72%
Service Class	.82%
Service Class 2	.98%
Initial Class R	.71%
Service Class R	.81%
Service Class 2R	.96%
Index 500
Initial Class	.28%**
Service Class	.38%**
Service Class 2	.53%**
	Annualized Expense Ratio
Overseas
Initial Class	.93%
Service Class	1.03%
Service Class 2	1.18%
Initial Class R	.93%
Service Class R	1.03%
Service Class 2R	1.18%

**Under the terms of the VIP Index 500 Portfolio's amended management contract and the VIP Index 500 Portfolio 10 Basis Point Expense Contract effective March 1, 2005, Fidelity Management & Research Company has contractually agreed to pay all operating expenses of the fund and each current class of the fund with certain exceptions. If these contractual arrangements had been in effect during the period, the annualized expense ratio and the expenses paid in the actual and hypothetical examples above would have been as follows:

	Annualized Expense Ratio	Expenses Paid
Initial Class	.10%
Actual		$ .52
Hypothetical^A		$ .51
Service Class	.20%
Actual		$ 1.04
Hypothetical^A		$ 1.02
Service Class 2	.35%
Actual		$ 1.82
Hypothetical^A		$ 1.78

^A 5% return per year before expenses

Annual Report

Fidelity Variable Insurance Products: Asset Manager Portfolio

Performance: The Bottom Line

Average annual total return reflects the change in the value of an investment, assuming reinvestment of a class' dividend income and capital gains (the profits earned upon the sale of securities that have grown in value) and assuming a constant rate of performance each year. During periods of reimbursement by Fidelity, a fund's total return will be greater than it would be had the reimbursement not occurred. Performance numbers are net of all underlying fund operating expenses, but do not include any insurance charges imposed by your insurance company's separate account. If performance information included the effect of these additional charges, the total returns would have been lower. How a fund did yesterday is no guarantee of how it will do tomorrow.

Average Annual Total Returns

Periods ended December 31, 2004	Past 1 year	Past 5 years	Past 10 years
Fidelity VIP: Asset Manager Portfolio - Initial Class	5.47%	0.91%	8.02%
Fidelity VIP: Asset Manager Portfolio - Service Class ^A	5.36%	0.79%	7.91%
Fidelity VIP: Asset Manager Portfolio - Service Class 2 ^B	5.18%	0.62%	7.82%

^A The initial offering of Service Class shares took place on November 3, 1997. Performance for Service Class shares reflects an asset based distribution fee (12b-1 fee) and returns prior to November 3, 1997 are those for Initial Class and do not include the effects of Service Class' 12b-1 fee. Had Service Class shares' 12b-1 fee been reflected, returns prior to November 3, 1997 would have been lower.

^B The initial offering of Service Class 2 shares took place on January 12, 2000. Performance for Service Class 2 shares reflect an asset based distribution fee (12b-1 fee). Returns from November 3, 1997 to January 12, 2000 are those of Service Class which reflect a different 12b-1 fee. Service Class 2 returns prior to November 3, 1997 are those of Initial Class and do not include the effect of a 12b-1 fee. Had Service Class 2's 12b-1 fee been reflected, returns prior to January 12, 2000 would have been lower.

$10,000 Over 10 Years

Let's say hypothetically that $10,000 was invested in Fidelity ® Variable Insurance Products: Asset Manager ^SM Portfolio - Initial Class on December 31, 1994. The chart shows how the value of your investment would have changed, and also shows how the S&P 500 Index performed over the same period.

Annual Report

Fidelity Variable Insurance Products: Asset Manager Portfolio

Management's Discussion of Fund Performance

Comments from Richard Habermann and Ford O'Neil, Co-Managers of Fidelity® Variable Insurance Products: Asset Manager Portfolio

Equity and fixed-income benchmarks finished the year ending December 31, 2004, with positive returns. In the equity markets, small-cap stocks outperformed large-caps for the sixth consecutive year, as the Russell 2000® Index was up 18.33% compared to 10.88% for the larger-cap Standard & Poor's 500^SM Index. Meanwhile, value stocks topped growth stocks: The Russell 3000® Value Index advanced 16.94%, compared to 6.93% for the Russell 3000 Growth Index. Elsewhere the tech-heavy NASDAQ Composite® Index returned 9.15%, thanks primarily to a 14.87% jump in the fourth quarter, and the Dow Jones Industrial Average^SM gained 5.37%. Despite five increases in short-term interest rates, the Lehman Brothers® Aggregate Bond Index rose 4.34% in 2004. While that's roughly half of the benchmark's historical average annual return, it's better than many analysts' expectations at the beginning of the period, given concerns about the potentially high levels of economic growth and subsequent inflation at the start of the year. However, economic expansion was more moderate than anticipated, and the Fed reassured investors that rate tightening would be undertaken at a measured pace.

During the past year, the fund trailed both the Fidelity Asset Manager Composite Index and the Lipper^SM Variable Annuity Flexible Portfolio Funds Average, which returned 7.33% and 8.25%, respectively. Disappointing stock selection was simply too much to overcome even in the face of favorable asset allocation and solid results within the fixed-income subportfolio. In an environment that favored riskier assets, the fund was rewarded relative to the index for overweighting stocks and high-yield bonds, both of which outperformed investment-grade debt. Unfortunately, our average peer tends to be even heavier in equities. The fund's domestic equity investments trailed the S&P 500® by more than four percentage points, largely due to one major holding in media - radio broadcaster Clear Channel Communications - that stumbled badly. Unfavorable stock selection in financials and health care also hurt, led by insurance giant American International Group and large-cap pharmaceutical company Pfizer, respectively. Conversely, underweighting weak technology stocks helped, as did overweighting retailers Home Depot and pharmacy chain CVS, and energy holdings such as Diamond Offshore Drilling. In fixed income, our high-yield and investment-grade holdings easily beat the Lehman Brothers Aggregate Bond Index. The strategic cash portion of the fund topped its benchmark as well, though overweighting it curbed the fund's gains in a rising bond market.

The views expressed in this statement reflect those of the portfolio managers only through the end of the period of the report as stated on the cover and do not necessarily represent the views of Fidelity or any other person in the Fidelity organization. Any such 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.

Annual Report

Fidelity Variable Insurance Products: Asset Manager Portfolio

Investment Summary

Top Five Stocks as of December 31, 2004
	% of fund's net assets
Home Depot, Inc.	2.6
American International Group, Inc.	2.6
Cardinal Health, Inc.	2.5
Microsoft Corp.	2.4
Fannie Mae	2.1
	12.2
Top Five Bond Issuers as of December 31, 2004
(with maturities greater than one year)	% of fund's net assets
Fannie Mae	8.4
U.S. Treasury Obligations	5.5
Freddie Mac	1.1
Government National Mortgage Association	0.5
Thirteen Affiliates of General Growth Properties, Inc.	0.5
	16.0

Asset Allocation as of December 31, 2004
% of fund's net assets *
	Stock Class and Equity Futures	55.4%
	Bond Class	28.5%
	Short-Term Class	16.1%

* Foreign
investments 7.6%

Asset allocations in the pie chart reflect the categorization of assets as defined in the fund's prospectus in effect of the time period indicated above. Financial Statement categorizations conform to accounting standards and will differ from the pie chart. Percentages are adjusted for the effect of futures contracts and swap contracts, if applicable.

The information in the above tables is based on the combined investments of the fund and its pro-rata share of investments of Fidelity's fixed-income central funds.

Annual Report

Fidelity Variable Insurance Products: Asset Manager Portfolio

Investments December 31, 2004

Showing Percentage of Net Assets

Common Stocks - 51.0%
	Shares		Value (Note 1)
CONSUMER DISCRETIONARY - 6.1%
Auto Components - 0.1%
Aisin Seiki Co. Ltd.	22,900		$ 580,157
Bridgestone Corp.	29,000		577,565
Michelin SA (Compagnie Generale des Etablissements) Series B	13,700		877,014
NOK Corp.	10,200		319,652
Sanden Corp.	34,000		210,446
Stanley Electric Co. Ltd.	22,900		392,584
Sumitomo Rubber Industries Ltd.	38,000		355,775
			3,313,193
Automobiles - 0.2%
Honda Motor Co. Ltd.	12,400		646,288
Hyundai Motor Co.	11,430		612,795
Kia Motors Corp.	24,170		254,495
Renault SA	7,600		634,567
Toyota Motor Corp.	49,300		2,018,096
			4,166,241
Hotels, Restaurants & Leisure - 0.3%
H.I.S. Co. Ltd.	25,200		490,567
McDonald's Corp.	173,200		5,552,792
William Hill PLC	105,100		1,137,544
			7,180,903
Household Durables - 0.1%
Casio Computer Co. Ltd.	17,000		262,394
HTL International Holdings Ltd.	355,000		289,290
Koninklijke Philips Electronics NV (NY Shares)	15,800		418,700
LG Electronics, Inc.	3,380		209,291
Matsushita Electric Industrial Co. Ltd.	16,000		256,800
Merry Electronics Co. Ltd.	109,322		261,355
Sumitomo Forestry Co. Ltd.	36,000		361,652
Techtronic Industries Co. Ltd.	371,500		810,123
			2,869,605
Leisure Equipment & Products - 0.0%
Aruze Corp.	2,000		50,962
Fuji Photo Film Co. Ltd.	15,800		584,284
Mars Engineering Corp.	6,200		209,431
Sega Sammy Holdings, Inc. (a)	6,000		329,786
			1,174,463
Media - 2.4%
Clear Channel Communications, Inc.	1,567,168		52,484,456
Dow Jones & Co., Inc.	18,300		787,998
ITV PLC	348,171		703,236
Kadokawa Shoten Publishing Co. Ltd.	3,400		141,072
Macquarie Communications Infrastructure Group	74,400		321,322
Maiden Group PLC	31,600		137,961
Modern Times Group AB (MTG) (B Shares) (a)	10,850		295,502
News Corp.:
Class A	486,800		9,083,688

	Shares		Value (Note 1)
Class B unit	57		$ 1,094
NRJ Group	6,920		151,605
PT Multimedia SGPS SA	11,100		278,417
Television Broadcasts Ltd.	44,000		204,354
Time Warner, Inc. (a)	207,700		4,037,688
			68,628,393
Multiline Retail - 0.0%
Don Quijote Co. Ltd.	4,300		219,555
Next PLC	11,800		373,639
Ryohin Keikaku Co. Ltd.	8,000		402,226
			995,420
Specialty Retail - 2.8%
Bookoff Corp.	8,000		155,736
Esprit Holdings Ltd.	125,000		755,841
Fast Retailing Co. Ltd.	2,300		175,144
Hikari Tsushin, Inc.	7,700		590,862
Home Depot, Inc.	1,689,500		72,209,230
JB Hi-Fi Ltd.	27,221		82,635
Nishimatsuya Chain Co. Ltd.	5,000		189,398
Pertama Holdings Ltd.	568,000		97,445
Ross Stores, Inc.	28,000		808,360
Staples, Inc.	29,600		997,816
TJX Companies, Inc.	101,300		2,545,669
USS Co. Ltd.	6,290		528,107
Wyevale Garden Centres PLC	35,200		292,832
			79,429,075
Textiles, Apparel & Luxury Goods - 0.2%
Adidas-Salomon AG	3,100		499,380
Billabong International Ltd.	37,700		337,735
Bulgari Spa	136,100		1,678,254
Compagnie Financiere Richemont unit	26,937		894,787
Li Ning Co. Ltd.	272,000		136,476
Ted Baker PLC	90,600		839,772
			4,386,404
TOTAL CONSUMER DISCRETIONARY			172,143,697
CONSUMER STAPLES - 3.8%
Beverages - 0.3%
Asahi Breweries Ltd.	14,200		175,923
C&C Group PLC	112,300		450,928
Fosters Group Ltd.	85,500		387,323
PepsiCo, Inc.	119,300		6,227,460
Pernod-Ricard	4,900		749,128
			7,990,762
Food & Staples Retailing - 2.1%
CVS Corp.	678,000		30,557,460
Safeway, Inc. (a)	572,100		11,293,254
Wal-Mart Stores, Inc.	335,000		17,694,700
Wumart Stores, Inc. (H Shares) (a)	26,000		41,812
			59,587,226
Common Stocks - continued
	Shares		Value (Note 1)
CONSUMER STAPLES - continued
Food Products - 0.0%
People's Food Holdings Ltd.	276,000		$ 253,661
Pulmuone Co. Ltd.	4,200		210,974
			464,635
Household Products - 0.2%
Colgate-Palmolive Co.	58,800		3,008,208
Kimberly-Clark Corp.	6,400		421,184
Procter & Gamble Co.	39,100		2,153,628
			5,583,020
Personal Products - 0.5%
Alberto-Culver Co.	287,650		13,971,161
Estee Lauder Companies, Inc. Class A	23,400		1,071,018
Hengan International Group Co. Ltd.	58,000		38,056
			15,080,235
Tobacco - 0.7%
Altria Group, Inc.	314,900		19,240,390
TOTAL CONSUMER STAPLES			107,946,268
ENERGY - 2.4%
Energy Equipment & Services - 1.5%
Diamond Offshore Drilling, Inc. (d)	304,800		12,207,240
ENSCO International, Inc.	214,900		6,820,926
GlobalSantaFe Corp.	308,600		10,217,746
Nabors Industries Ltd. (a)	31,000		1,589,990
Transocean, Inc. (a)	289,200		12,259,188
			43,095,090
Oil & Gas - 0.9%
BP PLC sponsored ADR	54,900		3,206,160
ChevronTexaco Corp.	37,700		1,979,627
China Petroleum & Chemical Corp. (H Shares)	572,000		234,463
ConocoPhillips	116,100		10,080,963
Cosmo Oil Co. Ltd.	33,000		97,618
ENI Spa	64,000		1,610,752
Exxon Mobil Corp.	39,900		2,045,274
GS Holdings Corp. (a)	3,510		75,951
Nippon Mining Holdings, Inc.	51,500		242,341
Royal Dutch Petroleum Co. (Hague Registry)	31,900		1,830,422
Shell Transport & Trading Co. PLC ADR	7,700		395,780
SK Corp.	6,040		331,990
Total SA sponsored ADR	24,000		2,636,160
			24,767,501
TOTAL ENERGY			67,862,591
FINANCIALS - 13.4%
Capital Markets - 1.8%
Credit Suisse Group (Reg.)	25,579		1,079,178
DAB Bank AG (a)	67,500		503,619

	Shares		Value (Note 1)
Goldman Sachs Group, Inc.	110,600		$ 11,506,824
Hyundai Securities Co. Ltd. (a)	36,650		175,426
JAFCO Co. Ltd.	4,100		278,590
Julius Baer Holding AG (Bearer)	4,138		1,242,907
Lehman Brothers Holdings, Inc.	44,100		3,857,868
Macquarie Bank Ltd.	10,200		371,092
Merrill Lynch & Co., Inc.	255,600		15,277,212
Mitsubishi Securities Co. Ltd.	24,000		262,892
Morgan Stanley	243,000		13,491,360
Nikko Cordial Corp.	47,000		249,156
UBS AG (NY Shares)	16,100		1,349,824
			49,645,948
Commercial Banks - 2.5%
Banca Intesa Spa	175,020		840,476
Banco Bilbao Vizcaya Argentaria SA	76,300		1,353,562
Banco Santander Central Hispano SA	64,100		792,917
Bank of America Corp.	802,610		37,714,644
BNP Paribas SA	12,400		896,571
Capitalia Spa	89,500		409,277
Chinatrust Financial Holding Co.	194,967		232,439
DBS Group Holdings Ltd.	32,000		315,667
Hana Bank	6,100		152,029
HSBC Holdings PLC sponsored ADR	23,300		1,983,762
Jeonbuk Bank	20,590		87,514
Kookmin Bank (a)	8,040		314,548
Mitsui Trust Holdings, Inc.	45,000		449,868
Mizuho Financial Group, Inc.	78		392,932
Nishi-Nippon City Bank Ltd.	20,000		77,126
North Fork Bancorp, Inc., New York	74,439		2,147,565
Royal Bank of Scotland Group PLC	25,500		857,355
Shinhan Financial Group Co. Ltd.	18,240		412,303
Sumitomo Mitsui Financial Group, Inc.	89		647,320
Synovus Financial Corp.	146,900		4,198,402
Taishin Financial Holdings Co. Ltd.	159,281		149,310
UFJ Holdings, Inc. (a)	87		527,453
Wachovia Corp.	245,574		12,917,181
Wells Fargo & Co.	65,900		4,095,685
			71,965,906
Consumer Finance - 0.3%
MBNA Corp.	263,200		7,419,608
Nippon Shinpan Co. Ltd.	64,000		276,794
Nissin Co. Ltd.	31,100		78,334
OMC Card, Inc. (a)	17,000		212,106
ORIX Corp.	4,200		570,770
SFCG Co. Ltd.	2,490		629,610
			9,187,222
Diversified Financial Services - 1.5%
Citigroup, Inc.	613,500		29,558,430
Deutsche Boerse AG	25,194		1,513,354
Fortis	30,500		841,977
Common Stocks - continued
	Shares		Value (Note 1)
FINANCIALS - continued
Diversified Financial Services - continued
ING Groep NV (Certificaten Van Aandelen)	36,000		$ 1,089,000
J.P. Morgan Chase & Co.	259,128		10,108,583
			43,111,344
Insurance - 4.5%
ACE Ltd.	106,000		4,531,500
AFLAC, Inc.	30,200		1,203,168
AMBAC Financial Group, Inc.	90,500		7,432,765
American International Group, Inc.	1,095,900		71,967,753
Amlin PLC	362,300		983,810
AMP Ltd.	36,300		206,192
Baloise Holdings AG (Reg.)	12,521		576,903
Chaucer Holdings PLC	293,200		275,706
Hartford Financial Services Group, Inc.	247,900		17,181,949
MBIA, Inc.	92,700		5,866,056
MetLife, Inc.	183,600		7,437,636
Millea Holdings, Inc.	42		623,255
PartnerRe Ltd.	39,300		2,434,242
Ping An Insurance Co. Ltd.	125,000		212,279
Promina Group Ltd.	85,837		362,658
Prudential Financial, Inc.	68,500		3,764,760
QBE Insurance Group Ltd.	29,432		353,474
Skandia Foersaekrings AB	129,800		646,480
T&D Holdings, Inc.	6,400		306,160
			126,366,746
Real Estate - 0.1%
CapitaLand Ltd.	297,000		387,605
China Overseas Land & Investment Ltd.	488,000		120,543
Henderson Land Development Co. Ltd.	36,000		187,114
Shun Tak Holdings Ltd.	386,000		424,596
Tokyu Land Corp. (d)	55,000		229,815
Wharf Holdings Ltd.	65,000		227,460
			1,577,133
Thrifts & Mortgage Finance - 2.7%
Fannie Mae	828,200		58,976,122
MGIC Investment Corp.	121,300		8,358,783
New York Community Bancorp, Inc.	186,000		3,826,020
Sovereign Bancorp, Inc.	1,700		38,335
Washington Mutual, Inc.	122,300		5,170,844
			76,370,104
TOTAL FINANCIALS			378,224,403
HEALTH CARE - 8.5%
Biotechnology - 0.0%
Actelion Ltd. (Reg.) (a)	6,741		690,990
CSL Ltd.	21,473		491,414

	Shares		Value (Note 1)
Global Bio-Chem Technology Group Co. Ltd.	424,000		$ 278,201
Global Bio-Chem Technology Group Co. Ltd. warrants 5/31/07 (a)	25,250		1,202
			1,461,807
Health Care Equipment & Supplies - 0.3%
Axis Shield PLC (a)	83,100		389,114
Baxter International, Inc.	138,100		4,769,974
Coloplast AS Series B	9,800		537,136
Corin Group PLC	53,400		319,217
Medtronic, Inc.	38,700		1,922,229
Phonak Holding AG	23,141		761,585
ResMed, Inc. CHESS Depositary Interests (a)	22,900		115,923
Terumo Corp.	8,800		237,118
Thermo Electron Corp. (a)	2,200		66,418
			9,118,714
Health Care Providers & Services - 2.7%
Cardinal Health, Inc.	1,210,500		70,390,575
DCA Group Ltd.	119,415		336,349
Henry Schein, Inc. (a)	27,057		1,884,249
Ramsay Health Care Ltd.	28,200		157,093
Service Corp. International (SCI) (a)	99,729		742,981
Sonic Healthcare Ltd.	24,400		232,523
UnitedHealth Group, Inc.	15,800		1,390,874
			75,134,644
Pharmaceuticals - 5.5%
Barr Pharmaceuticals, Inc. (a)	20,900		951,786
Chugai Pharmaceutical Co. Ltd.	18,500		305,955
GlaxoSmithKline PLC sponsored ADR	25,100		1,189,489
Johnson & Johnson	374,400		23,744,448
Merck & Co., Inc.	215,100		6,913,314
Novo Nordisk AS Series B	11,400		621,712
Pfizer, Inc.	2,020,700		54,336,623
Roche Holding AG (participation certificate)	13,174		1,505,336
Sanofi-Aventis	7,500		600,750
Schering-Plough Corp.	353,300		7,376,904
Shire Pharmaceuticals Group PLC	36,400		387,660
Takeda Pharamaceutical Co. Ltd.	10,100		508,796
Tong Ren Tang Technologies Co. Ltd. (H Shares)	65,000		142,581
Wyeth	1,301,100		55,413,849
Yamanouchi Pharmaceutical Co. Ltd.	17,400		677,790
			154,676,993
TOTAL HEALTH CARE			240,392,158
INDUSTRIALS - 4.2%
Aerospace & Defense - 0.5%
BAE Systems PLC	160,900		711,727
Lockheed Martin Corp.	78,100		4,338,455
Common Stocks - continued
	Shares		Value (Note 1)
INDUSTRIALS - continued
Aerospace & Defense - continued
Northrop Grumman Corp.	59,000		$ 3,207,240
United Technologies Corp.	64,800		6,697,080
			14,954,502
Air Freight & Logistics - 0.1%
Ryder System, Inc.	16,100		769,097
Yamato Transport Co. Ltd.	34,000		504,540
			1,273,637
Commercial Services & Supplies - 0.3%
ABC Learning Centres Ltd.	61,700		265,990
Accord Customer Care Solutions Ltd. (a)	530,000		277,648
Aramark Corp. Class B	68,100		1,805,331
ChoicePoint, Inc. (a)	91,233		4,195,806
Diamond Lease Co. Ltd.	5,900		230,401
Downer EDI Ltd.	96,900		358,603
Fullcast Co. Ltd.	94		268,886
Riso Kyoiku Co. Ltd.	309		146,310
Societe Generale de Surveillance Holding SA (SGS) (Reg.)	500		349,511
Sumisho Lease Co. Ltd.	3,900		159,153
			8,057,639
Construction & Engineering - 0.1%
Bilfinger & Berger Bau AG	13,200		541,670
Commuture Corp.	9,000		83,472
Hyundai Engineering & Construction Co. Ltd. (a)	8,000		120,170
Paul Y-ITC Construction Holdings Ltd.	1,674,000		424,272
United Group Ltd.	78,400		386,443
			1,556,027
Electrical Equipment - 0.0%
ABB Ltd. (Reg.) (a)	91,039		507,348
Kumho Electric Co. Ltd.	11,311		345,274
Seoul Semiconductor Co. Ltd.	9,059		146,141
Sumitomo Electric Industries Ltd.	17,000		185,053
			1,183,816
Industrial Conglomerates - 2.6%
General Electric Co.	1,326,200		48,406,300
Hutchison Whampoa Ltd.	34,000		318,225
Hutchison Whampoa Ltd. ADR	4,600		214,820
Keppel Corp. Ltd.	40,000		210,771
LG Corp.	6,519		106,425
Siemens AG:
(Reg.)	6,900		584,223
sponsored ADR	1,700		143,939
Tyco International Ltd.	622,400		22,244,576
			72,229,279
Machinery - 0.4%
Bradken Ltd.	64,800		139,931
Hyflux Ltd.	64,000		116,463
Hyundai Mipo Dockyard Co. Ltd. (a)	7,020		237,345

	Shares		Value (Note 1)
Ingersoll-Rand Co. Ltd. Class A	131,300		$ 10,543,390
Invensys PLC (a)	1,705,800		507,395
Koyo Seiko Co. Ltd.	15,000		211,169
			11,755,693
Marine - 0.0%
Alexander & Baldwin, Inc.	7,863		333,548
Hanjin Shipping Co. Ltd.	8,830		204,714
			538,262
Road & Rail - 0.2%
ComfortDelgro Corp. Ltd.	212,000		201,336
CSX Corp.	42,700		1,711,416
East Japan Railway Co.	115		639,949
Hamakyorex Co. Ltd.	7,400		334,492
Keio Electric Railway Co. Ltd.	37,000		217,095
Union Pacific Corp.	24,200		1,627,450
			4,731,738
Trading Companies & Distributors - 0.0%
Mitsui & Co. Ltd.	31,000		278,131
Transportation Infrastructure - 0.0%
Adsteam Marine Ltd.	106,700		132,737
ConnectEast Group	287,133		152,764
Cosco Pacific Ltd.	152,000		314,842
Macquarie Airports Fund	164,000		402,905
Macquarie Infrastructure Group	50,900		135,402
			1,138,650
TOTAL INDUSTRIALS			117,697,374
INFORMATION TECHNOLOGY - 7.7%
Communications Equipment - 1.4%
Alcatel SA (RFD) (a)	22,900		357,927
Cisco Systems, Inc. (a)	1,219,300		23,532,490
Comverse Technology, Inc. (a)	130,700		3,195,615
Motorola, Inc.	539,400		9,277,680
TANDBERG Television ASA (a)	306,600		2,665,757
Telefonaktiebolaget LM Ericsson (B Shares) (a)	152,800		481,167
			39,510,636
Computers & Peripherals - 1.2%
ABIT Computer Corp.	184,000		0
Dell, Inc. (a)	471,900		19,885,866
Diebold, Inc.	41,200		2,296,076
Fujitsu Ltd.	49,000		319,076
Hewlett-Packard Co.	456,200		9,566,514
NEC Corp.	13,000		80,845
Solomon Systech Ltd.	746,000		184,273
Sun Microsystems, Inc. (a)	172,200		926,436
			33,259,086
Electronic Equipment & Instruments - 0.5%
Flextronics International Ltd. (a)	226,100		3,124,702
Hon Hai Precision Industries Co. Ltd.	13,049		60,340
Hoya Corp.	4,900		553,480
Common Stocks - continued
	Shares		Value (Note 1)
INFORMATION TECHNOLOGY - continued
Electronic Equipment & Instruments - continued
Interflex Co. Ltd.	9,876		$ 165,522
Jabil Circuit, Inc. (a)	122,500		3,133,550
Jahwa Electronics Co. Ltd.	10,310		106,566
Kingboard Chemical Holdings Ltd.	60,000		126,981
Kingboard Chemical Holdings Ltd. warrants 12/31/06 (a)	6,000		3,184
Nidec Corp.	800		97,550
Nippon Chemi-con Corp.	49,000		268,369
Nippon Electric Glass Co. Ltd.	23,000		588,304
Sanmina-SCI Corp. (a)	239,000		2,024,330
Solectron Corp. (a)	817,100		4,355,143
			14,608,021
Internet Software & Services - 0.0%
Easynet Group PLC (a)	146,200		293,191
Softbank Corp.	7,700		375,115
			668,306
IT Services - 0.4%
Affiliated Computer Services, Inc. Class A (a)	75,100		4,520,269
First Data Corp.	153,800		6,542,652
Net One Systems Co. Ltd.	27		112,555
TIS, Inc.	2,500		109,587
			11,285,063
Office Electronics - 0.1%
Canon, Inc.	12,900		699,954
Konica Minolta Holdings, Inc.	38,500		511,178
Ricoh Co. Ltd.	27,000		521,127
			1,732,259
Semiconductors & Semiconductor Equipment - 1.4%
Analog Devices, Inc.	21,500		793,780
Applied Materials, Inc. (a)	224,100		3,832,110
Freescale Semiconductor, Inc. Class B	60,165		1,104,629
Intel Corp.	883,400		20,662,726
KLA-Tencor Corp. (a)	59,000		2,748,220
Lam Research Corp. (a)	78,200		2,260,762
Linear Technology Corp.	21,100		817,836
Novellus Systems, Inc. (a)	49,300		1,374,977
Taiwan Semiconductor Manufacturing Co. Ltd. sponsored ADR	283,619		2,407,925
United Microelectronics Corp. sponsored ADR	523,231		1,847,005
Xilinx, Inc.	14,400		426,960
			38,276,930
Software - 2.7%
BEA Systems, Inc. (a)	380,300		3,369,458
Computer Associates International, Inc.	6,989		217,078
F-Secure Oyj (a)	167,350		410,904
Hitachi Software Engineerng Co. Ltd.	1,100		25,129
Intelligent Wave, Inc.	37		70,077
Microsoft Corp.	2,510,792		67,063,254

	Shares		Value (Note 1)
NCsoft Corp. (a)	2,260		$ 182,948
NDS Group PLC sponsored ADR (a)	22,700		773,593
Nintendo Co. Ltd.	1,700		213,600
Oracle Corp. Japan	2,000		103,681
SAP AG	3,600		636,624
VERITAS Software Corp. (a)	130,367		3,721,978
			76,788,324
TOTAL INFORMATION TECHNOLOGY			216,128,625
MATERIALS - 0.6%
Chemicals - 0.3%
Akzo Nobel NV sponsored ADR	12,600		535,374
BASF AG	11,900		857,038
Bayer AG	28,200		958,236
Imperial Chemical Industries PLC	117,300		542,502
JSR Corp.	8,500		186,298
Kaneka Corp.	25,000		283,120
Kemira GrowHow Oyj	111,800		853,859
Nitto Denko Corp.	10,100		554,154
Praxair, Inc.	40,800		1,801,320
Rhodia SA (a)(d)	170,100		403,811
Syngenta AG (Switzerland)	4,254		450,992
Taiwan Fertilizer Co. Ltd.	119,000		129,893
Teijin Ltd.	77,000		334,521
			7,891,118
Containers & Packaging - 0.0%
Amcor Ltd.	21,500		123,639
Fuji Seal International, Inc.	5,800		251,977
			375,616
Metals & Mining - 0.2%
Alcan, Inc.	99,700		4,885,300
BHP Billiton Ltd.	80,800		970,408
BHP Billiton PLC	60,500		708,806
Hitachi Metals Ltd.	9,000		49,116
Newcrest Mining Ltd.	30,400		415,048
			7,028,678
Paper & Forest Products - 0.1%
Bowater, Inc.	27,700		1,217,969
Carter Holt Harvey Ltd.	62,175		92,415
International Paper Co.	21,600		907,200
PaperlinX Ltd.	67,100		247,795
Yuen Foong Yu Paper Manufacturing Co.	263,000		144,778
			2,610,157
TOTAL MATERIALS			17,905,569
TELECOMMUNICATION SERVICES - 3.8%
Diversified Telecommunication Services - 3.5%
Belgacom SA	17,500		754,920
BellSouth Corp.	392,400		10,904,796
BT Group PLC	300,600		1,188,272
Common Stocks - continued
	Shares		Value (Note 1)
TELECOMMUNICATION SERVICES - continued
Diversified Telecommunication Services - continued
Completel Europe NV (a)	13,226		$ 507,751
Deutsche Telekom AG (Reg.) (a)	34,200		775,656
e.Biscom Spa (a)	29,900		1,722,213
France Telecom SA	21,052		696,400
Qwest Communications International, Inc. (a)	1,933,400		8,584,296
SBC Communications, Inc.	2,201,400		56,730,078
TDC AS	21,700		917,261
Telefonica SA sponsored ADR	27,200		1,536,800
Verizon Communications, Inc.	352,800		14,291,928
			98,610,371
Wireless Telecommunication Services - 0.3%
Far EasTone Telecommunications Co. Ltd.	282,250		341,825
Millicom International Cellular SA unit (a)	62,100		1,387,621
Nextel Communications, Inc. Class A (a)	160,900		4,827,000
Vodafone Group PLC	587,800		1,609,396
			8,165,842
TOTAL TELECOMMUNICATION SERVICES			106,776,213
UTILITIES - 0.5%
Electric Utilities - 0.5%
Enel Spa	42,800		419,834
Entergy Corp.	49,400		3,338,946
FirstEnergy Corp.	106,300		4,199,913
Fortum Oyj	27,600		509,943
PG&E Corp. (a)	159,200		5,298,176
			13,766,812
Gas Utilities - 0.0%
Hong Kong & China Gas Co. Ltd.	109,000		225,073
Multi-Utilities & Unregulated Power - 0.0%
RWE AG	5,600		309,185
TOTAL UTILITIES			14,301,070
TOTAL COMMON STOCKS (Cost $1,248,448,050)		1,439,377,968
Preferred Stocks - 0.1%

Convertible Preferred Stocks - 0.1%
MATERIALS - 0.1%
Paper & Forest Products - 0.1%
International Paper Capital Trust 2.625%	32,500		1,628,900

	Shares		Value (Note 1)
TELECOMMUNICATION SERVICES - 0.0%
Diversified Telecommunication Services - 0.0%
Cincinnati Bell, Inc. Series B, 6.75%	7,700		$ 313,775
TOTAL CONVERTIBLE PREFERRED STOCKS			1,942,675
Nonconvertible Preferred Stocks - 0.0%
CONSUMER DISCRETIONARY - 0.0%
Automobiles - 0.0%
Porsche AG (non-vtg.)	510		324,819
Household Durables - 0.0%
LG Electronics, Inc.	2,930		101,893
TOTAL CONSUMER DISCRETIONARY			426,712
HEALTH CARE - 0.0%
Health Care Equipment & Supplies - 0.0%
Fresenius AG	900		84,034
TOTAL NONCONVERTIBLE PREFERRED STOCKS			510,746
TOTAL PREFERRED STOCKS (Cost $2,331,352)		2,453,421

Corporate Bonds - 4.7%
	Principal Amount
Convertible Bonds - 0.4%
CONSUMER DISCRETIONARY - 0.1%
Specialty Retail - 0.1%
Gap, Inc. 5.75% 3/15/09 (e)	$ 1,214,000		1,613,649
INDUSTRIALS - 0.3%
Industrial Conglomerates - 0.3%
Tyco International Group SA yankee 3.125% 1/15/23	4,620,000		7,771,764
INFORMATION TECHNOLOGY - 0.0%
Communications Equipment - 0.0%
CIENA Corp. 3.75% 2/1/08	660,000		585,750
TOTAL CONVERTIBLE BONDS			9,971,163
Nonconvertible Bonds - 4.3%
CONSUMER DISCRETIONARY - 0.5%
Auto Components - 0.1%
DaimlerChrysler NA Holding Corp. 7.2% 9/1/09	1,250,000		1,391,270
Automobiles - 0.2%
Ford Motor Co.:
6.625% 10/1/28	300,000		279,824
7.45% 7/16/31	1,440,000		1,448,263
Corporate Bonds - continued
	Principal Amount		Value (Note 1)
Nonconvertible Bonds - continued
CONSUMER DISCRETIONARY - continued
Automobiles - continued
General Motors Corp.:
8.25% 7/15/23	$ 2,320,000		$ 2,416,679
8.375% 7/15/33	1,010,000		1,046,444
			5,191,210
Media - 0.2%
AOL Time Warner, Inc.:
7.625% 4/15/31	500,000		604,881
7.7% 5/1/32	1,500,000		1,834,677
Cox Communications, Inc. 7.125% 10/1/12	820,000		919,107
Liberty Media Corp. 8.25% 2/1/30	1,205,000		1,370,159
News America, Inc. 6.2% 12/15/34 (e)	1,750,000		1,773,655
			6,502,479
TOTAL CONSUMER DISCRETIONARY			13,084,959
CONSUMER STAPLES - 0.0%
Tobacco - 0.0%
Altria Group, Inc. 7% 11/4/13	730,000		790,991
ENERGY - 0.5%
Energy Equipment & Services - 0.0%
Petronas Capital Ltd. 7% 5/22/12 (e)	1,365,000		1,563,647
Oil & Gas - 0.5%
Amerada Hess Corp.:
6.65% 8/15/11	180,000		197,942
7.125% 3/15/33	460,000		505,799
7.375% 10/1/09	405,000		452,483
Empresa Nacional de Petroleo 6.75% 11/15/12 (e)	940,000		1,045,322
EnCana Holdings Finance Corp. 5.8% 5/1/14	525,000		559,696
Enterprise Products Operating LP:
4.625% 10/15/09 (e)	270,000		269,577
5.6% 10/15/14 (e)	190,000		191,685
Kinder Morgan Energy Partners LP 7.125% 3/15/12	790,000		903,145
Pemex Project Funding Master Trust:
6.125% 8/15/08	2,770,000		2,936,200
7.875% 2/1/09 (h)	3,000,000		3,370,500
Ras Laffan Liquid Natural Gas Co. Ltd. yankee 8.294% 3/15/14 (e)	1,680,000		1,985,066

	Principal Amount		Value (Note 1)
Williams Companies, Inc.:
7.125% 9/1/11	$ 160,000		$ 174,800
7.5% 1/15/31	635,000		657,225
			13,249,440
TOTAL ENERGY			14,813,087
FINANCIALS - 1.6%
Capital Markets - 0.4%
Goldman Sachs Group, Inc. 6.6% 1/15/12	4,075,000		4,547,859
Merrill Lynch & Co., Inc.:
4.125% 1/15/09	2,500,000		2,513,768
5% 1/15/15	735,000		732,120
Morgan Stanley:
4.75% 4/1/14	2,263,000		2,205,085
6.6% 4/1/12	1,750,000		1,951,805
			11,950,637
Commercial Banks - 0.2%
Bank of America Corp.:
6.25% 4/15/12	620,000		684,730
7.4% 1/15/11	1,165,000		1,349,510
Fleet Financial Group, Inc. 7.125% 4/15/06	1,190,000		1,245,448
Korea Development Bank 3.875% 3/2/09	2,000,000		1,974,072
Wachovia Corp. 4.875% 2/15/14	580,000		578,073
Wells Fargo & Co. 4.2% 1/15/10	335,000		336,361
			6,168,194
Consumer Finance - 0.3%
Capital One Bank 4.875% 5/15/08	775,000		795,939
Ford Motor Credit Co. 7.875% 6/15/10	1,000,000		1,101,760
General Motors Acceptance Corp. 6.875% 9/15/11	1,240,000		1,270,743
Household Finance Corp. 4.125% 11/16/09	1,300,000		1,293,010
Household International, Inc. 8.875% 2/15/08	1,225,000		1,296,764
MBNA America Bank NA 6.625% 6/15/12	1,565,000		1,725,979
MBNA Corp. 7.5% 3/15/12	535,000		618,084
			8,102,279
Diversified Financial Services - 0.3%
Hutchison Whampoa International 03/13 Ltd. 6.5% 2/13/13 (e)	390,000		420,301
Hutchison Whampoa International 03/33 Ltd.:
6.25% 1/24/14 (e)	800,000		842,481
7.45% 11/24/33 (e)	600,000		665,033
J.P. Morgan Chase & Co. 6.75% 2/1/11	4,605,000		5,173,289
			7,101,104
Corporate Bonds - continued
	Principal Amount		Value (Note 1)
Nonconvertible Bonds - continued
FINANCIALS - continued
Insurance - 0.0%
Principal Life Global Funding I 6.25% 2/15/12 (e)	$ 850,000		$ 929,145
Real Estate - 0.2%
EOP Operating LP 4.65% 10/1/10	3,340,000		3,355,264
Regency Centers LP 6.75% 1/15/12	1,990,000		2,220,428
Simon Property Group LP 5.625% 8/15/14 (e)	1,325,000		1,372,182
			6,947,874
Thrifts & Mortgage Finance - 0.2%
Countrywide Home Loans, Inc. 4% 3/22/11	1,630,000		1,584,784
Independence Community Bank Corp. 3.75% 4/1/14 (h)	630,000		607,275
Washington Mutual, Inc.:
4.375% 1/15/08	770,000		782,007
4.625% 4/1/14	1,255,000		1,199,847
			4,173,913
TOTAL FINANCIALS			45,373,146
INDUSTRIALS - 0.1%
Aerospace & Defense - 0.1%
Bombardier, Inc.:
6.3% 5/1/14 (e)	1,030,000		893,525
7.45% 5/1/34 (e)	420,000		358,050
Raytheon Co. 8.3% 3/1/10	1,450,000		1,718,240
			2,969,815
Airlines - 0.0%
Delta Air Lines, Inc. pass thru trust certificates 7.57% 11/18/10	605,000		596,775
TOTAL INDUSTRIALS			3,566,590
MATERIALS - 0.1%
Chemicals - 0.1%
Lubrizol Corp.:
4.625% 10/1/09	495,000		494,236
5.5% 10/1/14	230,000		231,355
6.5% 10/1/34	420,000		427,752
			1,153,343
Containers & Packaging - 0.0%
Sealed Air Corp. 5.625% 7/15/13 (e)	245,000		253,457

	Principal Amount		Value (Note 1)
Paper & Forest Products - 0.0%
International Paper Co.:
4.25% 1/15/09	$ 245,000		$ 245,897
5.5% 1/15/14	615,000		635,302
			881,199
TOTAL MATERIALS			2,287,999
TELECOMMUNICATION SERVICES - 0.7%
Diversified Telecommunication Services - 0.6%
AT&T Broadband Corp. 8.375% 3/15/13	500,000		616,548
Bellsouth Capital Funding Corp. 7.875% 2/15/30	765,000		952,840
BellSouth Corp. 5.2% 9/15/14	750,000		764,417
British Telecommunications PLC 8.875% 12/15/30	1,500,000		2,008,532
Deutsche Telekom International Finance BV 8.75% 6/15/30	1,500,000		1,980,687
France Telecom SA:
8.5% 3/1/11	300,000		357,871
9.5% 3/1/31	2,000,000		2,711,184
SBC Communications, Inc.:
6.15% 9/15/34	1,000,000		1,029,882
6.45% 6/15/34	1,000,000		1,071,367
Sprint Capital Corp. 6.875% 11/15/28	1,245,000		1,363,010
Telecom Italia Capital:
4.95% 9/30/14 (e)	705,000		690,716
5.25% 11/15/13	1,700,000		1,718,250
Telefonica Europe BV 7.75% 9/15/10	795,000		932,289
Verizon Global Funding Corp.:
7.25% 12/1/10	1,290,000		1,477,936
7.75% 12/1/30	720,000		895,195
			18,570,724
Wireless Telecommunication Services - 0.1%
America Movil SA de CV:
4.125% 3/1/09	650,000		640,339
5.5% 3/1/14	585,000		577,924
AT&T Wireless Services, Inc. 7.875% 3/1/11	400,000		471,447
			1,689,710
TOTAL TELECOMMUNICATION SERVICES			20,260,434
UTILITIES - 0.8%
Electric Utilities - 0.5%
Cleveland Electric Illuminating Co. 5.65% 12/15/13	1,205,000		1,249,720
DTE Energy Co. 7.05% 6/1/11	650,000		736,027
Duke Capital LLC:
4.37% 3/1/09	3,175,000		3,195,650
6.75% 2/15/32	100,000		108,821
Corporate Bonds - continued
	Principal Amount		Value (Note 1)
Nonconvertible Bonds - continued
UTILITIES - continued
Electric Utilities - continued
Exelon Corp. 6.75% 5/1/11	$ 1,500,000		$ 1,677,936
FirstEnergy Corp. 6.45% 11/15/11	285,000		309,644
Illinois Power Co. 7.5% 6/15/09	1,915,000		2,159,873
MidAmerican Energy Holdings, Inc. 5.875% 10/1/12	1,500,000		1,589,462
Progress Energy, Inc. 7.1% 3/1/11	2,745,000		3,086,047
			14,113,180
Gas Utilities - 0.1%
NiSource Finance Corp. 7.875% 11/15/10	1,455,000		1,710,467
Multi-Utilities & Unregulated Power - 0.2%
Constellation Energy Group, Inc. 7% 4/1/12	2,250,000		2,564,663
Dominion Resources, Inc.:
6.25% 6/30/12	1,000,000		1,091,789
8.125% 6/15/10	2,515,000		2,960,235
			6,616,687
TOTAL UTILITIES			22,440,334
TOTAL NONCONVERTIBLE BONDS			122,617,540
TOTAL CORPORATE BONDS (Cost $122,949,706)		132,588,703
U.S. Government and Government Agency Obligations - 7.5%

U.S. Government Agency Obligations - 1.8%
Fannie Mae:
2.5% 6/15/06	4,570,000		4,529,656
3.25% 8/15/08	820,000		809,192
3.25% 2/15/09	1,800,000		1,764,999
5.5% 3/15/11	3,605,000		3,865,825
6.25% 2/1/11	3,505,000		3,842,584
Farm Credit Systems Financial Assistance Corp. 8.8% 6/10/05	2,000,000		2,053,476
Freddie Mac:
3.625% 9/15/08	2,661,000		2,661,915
4% 6/12/13	11,318,000		10,809,675
5% 7/15/14	9,400,000		9,709,570

	Principal Amount		Value (Note 1)
5.875% 3/21/11	$ 7,760,000		$ 8,378,076
U.S. Department of Housing and Urban Development Government guaranteed participation certificates Series 1996-A, 7.63% 8/1/14	2,825,000		2,897,317
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS			51,322,285
U.S. Treasury Inflation Protected Obligations - 0.9%
U.S. Treasury Inflation-Indexed Bonds 2.375% 1/15/25	6,075,480		6,496,729
U.S. Treasury Inflation-Indexed Notes:
0.875% 4/15/10	6,045,060		5,986,260
2% 1/15/14	12,395,760		12,829,612
TOTAL U.S. TREASURY INFLATION PROTECTED OBLIGATIONS			25,312,601
U.S. Treasury Obligations - 4.8%
U.S. Treasury Bills, yield at date of purchase 1.83% to 2.21% 1/20/05 to 3/10/05 (g)	6,800,000		6,779,581
U.S. Treasury Bonds:
5.375% 2/15/31	1,300,000		1,405,726
6.25% 5/15/30	9,360,000		11,190,685
U.S. Treasury Notes:
1.625% 2/28/06	19,580,000		19,314,593
3.125% 5/15/07	22,390,000		22,378,626
4.75% 5/15/14	6,990,000		7,284,342
6.5% 2/15/10	42,705,000		48,348,380
7% 7/15/06	17,000,000		18,023,978
TOTAL U.S. TREASURY OBLIGATIONS			134,725,911
TOTAL U.S. GOVERNMENT AND GOVERNMENT AGENCY OBLIGATIONS (Cost $209,838,295)		211,360,797
U.S. Government Agency - Mortgage Securities - 8.1%

Fannie Mae - 7.6%
3.827% 12/1/34 (h)	25,000		25,055
3.836% 6/1/33 (h)	102,129		102,208
3.941% 10/1/34 (h)	171,803		173,030
4% 6/1/19	7,807,901		7,626,912
4.021% 12/1/34 (h)	125,000		125,742
4.037% 12/1/34 (h)	74,474		75,093
4.048% 1/1/35 (h)	100,000		100,727
4.072% 12/1/34 (h)	225,000		226,758
4.105% 1/1/35 (h)	250,000		249,047
4.17% 11/1/34 (h)	224,985		226,203
4.324% 12/1/34 (h)	74,998		76,215
4.5% 4/1/19 to 10/1/33	39,823,387		39,186,637
U.S. Government Agency - Mortgage Securities - continued
	Principal Amount		Value (Note 1)
Fannie Mae - continued
4.549% 8/1/34 (h)	$ 303,317		$ 310,441
5% 2/1/18 to 9/1/34	30,032,564		30,193,153
5.5% 12/1/18 to 10/1/34	72,353,550		73,610,541
5.5% 1/1/20 (f)	976,429		1,008,773
5.5% 1/1/35 (f)	6,000,000		6,084,375
6% 6/1/13 to 1/1/34	18,711,580		19,538,605
6.5% 9/1/08 to 9/1/32	22,834,398		24,051,210
7% 8/1/13 to 2/1/32	6,781,022		7,213,112
7.5% 7/1/16 to 11/1/31	2,676,549		2,870,986
8% 1/1/30 to 6/1/30	232,284		251,824
TOTAL FANNIE MAE			213,326,647
Freddie Mac - 0.0%
4.985% 8/1/33 (h)	100,000		102,711
7.5% 5/1/17 to 11/1/31	969,986		1,041,153
8% 7/1/17 to 5/1/27	76,259		82,917
TOTAL FREDDIE MAC			1,226,781
Government National Mortgage Association - 0.5%
6% 12/15/08 to 6/15/09	488,867		512,240
6.5% 6/15/08 to 8/15/27	5,770,247		6,096,254
7% 7/15/28 to 7/15/32	3,573,710		3,801,168
7.5% 9/15/22 to 8/15/28	1,932,392		2,082,895
8% 5/15/25 to 1/15/31	545,053		591,770
8.5% 12/15/16 to 12/15/30	276,268		301,590
TOTAL GOVERNMENT NATIONAL MORTGAGE ASSOCIATION			13,385,917
TOTAL U.S. GOVERNMENT AGENCY - MORTGAGE SECURITIES (Cost $223,440,950)		227,939,345
Asset-Backed Securities - 0.5%

ACE Securities Corp. Series 2004-HE1:
Class M1, 2.9175% 2/25/34 (h)	250,000		250,042
Class M2, 3.5175% 2/25/34 (h)	300,000		300,106
Ameriquest Mortgage Securities, Inc. Series 2004-R2:
Class M1, 2.8475% 4/25/34 (h)	145,000		145,002
Class M2, 2.8975% 4/25/34 (h)	125,000		125,002
Amortizing Residential Collateral Trust Series 2003-BC1 Class M2, 3.5175% 1/25/32 (h)	305,000		306,260
Argent Securities, Inc. Series 2004-W5 Class M1, 3.0175% 4/25/34 (h)	475,000		475,631

	Principal Amount		Value (Note 1)
Asset Backed Securities Corp. Home Equity Loan Trust Series 2004-HE3:
Class M1, 2.9575% 6/25/34 (h)	$ 175,000		$ 175,068
Class M2, 3.5375% 6/25/34 (h)	400,000		400,147
Capital One Multi-Asset Execution Trust:
Series 2003-B4 Class B4, 3.2025% 7/15/11 (h)	780,000		794,213
Series 2004-6 Class B, 4.15% 7/16/12	1,295,000		1,293,616
CDC Mortgage Capital Trust Series 2004-HE2 Class M2, 3.6175% 7/26/34 (h)	265,000		265,004
Citibank Credit Card Issuance Trust Series 2002-C1 Class C1, 3.2% 2/9/09 (h)	1,750,000		1,773,355
Countrywide Home Loans, Inc.:
Series 2004-2 Class M1, 2.9175% 5/25/34 (h)	625,000		625,010
Series 2004-3 Class M1, 2.9175% 6/25/34 (h)	175,000		175,180
Series 2004-4:
Class A, 2.7875% 8/25/34 (h)	506,149		505,976
Class M1, 2.8975% 7/25/34 (h)	450,000		450,950
Class M2, 2.9475% 6/25/34 (h)	525,000		526,254
Discover Card Master Trust I Series 2003-4 Class B1, 2.7325% 5/16/11 (h)	1,015,000		1,020,410
First Franklin Mortgage Loan Trust Series 2004-FF2:
Class M3, 2.9675% 3/25/34 (h)	50,000		50,001
Class M4, 3.3175% 3/25/34 (h)	25,000		25,000
Class M6, 3.6675% 3/25/34 (h)	50,000		50,052
Fremont Home Loan Trust Series 2004-A:
Class M1, 2.9675% 1/25/34 (h)	550,000		550,009
Class M2, 3.5675% 1/25/34 (h)	625,000		625,010
GSAMP Trust Series 2004-FM2:
Class M1, 2.9175% 1/25/34 (h)	500,000		500,008
Class M2, 3.5175% 1/25/34 (h)	200,000		200,003
Class M3, 3.7175% 1/25/34 (h)	200,000		200,003
Home Equity Asset Trust Series 2002-4 Class M2, 4.4675% 3/25/33 (h)	225,000		228,341
Long Beach Mortgage Loan Trust Series 2004-2:
Class M1, 2.9475% 6/25/34 (h)	500,000		499,603
Class M2, 3.4975% 6/25/34 (h)	325,000		326,684
Meritage Mortgage Loan Trust Series 2004-1:
Class M1, 2.9175% 7/25/34 (h)	250,000		250,004
Class M2, 2.9675% 7/25/34 (h)	50,000		50,001
Class M3, 3.3675% 7/25/34 (h)	100,000		100,002
Class M4, 3.5175% 7/25/34 (h)	75,000		75,001
Asset-Backed Securities - continued
	Principal Amount		Value (Note 1)
Morgan Stanley ABS Capital I, Inc.:
Series 2003-HE1 Class M2, 4.3175% 5/25/33 (h)	$ 175,000		$ 177,446
Series 2003-NC5 Class M2, 4.4175% 4/25/33 (h)	325,000		331,004
Morgan Stanley Dean Witter Capital I Trust Series 2003-NC1 Class M1, 3.4675% 11/25/32 (h)	305,000		308,242
Structured Asset Securities Corp. Series 2004-GEL1 Class A, 2.7775% 2/25/34 (h)	175,194		175,197
TOTAL ASSET-BACKED SECURITIES (Cost $14,301,255)		14,328,837
Collateralized Mortgage Obligations - 0.4%

Private Sponsor - 0.1%
CS First Boston Mortgage Securities Corp. floater:
Series 2004-AR3 Class 6A2, 2.7875% 4/25/34 (h)	445,400		446,057
Series 2004-AR5 Class 11A2, 2.7875% 6/25/34 (h)	578,575		577,342
Master Alternative Loan Trust Series 2004-3 Class 3A1, 6% 4/25/34	223,817		229,132
Residential Asset Mortgage Products, Inc. sequential pay Series 2004-SL2 Class A1, 6.5% 10/25/16	247,583		254,314
TOTAL PRIVATE SPONSOR			1,506,845
U.S. Government Agency - 0.3%
Fannie Mae planned amortization class:
Series 1999-54 Class PH, 6.5% 11/18/29	3,300,000		3,500,943
Series 1999-57 Class PH, 6.5% 12/25/29	2,600,000		2,745,310
Fannie Mae guaranteed REMIC pass thru certificates planned amortization class Series 2004-81 Class KD, 4.5% 4/25/17	2,390,000		2,404,427
TOTAL U.S. GOVERNMENT AGENCY			8,650,680
TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS (Cost $9,259,818)		10,157,525
Commercial Mortgage Securities - 1.5%

Bayview Commercial Asset Trust floater:
Series 2004-1:
Class A, 2.7775% 4/25/34 (e)(h)	836,820		834,270
Class B, 4.3175% 4/25/34 (e)(h)	92,980		92,824
Class M1, 2.9775% 4/25/34 (e)(h)	92,980		92,809
Class M2, 3.6175% 4/25/34 (e)(h)	92,980		92,940
Series 2004-3:
Class A1, 2.7675% 1/25/35 (e)(h)	798,629		798,629
Class A2, 2.8175% 1/25/35 (e)(h)	99,829		99,829
Class M1, 2.8975% 1/25/35 (e)(h)	149,743		149,743
Class M2, 3.3975% 1/25/35 (e)(h)	99,829		99,829
CBM Funding Corp. sequential pay Series 1996-1:
Class A3PI, 7.08% 11/1/07	1,743,730		1,828,476
Class B, 7.48% 2/1/08	2,320,000		2,529,665
COMM:
floater:
Series 2002-FL7 Class D, 2.9725% 11/15/14 (e)(h)	295,000		295,795
Series 2003-FL9 Class B, 2.9025% 11/15/15 (e)(h)	547,788		549,423
Series 2004-LBN2 Class X2, 1.2743% 3/10/39 (e)(h)(i)	2,029,801		86,554
CS First Boston Mortgage Securities Corp.:
sequential pay:
Series 1999-C1 Class A2, 7.29% 9/15/41	1,500,000		1,683,938
Series 2004-C1 Class A3, 4.321% 1/15/37	615,000		611,295
Series 1998-C1 Class D, 7.17% 5/17/40	580,000		649,729
Series 2004-C1 Class ASP, 1.0446% 1/15/37 (e)(h)(i)	9,980,000		399,141
Deutsche Mortgage & Asset Receiving Corp. sequential pay Series 1998-C1 Class D, 7.231% 6/15/31	4,350,000		4,784,712
Equitable Life Assurance Society of the United States Series 174:
Class B1, 7.33% 5/15/06 (e)	3,500,000		3,669,059
Class C1, 7.52% 5/15/06 (e)	2,300,000		2,414,420
Class D1, 7.77% 5/15/06 (e)	2,200,000		2,302,590
Fannie Mae sequential pay Series 1999-10 Class MZ, 6.5% 9/17/38	1,590,934		1,685,028
GS Mortgage Securities Corp. II:
sequential pay Series 2001-LIBA Class A2, 6.615% 2/14/16 (e)	695,000		765,446
Commercial Mortgage Securities - continued
	Principal Amount		Value (Note 1)
GS Mortgage Securities Corp. II: - continued
Series 1998-GLII Class E, 7.1905% 4/13/31 (h)	$ 1,205,000		$ 1,264,813
Leafs CMBS I Ltd./Leafs CMBS I Corp. Series 2002-1A:
Class B, 4.13% 11/20/37 (e)	1,050,000		1,002,996
Class C, 4.13% 11/20/37 (e)	1,050,000		958,125
Morgan Stanley Capital I, Inc. sequential pay Series 2004-HQ3 Class A2, 4.05% 1/13/41	630,000		625,305
Thirteen Affiliates of General Growth Properties, Inc.:
sequential pay Series 1 Class A2, 6.602% 11/15/07 (e)	4,200,000		4,472,481
Series 1:
Class D2, 6.992% 11/15/07 (e)	4,120,000		4,434,792
Class E2, 7.224% 11/15/07 (e)	2,450,000		2,626,022
Wachovia Bank Commercial Mortgage Trust sequential pay Series 2003-C6 Class A2, 4.498% 8/15/35	1,015,000		1,029,444
TOTAL COMMERCIAL MORTGAGE SECURITIES (Cost $40,912,220)		42,930,122
Foreign Government and Government Agency Obligations - 0.2%

Chilean Republic:
5.625% 7/23/07	1,630,000		1,706,406
7.125% 1/11/12	650,000		746,281
Korean Republic 4.875% 9/22/14	700,000		692,379
State of Israel 4.625% 6/15/13	230,000		219,794
United Mexican States:
5.875% 1/15/14	610,000		624,945
7.5% 4/8/33	2,350,000		2,538,000
TOTAL FOREIGN GOVERNMENT AND GOVERNMENT AGENCY OBLIGATIONS (Cost $6,088,552)		6,527,805
Fixed-Income Funds - 5.9%
	Shares
Fidelity Floating Rate Central Investment Portfolio (b)	142,657		14,250,008
Fidelity High Income Central Investment Portfolio 1 (b)	1,496,200		150,547,682
TOTAL FIXED-INCOME FUNDS (Cost $153,982,737)		164,797,690
Money Market Funds - 20.2%
	Shares		Value (Note 1)
Fidelity Cash Central Fund, 2.24% (b)	442,529,237		$ 442,529,237
Fidelity Money Market Central Fund, 2.22% (b)	123,860,162		123,860,162
Fidelity Securities Lending Cash Central Fund, 2.23% (b)(c)	3,836,100		3,836,100
TOTAL MONEY MARKET FUNDS (Cost $570,225,499)		570,225,499
TOTAL INVESTMENT PORTFOLIO - 100.1% (Cost $2,601,778,434)			2,822,687,712
NET OTHER ASSETS - (0.1)%			(1,713,006)
NET ASSETS - 100%		$ 2,820,974,706

Futures Contracts
	Expiration Date	Underlying Face Amount at Value	Unrealized Appreciation/ (Depreciation)
Purchased
Equity Index Contracts
395 S&P 500 Index Contracts	March 2005	$ 119,852,875	$ 815,884

The face value of futures purchased as a percentage of net assets - 4.2%

Swap Agreements
		Notional Amount	Value
Interest Rate Swap
Receive quarterly a fixed rate equal to 3.524% and pay quarterly a floating rate based on 3-month LIBOR with Morgan Stanley, Inc.	May 2007	$ 14,900,000	$ 22,334

Swap Agreements - continued

		Notional Amount	Value
Total Return Swap
Receive monthly a return equal to Lehman Brothers for CMBS AAA 8.5+ Index and pay monthly a floating rate based on 1-month LIBOR minus 40 basis points with Lehman Brothers, Inc.	April 2005	$ 2,500,000	$ 25,857
Receive quarterly a return equal to Banc of America Securities LLC AAA 10Yr Commercial Mortgage-Backed Securities Daily Index and pay quarterly a floating rate based on 3-month LIBOR minus 72 basis points with Bank of America	Jan. 2005	2,500,000	(8,676)
Receive quarterly a return equal to that of Banc of America Securities LLC AAA 10Yr Commercial Mortgage Backed Securities Daily Index and pay quarterly a floating rate based on 3-month LIBOR minus 30 basis points with Bank of America	May 2005	2,500,000	(2,782)
Receive quarterly a return equal to that of Banc of America Securities LLC AAA 10Yr Commercial Mortgage-Backed Securities Daily Index and pay quarterly a floating rate based on 3-month LIBOR minus 27 basis points with Bank of America	June 2005	2,500,000	33,269
TOTAL TOTAL RETURN SWAPS		10,000,000	47,670
		$ 24,900,000	$ 70,002

Legend

(a) Non-income producing

(b) Affiliated fund that is available only to investment companies and other accounts managed by Fidelity Investments. The rates quoted for Money Market Funds are the annualized seven-day yield of the funds at period end. A complete listing of each fund's holdings as of its most recent fiscal year end is available upon request.

(d) Security or a portion of the security is on loan at period end.

(e) Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At the period end, the value of these securities amounted to $41,105,208 or 1.5% of net assets.

(f) Security or a portion of the security purchased on a delayed delivery or when-issued basis.

(g) Security or a portion of the security was pledged to cover margin requirements for futures contracts. At the period end, the value of securities pledged amounted to $6,779,581.

(h) The coupon rate shown on floating or adjustable rate securities represents the rate at period end.

(i) Security represents right to receive monthly interest payments on an underlying pool of mortgages. Principal shown is the par amount of the mortgage pool.

Other Information

The composition of credit quality ratings as a percentage of net assets is as follows (ratings are unaudited):

U.S. Government and U.S. Government Agency Obligations	15.8%
AAA, AA, A	2.6%
BBB	4.2%
BB	2.0%
B	2.8%
CCC, CC, C	0.7%
Not Rated	0.3%
Other Investments	0.0%
Equities	55.3%
Short-Term Investments and Net Other Assets	16.3%
	100.0%

We have used ratings from Moody's Investors Services, Inc. Where Moody's ratings are not available, we have used S&P ratings. Percentages are adjusted for the effect of futures contracts, if applicable.

The information in the above table is based on the combined investments of the fund and its pro-rata share of the investments of Fidelity's fixed-income central funds.

Income Tax Information

At December 31, 2004, the fund had a capital loss carryforward of approximately $169,228,000 of which $94,606,000, $33,904,000 and $40,718,000 will expire on December 31, 2009, 2010 and 2011, respectively.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products: Asset Manager Portfolio

Financial Statements

Statement of Assets and Liabilities

December 31, 2004

Assets
Investment in securities, at value (including securities loaned of $3,740,989) (cost $2,601,778,434) - See accompanying schedule		$ 2,822,687,712
Cash		101,094
Foreign currency held at value (cost $1,769,693)		1,863,876
Receivable for investments sold		3,763,867
Receivable for fund shares sold		433,148
Dividends receivable		1,531,913
Interest receivable		8,159,830
Swap agreements, at value		70,002
Prepaid expenses		11,031
Other affiliated receivables		20,779
Other receivables		66,083
Total assets		2,838,709,335
Liabilities
Payable for investments purchased Regular delivery	$ 2,505,482
Delayed delivery	7,119,958
Payable for fund shares redeemed	2,255,870
Accrued management fee	1,228,673
Distribution fees payable	10,154
Payable for daily variation on futures contracts	98,750
Other affiliated payables	332,770
Other payables and accrued expenses	346,872
Collateral on securities loaned, at value	3,836,100
Total liabilities		17,734,629
Net Assets		$ 2,820,974,706
Net Assets consist of:
Paid in capital		$ 2,705,402,110
Undistributed net investment income		75,292,815
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions		(181,610,482)
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies		221,890,263
Net Assets		$ 2,820,974,706
Initial Class: Net Asset Value, offering price and redemption price per share ($2,751,093,961 ÷ 185,310,323 shares)		$ 14.85
Service Class: Net Asset Value, offering price and redemption price per share ($33,117,654 ÷ 2,245,860 shares)		$ 14.75
Service Class 2: Net Asset Value, offering price and redemption price per share ($36,763,091 ÷ 2,510,405 shares)		$ 14.64

Statement of Operations

Year ended December 31, 2004

Investment Income
Dividends		$ 24,564,893
Special Dividends		7,532,376
Interest		59,893,575
Security lending		43,187
Total income		92,034,031

Expenses
Management fee	$ 15,228,347
Transfer agent fees	1,937,089
Distribution fees	101,698
Accounting and security lending fees	1,165,808
Non-interested trustees' compensation	16,074
Appreciation in deferred trustee compensation account	5,876
Custodian fees and expenses	223,949
Audit	61,090
Legal	15,600
Miscellaneous	414,429
Total expenses before reductions	19,169,960
Expense reductions	(238,955)	18,931,005
Net investment income (loss)		73,103,026
Realized and Unrealized Gain (Loss) Net realized gain (loss) on:
Investment securities	64,290,412
Foreign currency transactions	(157,622)
Futures contracts	11,752,551
Swap agreements	593,284
Total net realized gain (loss)		76,478,625
Change in net unrealized appreciation (depreciation) on: Investment securities	2,622,778
Assets and liabilities in foreign currencies	97,880
Futures contracts	(1,965,782)
Swap agreements	(176,130)
Delayed delivery commitments	(1,380)
Total change in net unrealized appreciation (depreciation)		577,366
Net gain (loss)		77,055,991
Net increase (decrease) in net assets resulting from operations		$ 150,159,017

See accompanying notes which are an integral part of the financial statements.

Annual Report

Statement of Changes in Net Assets

	Year ended December 31, 2004	Year ended December 31, 2003
Increase (Decrease) in Net Assets
Operations
Net investment income (loss)	$ 73,103,026	$ 78,176,621
Net realized gain (loss)	76,478,625	(40,714,310)
Change in net unrealized appreciation (depreciation)	577,366	441,444,012
Net increase (decrease) in net assets resulting from operations	150,159,017	478,906,323
Distributions to shareholders from net investment income	(81,683,788)	(104,597,799)
Share transactions - net increase (decrease)	(313,880,450)	(134,932,020)
Total increase (decrease) in net assets	(245,405,221)	239,376,504

Net Assets
Beginning of period	3,066,379,927	2,827,003,423
End of period (including undistributed net investment income of $75,292,815 and undistributed net investment income of $85,502,782, respectively)	$ 2,820,974,706	$ 3,066,379,927

Other Information:
Share Transactions	Year ended December 31, 2004
Shares	Initial Class	Service Class	Service Class 2
Sold	8,726,898	845,301	1,250,787
Reinvested	5,552,576	60,513	40,552
Redeemed	(37,314,309)	(893,122)	(354,143)
Net increase (decrease)	(23,034,835)	12,692	937,196

Dollars Sold	$ 124,852,377	$ 12,068,224	$ 17,624,320
Reinvested	80,234,728	869,573	579,487
Redeemed	(532,488,555)	(12,617,698)	(5,002,906)
Net increase (decrease)	$ (327,401,450)	$ 320,099	$ 13,200,901
Share Transactions	Year ended December 31, 2003
Shares	Initial Class	Service Class	Service Class 2
Sold	11,779,012	428,403	476,542
Reinvested	8,641,306	77,907	49,303
Redeemed	(30,580,450)	(301,785)	(252,268)
Net increase (decrease)	(10,160,132)	204,525	273,577

Dollars Sold	$ 156,744,839	$ 5,650,186	$ 6,262,526
Reinvested	103,090,780	924,754	582,265
Redeemed	(400,951,959)	(3,964,032)	(3,271,379)
Net increase (decrease)	$ (141,116,340)	$ 2,610,908	$ 3,573,412
Distributions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2
From net investment income	$ 80,234,728	$ 869,573	$ 579,487
	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2
From net investment income	$ 103,090,780	$ 924,754	$ 582,265

See accompanying notes which are an integral part of the financial statements.

Asset Manager Portfolio

Financial Highlights - Initial Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 14.46	$ 12.75	$ 14.51	$ 16.01	$ 18.67
Income from Investment Operations
Net investment income (loss)^C	.36^D	.36	.46	.51	.62
Net realized and unrealized gain (loss)	.42	1.83	(1.69)	(1.13)	(1.30)
Total from investment operations	.78	2.19	(1.23)	(.62)	(.68)
Distributions from net investment income	(.39)	(.48)	(.53)	(.64)	(.60)
Distributions from net realized gain	-	-	-	(.24)	(1.38)
Total distributions	(.39)	(.48)	(.53)	(.88)	(1.98)
Net asset value, end of period	$ 14.85	$ 14.46	$ 12.75	$ 14.51	$ 16.01
Total Return^{A, B}	5.47%	17.97%	(8.73)%	(4.15)%	(3.87)%
Ratios to Average Net Assets^E
Expenses before expense reductions	.66%	.63%	.63%	.64%	.61%
Expenses net of voluntary waivers, if any	.66%	.63%	.63%	.64%	.61%
Expenses net of all reductions	.65%	.62%	.61%	.63%	.61%
Net investment income (loss)	2.53%	2.71%	3.49%	3.53%	3.73%
Supplemental Data
Net assets, end of period (000 omitted)	$ 2,751,094	$ 3,011,837	$ 2,784,945	$ 3,547,730	$ 4,128,169
Portfolio turnover rate	66%	82%	140%	108%	76%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^D Investment income per share reflects a special dividend which amounted to $.04 per share.

^E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of any voluntary waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.

Financial Highlights - Service Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 14.37	$ 12.66	$ 14.41	$ 15.91	$ 18.59
Income from Investment Operations
Net investment income (loss)^C	.34^D	.34	.44	.49	.60
Net realized and unrealized gain (loss)	.42	1.83	(1.68)	(1.12)	(1.31)
Total from investment operations	.76	2.17	(1.24)	(.63)	(.71)
Distributions from net investment income	(.38)	(.46)	(.51)	(.63)	(.59)
Distributions from net realized gain	-	-	-	(.24)	(1.38)
Total distributions	(.38)	(.46)	(.51)	(.87)	(1.97)
Net asset value, end of period	$ 14.75	$ 14.37	$ 12.66	$ 14.41	$ 15.91
Total Return^{A, B}	5.36%	17.91%	(8.85)%	(4.24)%	(4.06)%
Ratios to Average Net Assets^E
Expenses before expense reductions	.77%	.74%	.74%	.74%	.72%
Expenses net of voluntary waivers, if any	.77%	.74%	.74%	.74%	.72%
Expenses net of all reductions	.76%	.73%	.72%	.73%	.71%
Net investment income (loss)	2.41%	2.59%	3.38%	3.43%	3.62%
Supplemental Data
Net assets, end of period (000 omitted)	$ 33,118	$ 32,087	$ 25,692	$ 31,324	$ 30,583
Portfolio turnover rate	66%	82%	140%	108%	76%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^D Investment income per share reflects a special dividend which amounted to $.04 per share.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Service Class 2

Years ended December 31,	2004	2003	2002	2001	2000^G
Selected Per-Share Data
Net asset value, beginning of period	$ 14.27	$ 12.59	$ 14.36	$ 15.89	$ 18.17
Income from Investment Operations
Net investment income (loss)^E	.32^F	.32	.41	.46	.53
Net realized and unrealized gain (loss)	.41	1.81	(1.67)	(1.11)	(.84)
Total from investment operations	.73	2.13	(1.26)	(.65)	(.31)
Distributions from net investment income	(.36)	(.45)	(.51)	(.64)	(.59)
Distributions from net realized gain	-	-	-	(.24)	(1.38)
Total distributions	(.36)	(.45)	(.51)	(.88)	(1.97)
Net asset value, end of period	$ 14.64	$ 14.27	$ 12.59	$ 14.36	$ 15.89
Total Return^{B, C, D}	5.18%	17.66%	(9.03)%	(4.38)%	(1.97)%
Ratios to Average Net Assets^H
Expenses before expense reductions	.93%	.91%	.90%	.90%	.88%^A
Expenses net of voluntary waivers, if any	.93%	.91%	.90%	.90%	.88%^A
Expenses net of all reductions	.92%	.89%	.88%	.89%	.88%^A
Net investment income (loss)	2.25%	2.43%	3.22%	3.27%	3.46%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 36,763	$ 22,456	$ 16,367	$ 11,993	$ 4,785
Portfolio turnover rate	66%	82%	140%	108%	76%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F Investment income per share reflects a special dividend which amounted to $.04 per share.

^G For the period January 12, 2000 (commencement of sale of shares) to December 31, 2000.

^H Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of any voluntary waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.

See accompanying notes which are an integral part of the financial statements.

Asset Manager Portfolio

Fidelity Variable Insurance Products: Contrafund Portfolio

Performance: The Bottom Line

Average Annual Total Returns

Periods ended December 31, 2004	Past 1 year	Past 5 years	Life of fund^A
Fidelity® VIP: Contrafund - Initial Class	15.48%	1.96%	14.11%
Fidelity VIP: Contrafund - Service Class^B	15.34%	1.85%	14.03%
Fidelity VIP: Contrafund - Service Class 2^C	15.16%	1.71%	13.94%

^A From January 3, 1995

^B The initial offering of Service Class shares took place on November 3, 1997. Performance for Service Class shares reflects an asset-based service fee (12b-1 fee), and returns prior to November 3, 1997 are those of Initial Class and do not include the effects of Service Class' 12b-1 fee. Had Service Class shares' 12b-1 fee been reflected, returns prior to November 3, 1997 would have been lower.

^C The initial offering of Service Class 2 shares took place on January 12, 2000. Performance for Service Class 2 shares reflects an asset-based service fee (12b-1 fee). Returns from November 3, 1997 through January 12, 2000 are those of Service Class which reflect a different 12b-1 fee. Service Class 2 returns prior to November 3, 1997 are those of Initial Class, and do not include the effects of a 12b-1 fee. Had Service Class 2's 12b-1 fee been reflected, returns prior to January 12, 2000 would have been lower.

$10,000 Over Life of Fund

Let's say hypothetically that $10,000 was invested in Fidelity® Variable Insurance Products: Contrafund Portfolio - Initial Class on January 3, 1995, when the fund started. The chart shows how the value of your investment would have changed, and also shows how the Standard & Poor's 500^SM Index performed over the same period.

Annual Report

Fidelity Variable Insurance Products: Contrafund Portfolio

Management's Discussion of Fund Performance

Comments from Will Danoff, Portfolio Manager of Fidelity® Variable Insurance Products: Contrafund Portfolio

The year ending December 31, 2004, generally was positive for equity investors, as many stock market benchmarks produced double-digit gains. Broad-based themes included the continued dominance of small-cap stocks, which outperformed large-caps for the sixth consecutive year. The small-cap Russell 2000® Index was up 18.33% in 2004, while the larger-cap Standard & Poor's 500^SM Index rose 10.88%. Value stocks ended the year well ahead of growth stocks: The Russell 3000® Value Index advanced 16.94%, compared to 6.93% for the Russell 3000 Growth Index. Energy and basic materials stocks led the market upward. Energy stocks were boosted by record-high oil prices, while strong demand from China helped support commodity prices. The health care sector was among the market's weakest performers. Technology also fell off the pace, though it was helped by a rally late in the year. The tech-heavy NASDAQ Composite® Index returned 9.15%, thanks primarily to a 14.87% jump in the fourth quarter. Elsewhere, the Dow Jones Industrial Average^SM gained 5.37% for the year.

For the 12 months ending December 31, 2004, the fund outpaced both the S&P 500®and the Lipper^SMVariable Annuity Growth Funds Average, which gained 10.36%. Strong individual security selection within both the technology and telecommunication services sectors helped overall performance, as did the fund's continued emphasis on small- and mid-cap stocks, which outperformed their larger counterparts in 2004. At the end of the period, the fund held approximately 36% of its assets in stocks of companies with market capitalizations of less than $10 billion, compared to 12% for the S&P 500. The fund's best individual performers included Internet stalwarts such as Google, Yahoo! and eBay, all of which appreciated more than 65% in 2004. Within telecommunications, the fund's positions in Research In Motion, which makes the BlackBerry portable e-mail device, and America Movil, a leading wireless services provider in Latin America, also fared well. Disappointments included Ireland-based Ryanair, Europe's leading discount airline, which fell in value as the carrier's profits were squeezed by higher oil prices and intense competition. Profit pressures also hurt the fund's positions in Krispy Kreme Doughnuts, semiconductor maker Silicon Laboratories and discount retailer 99 Cents Only Stores.

The views expressed in this statement reflect those of the portfolio manager only through the end of the period of the report as stated on the cover and do not necessarily represent the views of Fidelity or any other person in the Fidelity organization. Any such 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.

Annual Report

Fidelity Variable Insurance Products: Contrafund Portfolio

Investment Summary

Top Five Stocks as of December 31, 2004
	% of fund's net assets
Berkshire Hathaway, Inc. Class A	2.6
3M Co.	2.4
Avon Products, Inc.	2.3
EnCana Corp.	2.2
Yahoo!, Inc.	1.9
	11.4
Top Five Market Sectors as of December 31, 2004
	% of fund's net assets
Information Technology	15.0
Financials	12.6
Industrials	12.2
Health Care	11.3
Consumer Discretionary	11.1

Asset Allocation as of December 31, 2004
% of fund's net assets *
	Stocks	90.0%
	Bonds	1.6%
	Short-Term Investments and Net Other Assets	8.4%

* Foreign investments 25.1%

Annual Report

Fidelity Variable Insurance Products: Contrafund Portfolio

Investments December 31, 2004

Showing Percentage of Net Assets

Common Stocks - 90.0%
	Shares		Value (Note 1)
CONSUMER DISCRETIONARY - 11.1%
Automobiles - 0.6%
Honda Motor Co. Ltd.	90,200		$ 4,701,224
Toyota Motor Corp.	1,603,700		65,647,461
			70,348,685
Hotels, Restaurants & Leisure - 2.7%
Ambassadors Group, Inc.	364,604		12,983,548
Aristocrat Leisure Ltd.	1,683,867		13,108,703
Boyd Gaming Corp.	388,000		16,160,200
Ctrip.com International Ltd. ADR	55,100		2,535,702
Domino's Pizza, Inc.	353,500		6,292,300
Four Seasons Hotels, Inc. (ltd. vtg.) (d)	203,100		16,605,118
Friendly Ice Cream Corp. (a)	204,600		1,718,640
Gaylord Entertainment Co. (a)	52,827		2,193,905
Great Canadian Gaming Corp. (a)	78,900		2,992,283
Greek Organization of Football Prognostics SA	112,516		3,107,620
Hilton Group PLC	1,795,398		9,802,330
International Game Technology	189,350		6,509,853
Kerzner International Ltd. (a)	175,900		10,562,795
Krispy Kreme Doughnuts, Inc. (a)(d)	312,100		3,932,460
Life Time Fitness, Inc.	125,800		3,255,704
Marriott International, Inc. Class A	169,700		10,687,706
P.F. Chang's China Bistro, Inc. (a)	145,500		8,198,925
Panera Bread Co. Class A (a)(d)	519,296		20,938,015
Penn National Gaming, Inc. (a)	131,431		7,958,147
Pinnacle Entertainment, Inc. (a)	44,800		886,144
Red Robin Gourmet Burgers, Inc. (a)	330,986		17,697,821
Ryan's Restaurant Group, Inc. (a)	282,750		4,360,005
Scientific Games Corp. Class A (a)	116,900		2,786,896
Shuffle Master, Inc. (a)(d)	403,989		19,027,882
Starbucks Corp. (a)	716,800		44,699,648
Station Casinos, Inc.	812,500		44,427,500
The Cheesecake Factory, Inc. (a)	245,436		7,969,307
William Hill PLC	2,355,742		25,497,237
Wynn Resorts Ltd. (a)	392,746		26,282,562
			353,178,956
Household Durables - 1.4%
Black & Decker Corp.	33,600		2,967,888
Blount International, Inc. (a)	421,300		7,339,046
Blyth, Inc.	69,000		2,039,640
Centex Corp.	45,000		2,681,100
D.R. Horton, Inc.	795,277		32,057,616
Desarrolladora Homex SA de CV ADR (d)	112,500		2,660,625
Fortune Brands, Inc.	275,900		21,293,962
Harman International Industries, Inc.	390,700		49,618,900
Hovnanian Enterprises, Inc. Class A (a)	117,900		5,838,408
KB Home	68,300		7,130,520
Leggett & Platt, Inc.	180,100		5,120,243
Mohawk Industries, Inc. (a)	102,600		9,362,250
Pulte Homes, Inc.	6,700		427,460
Ryland Group, Inc.	40,600		2,336,124

	Shares		Value (Note 1)
Sharp Corp.	316,000		$ 5,161,261
Tempur-Pedic International, Inc.	368,300		7,807,960
Toll Brothers, Inc. (a)	235,100		16,130,211
			179,973,214
Internet & Catalog Retail - 1.2%
eBay, Inc. (a)	1,230,900		143,129,052
IAC/InterActiveCorp (a)	349,767		9,660,565
			152,789,617
Media - 1.3%
Central European Media Enterprises Ltd. Class A (a)	65,200		2,541,626
Citadel Broadcasting Corp. (a)	100,500		1,626,090
EchoStar Communications Corp. Class A	67,400		2,240,376
Fox Entertainment Group, Inc. Class A (a)	453,500		14,176,410
Getty Images, Inc. (a)	214,400		14,761,440
Lakes Entertainment, Inc. (a)	163,100		2,656,899
McGraw-Hill Companies, Inc.	8,900		814,706
Omnicom Group, Inc.	27,200		2,293,504
Pixar (a)	474,553		40,626,482
SBS Broadcasting SA (a)	338,400		13,613,832
Sirius Satellite Radio, Inc. (a)(d)	270,100		2,066,265
Spanish Broadcasting System, Inc. Class A (a)	2,682		28,322
Univision Communications, Inc. Class A (a)	163,600		4,788,572
Vivendi Universal SA sponsored ADR (a)	50,400		1,616,328
Walt Disney Co.	180,800		5,026,240
Washington Post Co. Class B	20,100		19,758,702
XM Satellite Radio Holdings, Inc. Class A (a)	1,060,257		39,886,868
			168,522,662
Multiline Retail - 0.4%
99 Cents Only Stores (a)(d)	106,666		1,723,723
JCPenney Co., Inc.	175,900		7,282,260
Neiman Marcus Group, Inc. Class A	218,800		15,652,952
Next PLC	276,200		8,745,687
Nordstrom, Inc.	157,500		7,359,975
Target Corp.	269,700		14,005,521
			54,770,118
Specialty Retail - 2.4%
Advance Auto Parts, Inc. (a)	100,100		4,372,368
bebe Stores, Inc.	101,250		2,731,725
Bed Bath & Beyond, Inc. (a)	767,100		30,553,593
Build-A-Bear Workshop, Inc.	166,000		5,834,900
Chico's FAS, Inc. (a)	742,400		33,801,472
Genesco, Inc. (a)	90,000		2,802,600
Guitar Center, Inc. (a)	161,300		8,498,897
Halfords Group PLC	943,366		5,612,136
Hennes & Mauritz AB (H&M) (B Shares)	379,275		13,211,677
Inditex SA	146,100		4,300,765
Lowe's Companies, Inc.	92,600		5,332,834
New York & Co., Inc.	182,100		3,008,292
Pacific Sunwear of California, Inc. (a)	479,572		10,675,273
Common Stocks - continued
	Shares		Value (Note 1)
CONSUMER DISCRETIONARY - continued
Specialty Retail - continued
PETCO Animal Supplies, Inc. (a)	693,200		$ 27,367,536
PETsMART, Inc.	999,900		35,526,447
Regis Corp.	141,400		6,525,610
Sherwin-Williams Co.	45,700		2,039,591
Signet Group PLC	2,348,926		4,958,477
Staples, Inc.	1,087,100		36,646,141
The Pantry, Inc. (a)	59,466		1,789,332
TJX Companies, Inc.	1,032,200		25,939,186
Too, Inc. (a)	158,400		3,874,464
United Auto Group, Inc.	52,600		1,556,434
Urban Outfitters, Inc. (a)	667,900		29,654,760
			306,614,510
Textiles, Apparel & Luxury Goods - 1.1%
Burberry Group PLC	3,022,995		23,263,127
Carter's, Inc. (a)	86,000		2,923,140
Coach, Inc. (a)	1,266,324		71,420,674
Delta Woodside Industries, Inc. (a)	22,175		13,970
Fossil, Inc. (a)	220,000		5,640,800
Hartmarx Corp. (a)	80,200		623,154
NIKE, Inc. Class B	116,200		10,538,178
Polo Ralph Lauren Corp. Class A	116,300		4,954,380
Puma AG	38,742		10,631,970
Quiksilver, Inc. (a)	210,000		6,255,900
Wolverine World Wide, Inc.	26,800		842,056
			137,107,349
TOTAL CONSUMER DISCRETIONARY			1,423,305,111
CONSUMER STAPLES - 6.0%
Beverages - 0.1%
Anheuser-Busch Companies, Inc.	105,900		5,372,307
Cott Corp. (a)	20,000		494,667
PepsiCo, Inc.	210,410		10,983,402
			16,850,376
Food & Staples Retailing - 1.6%
Alimentation Couche-Tard, Inc. Class B (sub. vtg.) (a)	112,700		3,334,042
CVS Corp.	45,000		2,028,150
Sysco Corp.	2,220,800		84,767,936
Tesco PLC	3,397,590		20,978,567
United Natural Foods, Inc. (a)	332,952		10,354,807
Wal-Mart de Mexico SA de CV Series V	1,349,700		4,638,827
Wal-Mart Stores, Inc.	168,500		8,900,170
Walgreen Co.	67,000		2,570,790
Whole Foods Market, Inc.	449,407		42,850,957
William Morrison Supermarkets PLC	5,674,750		22,542,567
			202,966,813
Food Products - 0.5%
Hershey Foods Corp.	460,700		25,587,278

	Shares		Value (Note 1)
Kellogg Co.	536,100		$ 23,942,226
Wm. Wrigley Jr. Co.	275,400		19,054,926
			68,584,430
Household Products - 0.6%
Colgate-Palmolive Co.	1,441,500		73,747,140
Personal Products - 3.2%
Avon Products, Inc.	7,577,456		293,247,547
Gillette Co.	2,615,600		117,126,568
			410,374,115
TOTAL CONSUMER STAPLES			772,522,874
ENERGY - 9.0%
Energy Equipment & Services - 0.7%
BJ Services Co.	94,000		4,374,760
Noble Corp. (a)	12,200		606,828
Offshore Logistics, Inc. (a)	14,100		457,827
Oil States International, Inc. (a)	146,300		2,822,127
Schlumberger Ltd. (NY Shares)	862,000		57,710,900
Smith International, Inc. (a)	456,575		24,842,246
Superior Energy Services, Inc. (a)	112,600		1,735,166
Tenaris SA sponsored ADR	75,700		3,701,730
			96,251,584
Oil & Gas - 8.3%
Anadarko Petroleum Corp.	84,600		5,482,926
Apache Corp.	783,980		39,645,869
Ashland, Inc.	165,300		9,650,214
Bill Barrett Corp.	57,500		1,839,425
Blackrock Ventures, Inc. (a)	959,200		5,875,100
BP PLC sponsored ADR	2,035,232		118,857,549
Burlington Resources, Inc.	901,380		39,210,030
Chesapeake Energy Corp.	1,336,000		22,044,000
China Petroleum & Chemical Corp. sponsored ADR (d)	524,740		21,509,093
Denbury Resources, Inc. (a)	44,800		1,229,760
EnCana Corp.	5,028,492		286,624,044
Encore Acquisition Co. (a)	278,800		9,732,908
ENI Spa sponsored ADR	67,400		8,481,616
EOG Resources, Inc.	190,700		13,608,352
Exxon Mobil Corp.	1,971,400		101,053,964
Houston Exploration Co. (a)	214,300		12,067,233
Imperial Oil Ltd.	66,800		3,960,683
Marathon Oil Corp.	137,000		5,152,570
McMoRan Exploration Co. (a)(d)	180,800		3,380,960
Murphy Oil Corp.	971,500		78,157,175
Noble Energy, Inc.	122,000		7,522,520
Occidental Petroleum Corp.	416,600		24,312,776
Patina Oil & Gas Corp.	185,300		6,948,750
PetroChina Co. Ltd. sponsored ADR (d)	173,600		9,320,584
PetroKazakhstan, Inc. Class A	182,960		6,789,341
Premcor, Inc.	1,892,826		79,820,472
Quicksilver Resources, Inc. (a)	307,400		11,306,172
Range Resources Corp.	243,300		4,977,918
Common Stocks - continued
	Shares		Value (Note 1)
ENERGY - continued
Oil & Gas - continued
Talisman Energy, Inc.	256,610		$ 6,917,778
Teekay Shipping Corp.	67,600		2,846,636
Total SA sponsored ADR	576,900		63,366,696
Unocal Corp. (d)	161,700		6,991,908
Valero Energy Corp.	412,900		18,745,660
Whiting Petroleum Corp. New (a)	133,100		4,026,275
XTO Energy, Inc.	769,425		27,222,257
			1,068,679,214
TOTAL ENERGY			1,164,930,798
FINANCIALS - 12.6%
Capital Markets - 0.4%
Calamos Asset Management, Inc. Class A	64,000		1,728,000
Goldman Sachs Group, Inc.	92,300		9,602,892
Legg Mason, Inc.	119,700		8,769,222
Lehman Brothers Holdings, Inc.	224,100		19,604,268
Merrill Lynch & Co., Inc.	157,700		9,425,729
SEI Investments Co.	39,400		1,652,042
			50,782,153
Commercial Banks - 1.5%
BOK Financial Corp. (a)	50,510		2,462,868
East West Bancorp, Inc.	147,700		6,197,492
Hibernia Corp. Class A	73,913		2,181,173
HSBC Holdings PLC sponsored ADR	260,917		22,214,473
M&T Bank Corp.	510,200		55,019,968
Nara Bancorp, Inc.	45,000		957,150
PrivateBancorp, Inc.	30,600		986,238
Royal Bank of Scotland Group PLC	231,395		7,779,906
Southwest Bancorp of Texas, Inc.	22,600		526,354
Texas Capital Bancshares, Inc. (a)	6,600		142,692
UCBH Holdings, Inc.	166,430		7,625,823
Wachovia Corp.	557,749		29,337,597
Wells Fargo & Co.	780,200		48,489,430
Westcorp	144,320		6,628,618
Wintrust Financial Corp.	105,700		6,020,672
			196,570,454
Consumer Finance - 1.1%
First Marblehead Corp. (a)	109,100		6,136,875
MBNA Corp.	877,900		24,748,001
SLM Corp.	1,960,300		104,660,417
			135,545,293
Diversified Financial Services - 0.6%
Brascan Corp. Class A (ltd. vtg.)	243,900		8,770,238
CapitalSource, Inc. (a)	234,300		6,014,481
Citigroup, Inc.	3,500		168,630

	Shares		Value (Note 1)
KKR Financial Corp. (e)	564,000		$ 5,922,000
Moody's Corp.	674,200		58,554,270
			79,429,619
Insurance - 7.5%
ACE Ltd.	298,800		12,773,700
AFLAC, Inc.	247,500		9,860,400
Allstate Corp.	1,200,900		62,110,548
American International Group, Inc.	2,363,114		155,185,696
Assurant, Inc.	443,500		13,548,925
Berkshire Hathaway, Inc. Class A (a)	3,839		337,448,087
Brit Insurance Holdings PLC	3,985,600		6,023,245
Endurance Specialty Holdings Ltd.	358,100		12,247,020
Everest Re Group Ltd.	863,980		77,378,049
Fidelity National Financial, Inc.	45,100		2,059,717
Genworth Financial, Inc. Class A	90,000		2,430,000
Great-West Lifeco, Inc.	134,000		2,981,500
HCC Insurance Holdings, Inc.	510,700		16,914,384
IPC Holdings Ltd.	160,300		6,974,653
Markel Corp. (a)	29,750		10,829,000
Mercury General Corp.	232,500		13,931,400
MetLife, Inc.	266,600		10,799,966
Montpelier Re Holdings Ltd.	1,449,200		55,721,740
PartnerRe Ltd.	340,200		21,071,988
Progressive Corp.	272,500		23,118,900
RenaissanceRe Holdings Ltd.	767,565		39,974,785
StanCorp Financial Group, Inc.	154,900		12,779,250
USI Holdings Corp. (a)	916,187		10,600,284
W.R. Berkley Corp.	455,150		21,469,426
White Mountains Insurance Group Ltd.	12,300		7,945,800
Willis Group Holdings Ltd.	367,100		15,113,507
			961,291,970
Real Estate - 0.3%
CB Richard Ellis Group, Inc. Class A	429,800		14,419,790
CBL & Associates Properties, Inc.	137,781		10,519,579
Equity Residential (SBI)	192,900		6,979,122
General Growth Properties, Inc.	86,790		3,138,326
Vornado Realty Trust	60,900		4,636,317
Weingarten Realty Investors (SBI)	67,400		2,702,740
			42,395,874
Thrifts & Mortgage Finance - 1.2%
Countrywide Financial Corp.	278,076		10,291,593
Doral Financial Corp.	483,175		23,796,369
Freddie Mac	33,700		2,483,690
Golden West Financial Corp., Delaware	1,922,400		118,073,808
W Holding Co., Inc.	23,970		549,872
			155,195,332
TOTAL FINANCIALS			1,621,210,695
HEALTH CARE - 11.3%
Biotechnology - 1.8%
Affymetrix, Inc. (a)	38,200		1,396,210
Common Stocks - continued
	Shares		Value (Note 1)
HEALTH CARE - continued
Biotechnology - continued
Biogen Idec, Inc. (a)	479,300		$ 31,926,173
Gen-Probe, Inc. (a)	357,100		16,144,491
Genentech, Inc. (a)	3,263,400		177,659,496
Pharmion Corp. (a)	28,400		1,198,764
Seattle Genetics, Inc. (a)	712,300		4,651,319
			232,976,453
Health Care Equipment & Supplies - 4.1%
Advanced Medical Optics, Inc. (a)	326,200		13,419,868
Advanced Neuromodulation Systems, Inc. (a)	455,550		17,976,003
Alcon, Inc.	890,500		71,774,300
American Medical Systems Holdings, Inc. (a)	225,900		9,444,879
Arrow International, Inc.	14,300		443,157
Aspect Medical Systems, Inc. (a)	105,400		2,578,084
Becton, Dickinson & Co.	90,800		5,157,440
Bio-Rad Laboratories, Inc. Class A (a)	211,100		12,110,807
Boston Scientific Corp. (a)	169,700		6,032,835
C.R. Bard, Inc.	434,400		27,792,912
Cooper Companies, Inc.	191,560		13,522,220
Cytyc Corp. (a)	94,100		2,594,337
DENTSPLY International, Inc.	1,612,862		90,642,844
Edwards Lifesciences Corp. (a)	22,500		928,350
Fisher Scientific International, Inc. (a)	390,847		24,381,036
Foxhollow Technologies, Inc.	8,900		218,851
Given Imaging Ltd. (a)(d)	91,100		3,271,401
Guidant Corp.	33,700		2,429,770
IDEXX Laboratories, Inc. (a)	306,970		16,757,492
Integra LifeSciences Holdings Corp. (a)	217,400		8,028,582
IntraLase Corp.	32,700		767,796
Intuitive Surgical, Inc. (a)	181,700		7,271,634
Kinetic Concepts, Inc.	226,200		17,259,060
Lumenis Ltd. (a)	237		460
Medtronic, Inc.	123,640		6,141,199
Nobel Biocare Holding AG (Switzerland)	44,934		8,123,572
Ocular Sciences, Inc. (a)	136,820		6,705,548
Smith & Nephew PLC	4,548,003		47,080,927
St. Jude Medical, Inc. (a)	1,009,252		42,317,936
Symmetry Medical, Inc.	40,400		850,420
Synthes, Inc.	162,877		18,225,300
Thermo Electron Corp. (a)	78,800		2,378,972
Varian Medical Systems, Inc. (a)	2,300		99,452
Ventana Medical Systems, Inc. (a)	11,200		716,688
Waters Corp. (a)	470,000		21,991,300
Zimmer Holdings, Inc. (a)	279,771		22,415,253
			531,850,685
Health Care Providers & Services - 3.2%
Aetna, Inc.	899,300		112,187,675
American Healthways, Inc. (a)	132,600		4,381,104

	Shares		Value (Note 1)
Caremark Rx, Inc. (a)	62,100		$ 2,448,603
DaVita, Inc. (a)	44,600		1,763,038
eResearchTechnology, Inc. (a)	218,224		3,458,850
IDX Systems Corp. (a)	11,000		379,060
Merge Technologies, Inc. (a)	350,000		7,787,500
Molina Healthcare, Inc. (a)	49,460		2,293,955
Patterson Companies, Inc. (a)	3,608,004		156,551,294
Pharmaceutical Product Development, Inc. (a)	67,800		2,799,462
UnitedHealth Group, Inc.	1,243,310		109,448,579
VCA Antech, Inc. (a)	231,000		4,527,600
WellChoice, Inc. (a)	11,800		630,120
WellPoint, Inc. (a)	22,300		2,564,500
			411,221,340
Pharmaceuticals - 2.2%
Atherogenics, Inc. (a)	67,400		1,587,944
Connetics Corp. (a)	87,100		2,115,659
Cypress Bioscience, Inc. (a)	226,000		3,177,560
Elan Corp. PLC sponsored ADR (a)	577,000		15,723,250
Johnson & Johnson	492,150		31,212,153
Kos Pharmaceuticals, Inc. (a)	150,800		5,676,112
Merck KGaA	28,908		1,985,071
Novartis AG sponsored ADR	709,000		35,832,860
Novo Nordisk AS Series B	1,298,974		70,841,066
Pfizer, Inc.	265		7,126
Roche Holding AG (participation certificate)	701,730		80,183,638
Schering-Plough Corp.	1,404,000		29,315,520
Teva Pharmaceutical Industries Ltd. sponsored ADR	91,200		2,723,232
			280,381,191
TOTAL HEALTH CARE			1,456,429,669
INDUSTRIALS - 12.1%
Aerospace & Defense - 1.1%
L-3 Communications Holdings, Inc.	155,700		11,403,468
Lockheed Martin Corp.	1,784,635		99,136,474
Precision Castparts Corp.	230,886		15,164,592
SI International, Inc. (a)	118,300		3,638,908
United Technologies Corp.	86,900		8,981,115
			138,324,557
Air Freight & Logistics - 1.3%
C.H. Robinson Worldwide, Inc.	1,162,280		64,529,786
CNF, Inc.	47,500		2,379,750
EGL, Inc. (a)	248,200		7,418,698
Expeditors International of Washington, Inc.	48,900		2,732,532
Ryder System, Inc.	45,200		2,159,204
United Parcel Service, Inc. Class B	955,600		81,665,576
UTI Worldwide, Inc.	16,900		1,149,538
			162,035,084
Common Stocks - continued
	Shares		Value (Note 1)
INDUSTRIALS - continued
Airlines - 0.8%
JetBlue Airways Corp. (a)	1,108,643		$ 25,742,690
Ryanair Holdings PLC sponsored ADR (a)(d)	1,533,751		62,500,353
Southwest Airlines Co.	846,217		13,776,413
			102,019,456
Building Products - 0.3%
Lennox International, Inc.	212,500		4,324,375
Masco Corp.	837,000		30,575,610
Trex Co., Inc. (a)	53,000		2,779,320
			37,679,305
Commercial Services & Supplies - 0.6%
ABM Industries, Inc.	26,300		518,636
Apollo Group, Inc. Class A (a)	72		5,811
Aramark Corp. Class B	917,050		24,310,996
Corporate Executive Board Co.	62,100		4,156,974
Educate, Inc.	267,600		3,543,024
Jackson Hewitt Tax Service, Inc.	55,400		1,398,850
Laureate Education, Inc. (a)	175,100		7,720,159
Navigant Consulting, Inc. (a)	58,100		1,545,460
R.R. Donnelley & Sons Co.	316,100		11,155,169
Resources Connection, Inc. (a)	294,000		15,967,140
Robert Half International, Inc.	430,200		12,660,786
			82,983,005
Construction & Engineering - 0.1%
Jacobs Engineering Group, Inc. (a)	239,620		11,451,440
Paul Y-ITC Construction Holdings Ltd.	6,732,000		1,706,211
			13,157,651
Electrical Equipment - 0.5%
AMETEK, Inc.	73,900		2,636,013
Cooper Industries Ltd. Class A	759,500		51,562,455
Energy Conversion Devices, Inc. (a)	67,900		1,311,828
Roper Industries, Inc.	94,900		5,767,073
Ultralife Batteries, Inc. (a)	306,920		5,969,594
			67,246,963
Industrial Conglomerates - 2.8%
3M Co.	3,794,320		311,399,842
Carlisle Companies, Inc.	55,700		3,616,044
Hutchison Whampoa Ltd.	1,823,000		17,062,481
Siemens AG sponsored ADR	157,600		13,343,992
Tyco International Ltd.	465,500		16,636,970
			362,059,329
Machinery - 3.6%
A.S.V., Inc. (a)	93,064		4,457,766
Bucyrus International, Inc. Class A	238,300		9,684,512
Caterpillar, Inc.	201,400		19,638,514
Cummins, Inc.	423,000		35,443,170
CUNO, Inc. (a)	45,100		2,678,940
Danaher Corp. (d)	2,807,760		161,193,502

	Shares		Value (Note 1)
Deere & Co.	144,600		$ 10,758,240
Eaton Corp.	100,300		7,257,708
ESCO Technologies, Inc. (a)	45,100		3,456,915
Gardner Denver, Inc. (a)	34,500		1,252,005
Harsco Corp.	65,700		3,662,118
IDEX Corp.	124,500		5,042,250
Illinois Tool Works, Inc.	39,900		3,697,932
Ingersoll-Rand Co. Ltd. Class A	134,000		10,760,200
ITT Industries, Inc.	28,000		2,364,600
Joy Global, Inc.	381,935		16,587,437
Oshkosh Truck Co.	78,000		5,333,640
PACCAR, Inc.	1,209,244		97,319,957
Pall Corp.	88,400		2,559,180
Parker Hannifin Corp.	189,900		14,383,026
Pentair, Inc.	64,800		2,822,688
Timken Co.	52,200		1,358,244
Volvo AB ADR	889,100		35,252,815
			456,965,359
Marine - 0.0%
Alexander & Baldwin, Inc.	59,199		2,511,222
Road & Rail - 0.8%
Burlington Northern Santa Fe Corp.	360,400		17,050,524
Canadian National Railway Co.	378,600		23,053,585
Heartland Express, Inc.	571,226		12,835,448
Knight Transportation, Inc.	306,520		7,601,696
Laidlaw International, Inc. (a)	96,600		2,067,240
Landstar System, Inc. (a)	282,812		20,826,276
Norfolk Southern Corp.	67,500		2,442,825
Yellow Roadway Corp. (a)(d)	251,687		14,021,483
			99,899,077
Trading Companies & Distributors - 0.2%
Fastenal Co.	228,112		14,042,575
MSC Industrial Direct Co., Inc. Class A	387,900		13,956,642
			27,999,217
Transportation Infrastructure - 0.0%
International Shipping Enterprises, Inc. unit	674,400		4,451,040
TOTAL INDUSTRIALS			1,557,331,265
INFORMATION TECHNOLOGY - 15.0%
Communications Equipment - 2.7%
Carrier Access Corp. (a)	55,000		587,400
Comverse Technology, Inc. (a)	474,900		11,611,305
Ditech Communications Corp. (a)	521,800		7,800,910
Finisar Corp. (a)	185,600		423,168
Harris Corp.	518,000		32,007,220
Juniper Networks, Inc. (a)	575,305		15,642,543
Lucent Technologies, Inc. warrants 12/10/07 (a)	24,604		38,874
Motorola, Inc.	637,065		10,957,518
Plantronics, Inc.	245,600		10,185,032
Common Stocks - continued
	Shares		Value (Note 1)
INFORMATION TECHNOLOGY - continued
Communications Equipment - continued
QUALCOMM, Inc.	2,658,700		$ 112,728,880
Research In Motion Ltd. (a)	1,239,700		102,047,972
Scientific-Atlanta, Inc.	233,900		7,721,039
Telefonaktiebolaget LM Ericsson ADR (a)	1,050,609		33,083,677
			344,835,538
Computers & Peripherals - 0.9%
Apple Computer, Inc. (a)	546,400		35,188,160
Avid Technology, Inc. (a)	43,300		2,673,775
Dell, Inc. (a)	1,263,800		53,256,532
NCR Corp. (a)	173,100		11,983,713
Network Appliance, Inc. (a)	156,200		5,188,964
Novatel Wireless, Inc.	223,100		4,323,678
Storage Technology Corp. (a)	16,400		518,404
Synaptics, Inc. (a)	98,336		3,007,115
			116,140,341
Electronic Equipment & Instruments - 0.8%
Amphenol Corp. Class A (a)	457,900		16,823,246
Cogent, Inc.	262,309		8,656,197
Dionex Corp. (a)	33,100		1,875,777
FARO Technologies, Inc. (a)	65,532		2,043,288
FLIR Systems, Inc. (a)	816,000		52,052,640
Hon Hai Precision Industries Co. Ltd.	2,885,000		13,340,516
National Instruments Corp.	246,457		6,715,953
Symbol Technologies, Inc.	102,100		1,766,330
Trimble Navigation Ltd. (a)	82,700		2,732,408
			106,006,355
Internet Software & Services - 2.9%
Akamai Technologies, Inc. (a)	1,401,383		18,260,020
Digital River, Inc. (a)	254,104		10,573,267
Google, Inc. Class A	383,343		74,023,533
Housevalues, Inc.	25,100		377,002
InfoSpace, Inc. (a)	134,985		6,418,537
Sina Corp. (a)	114,200		3,661,252
VeriSign, Inc. (a)	84,400		2,829,088
WebEx Communications, Inc. (a)	56,900		1,353,082
Websense, Inc. (a)	204,583		10,376,450
Yahoo!, Inc. (a)	6,539,696		246,415,745
			374,287,976
IT Services - 2.1%
Affiliated Computer Services, Inc. Class A (a)	32,600		1,962,194
Alliance Data Systems Corp. (a)	1,061,300		50,390,524
Anteon International Corp. (a)	554,200		23,198,812
Cognizant Technology Solutions Corp. Class A (a)	1,508,896		63,871,568
First Data Corp.	130,000		5,530,200
Global Payments, Inc.	45,200		2,646,008
Infosys Technologies Ltd. sponsored ADR (d)	1,011,600		70,113,996

	Shares		Value (Note 1)
Iron Mountain, Inc. (a)	410,900		$ 12,528,341
Kanbay International, Inc.	144,300		4,516,590
SRA International, Inc. Class A (a)	472,800		30,353,760
			265,111,993
Office Electronics - 0.2%
Canon, Inc.	91,500		4,964,790
Xerox Corp. (a)	723,549		12,307,568
Zebra Technologies Corp. Class A (a)	227,970		12,830,152
			30,102,510
Semiconductors & Semiconductor Equipment - 3.7%
Advanced Micro Devices, Inc. (a)	546,100		12,025,122
Analog Devices, Inc.	1,338,100		49,402,652
ATI Technologies, Inc. (a)	343,100		6,650,422
Cree, Inc. (a)	515,700		20,669,256
FormFactor, Inc. (a)	83,700		2,271,618
Freescale Semiconductor, Inc. Class B	85,810		1,575,472
International Rectifier Corp. (a)	770,900		34,359,013
Lam Research Corp. (a)	42,900		1,240,239
Linear Technology Corp.	101,100		3,918,636
Marvell Technology Group Ltd. (a)	4,508,800		159,927,136
Samsung Electronics Co. Ltd.	335,500		146,003,443
Sigmatel, Inc. (a)	136,400		4,846,292
Silicon Image, Inc. (a)	530,500		8,732,030
Silicon Laboratories, Inc. (a)	386,226		13,637,640
Tessera Technologies, Inc. (a)	364,500		13,563,045
Volterra Semiconductor Corp. (d)	105,800		2,343,999
			481,166,015
Software - 1.7%
Activision, Inc. (a)	335,399		6,768,352
Adobe Systems, Inc.	648,589		40,692,474
Altiris, Inc. (a)	761,839		26,991,956
Autodesk, Inc.	711,500		27,001,425
Cadence Design Systems, Inc. (a)	83,400		1,151,754
Cognos, Inc. (a)	285,300		12,557,955
Computer Associates International, Inc.	4,831		150,051
Kronos, Inc. (a)	75,692		3,870,132
Macrovision Corp. (a)	96,300		2,476,836
Microsoft Corp.	334,600		8,937,166
NAVTEQ Corp.	235,000		10,894,600
Quality Systems, Inc. (a)	51,193		3,061,341
Quest Software, Inc. (a)	67,400		1,075,030
Red Hat, Inc. (a)	179,167		2,391,879
SAP AG sponsored ADR	107,500		4,752,575
Sonic Solutions, Inc. (a)(d)	512,799		11,507,210
Symantec Corp. (a)	1,809,998		46,625,548
Take-Two Interactive Software, Inc. (a)	100,000		3,479,000
THQ, Inc. (a)	78,200		1,793,908
TIBCO Software, Inc. (a)	252,205		3,364,415
			219,543,607
TOTAL INFORMATION TECHNOLOGY			1,937,194,335
Common Stocks - continued
	Shares		Value (Note 1)
MATERIALS - 8.0%
Chemicals - 1.4%
Agrium, Inc.	112,500		$ 1,898,438
Bayer AG	135,300		4,597,494
Dow Chemical Co.	270,200		13,377,602
Ecolab, Inc.	1,696,800		59,608,584
Headwaters, Inc. (a)	124,800		3,556,800
Methanex Corp.	378,200		6,905,302
Monsanto Co.	90,100		5,005,055
Nalco Holding Co.	396,800		7,745,536
NOVA Chemicals Corp.	473,900		22,391,775
Potash Corp. of Saskatchewan	622,700		51,761,938
Westlake Chemical Corp.	56,400		1,883,760
			178,732,284
Construction Materials - 0.2%
Eagle Materials, Inc.	101,700		8,781,795
Eagle Materials, Inc. Class B	7,000		590,100
Lafarge North America, Inc.	45,309		2,325,258
Rinker Group Ltd.	685,302		5,710,320
Texas Industries, Inc.	65,700		4,098,366
Vulcan Materials Co.	43,500		2,375,535
			23,881,374
Containers & Packaging - 0.2%
Ball Corp.	152,756		6,718,209
Owens-Illinois, Inc. (a)	952,100		21,565,065
Peak International Ltd. (a)	200,000		818,800
			29,102,074
Metals & Mining - 6.2%
Aber Diamond Corp.	611,150		21,619,432
Agnico-Eagle Mines Ltd.	369,600		5,088,160
Alumina Ltd.	1,152,300		5,355,264
Anglo American PLC ADR (d)	1,343,472		31,961,199
Apex Silver Mines Ltd. (a)	550,100		9,450,718
BHP Billiton Ltd. sponsored ADR	1,363,000		32,739,260
Caemi Mineracao E Metalurgia SA (PN) (a)	5,132,000		4,405,482
Carpenter Technology Corp.	212,100		12,399,366
Cleveland-Cliffs, Inc.	48,400		5,026,824
Companhia Vale do Rio Doce sponsored ADR	961,000		27,878,610
Compania de Minas Buenaventura SA sponsored ADR	881,800		20,193,220
Compass Minerals International, Inc.	223,500		5,415,405
Dofasco, Inc.	195,500		7,396,417
Eldorado Gold Corp. (a)	1,772,700		5,244,238
Falconbridge Ltd.	90,400		2,342,867
First Quantum Minerals Ltd. (a)	324,600		5,044,825
Fording Canadian Coal Trust (d)	16,900		1,305,103
Fortescue Metals Group Ltd. (a)(d)	304,600		643,461
Freeport-McMoRan Copper & Gold, Inc. Class B	839,734		32,103,031
Gabriel Resources Ltd. (a)	2,171,800		2,823,340

	Shares		Value (Note 1)
Gerdau SA sponsored ADR	173,200		$ 3,117,600
Glamis Gold Ltd. (a)(d)	2,463,000		42,199,400
Goldcorp, Inc.	3,809,466		57,332,463
Inco Ltd. (a)	67,800		2,486,000
International Steel Group, Inc.	395,600		16,045,536
IPSCO, Inc.	757,400		36,172,162
Ivanhoe Mines Ltd. (a)	933,000		6,725,375
Lionore Mining International Ltd. (a)	1,329,000		7,597,450
Meridian Gold, Inc. (a)	304,600		5,772,170
Mittal Steel Co. NV Class A (NY Shares) (a)	156,000		6,029,400
Newcrest Mining Ltd.	791,800		10,810,350
Newmont Mining Corp.	2,872,651		127,574,431
Novagold Resources, Inc. (a)	778,300		6,064,254
Nucor Corp.	906,900		47,467,146
Peabody Energy Corp.	210,800		17,055,828
Phelps Dodge Corp.	77,900		7,705,868
Placer Dome, Inc.	1,054,900		19,849,702
POSCO sponsored ADR (d)	677,000		30,146,810
Quanex Corp.	36,000		2,468,520
Rio Tinto PLC (Reg.)	2,049,269		61,073,339
Southern African Resources PLC (a)	8,549,418		6,234,569
Steel Dynamics, Inc.	108,314		4,102,934
Teck Cominco Ltd. Class B (sub. vtg.)	212,200		6,528,687
United States Steel Corp.	342,300		17,542,875
Usinas Siderurgicas de Minas Gerais SA (Usiminas) (PN-A)	56,200		1,139,235
Wheaton River Minerals Ltd. (a)	905,300		2,942,225
Xstrata PLC	472,400		8,449,132
Yanzhou Coal Mining Co. Ltd. (H Shares) (a)	1,548,000		2,210,632
			801,280,315
Paper & Forest Products - 0.0%
Votorantim Celulose e Papel SA sponsored ADR (non-vtg.)	35,600		576,720
TOTAL MATERIALS			1,033,572,767
TELECOMMUNICATION SERVICES - 4.3%
Diversified Telecommunication Services - 0.1%
Citizens Communications Co.	611,300		8,429,827
PT Indosat Tbk	3,790,000		2,350,866
PT Indosat Tbk sponsored ADR	126,600		3,947,388
PT Telkomunikasi Indonesia Tbk sponsored ADR	54,600		1,147,692
			15,875,773
Wireless Telecommunication Services - 4.2%
Alamosa Holdings, Inc. (a)	176,600		2,202,202
America Movil SA de CV sponsored ADR	2,209,800		115,683,030
KDDI Corp.	1,548		8,342,244
Millicom International Cellular SA (a)	62,200		1,413,806
mmO2 PLC (a)	898,900		2,117,479
Common Stocks - continued
	Shares		Value (Note 1)
TELECOMMUNICATION SERVICES - continued
Wireless Telecommunication Services - continued
Mobile TeleSystems OJSC sponsored ADR (d)	71,200		$ 9,861,912
MTN Group Ltd.	447,300		3,434,635
Nextel Communications, Inc. Class A (a)	4,985,700		149,571,000
Nextel Partners, Inc. Class A (a)	2,508,400		49,014,136
NII Holdings, Inc. (a)	1,002,853		47,585,375
Telefonica Moviles SA sponsored ADR	193,400		2,458,114
Telesystem International Wireless, Inc. (a)	1,197,700		13,424,221
Turkcell Iletisim Hizmet AS sponsored ADR	229,800		4,159,380
Vimpel Communications sponsored ADR (a)	1,135,700		41,044,198
Vodafone Group PLC sponsored ADR	2,807,800		76,877,564
Western Wireless Corp. Class A (a)	299,500		8,775,350
			535,964,646
TOTAL TELECOMMUNICATION SERVICES			551,840,419
UTILITIES - 0.6%
Electric Utilities - 0.4%
Entergy Corp.	180,900		12,227,031
Exelon Corp.	242,300		10,678,161
PG&E Corp. (a)	417,100		13,881,088
TXU Corp.	133,100		8,592,936
			45,379,216
Gas Utilities - 0.0%
Southern Union Co. (a)	236,445		5,669,951
Multi-Utilities & Unregulated Power - 0.2%
AES Corp. (a)	406,800		5,560,956
Dominion Resources, Inc.	36,600		2,479,284
Duke Energy Corp.	236,700		5,995,611
NRG Energy, Inc. (a)	208,200		7,505,610
			21,541,461
TOTAL UTILITIES			72,590,628
TOTAL COMMON STOCKS (Cost $7,826,577,138)		11,590,928,561

Corporate Bonds - 0.1%
		Principal Amount
Convertible Bonds - 0.1%
INDUSTRIALS - 0.1%
Industrial Conglomerates - 0.1%
Tyco International Group SA yankee 3.125% 1/15/23		$ 3,140,000		5,282,108

		Principal Amount		Value (Note 1)
UTILITIES - 0.0%
Multi-Utilities & Unregulated Power - 0.0%
AES Corp. 4.5% 8/15/05		$ 2,280,000		$ 2,280,000
TOTAL CONVERTIBLE BONDS				7,562,108
Nonconvertible Bonds - 0.0%
TELECOMMUNICATION SERVICES - 0.0%
Diversified Telecommunication Services - 0.0%
Cable & Wireless International Finance 8.625% 3/25/19	GBP	1,160,000		2,487,665
TOTAL CORPORATE BONDS (Cost $9,206,213)			10,049,773
U.S. Treasury Obligations - 1.5%

U.S. Treasury Bills, yield at date of purchase 1.7% 1/13/05		500,000		499,756
U.S. Treasury Notes:
4.25% 8/15/13		55,175,000		55,610,386
4.25% 11/15/13		55,850,000		56,201,241
4.25% 8/15/14		22,500,000		22,550,108
4.75% 5/15/14		52,600,000		54,814,933
TOTAL U.S. TREASURY OBLIGATIONS (Cost $185,540,348)			189,676,424
Money Market Funds - 10.7%
		Shares
Fidelity Cash Central Fund, 2.24% (b)		1,097,199,284		1,097,199,284
Fidelity Securities Lending Cash Central Fund, 2.23% (b)(c)		287,986,287		287,986,287
TOTAL MONEY MARKET FUNDS (Cost $1,385,185,571)			1,385,185,571
TOTAL INVESTMENT PORTFOLIO - 102.3% (Cost $9,406,509,270)				13,175,840,329
NET OTHER ASSETS - (2.3)%				(290,550,456)
NET ASSETS - 100%			$ 12,885,289,873

Currency Abbreviations
GBP	-	British pound

Legend

(a) Non-income producing

(b) Affiliated fund that is available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete listing of the fund's holdings as of its most recent fiscal year end is available upon request.

(d) Security or a portion of the security is on loan at period end.

Other Information

Distribution of investments by country of issue, as a percentage of total net assets, is as follows:

United States of America	74.9%
Canada	6.4%
United Kingdom	4.3%
Bermuda	3.6%
Switzerland	1.6%
Korea (South)	1.3%
Others (individually less than 1%)	7.9%
	100.0%

Income Tax Information

At December 31, 2004, the fund had a capital loss carryforward of approximately $704,454,000 of which $40,895,000 and $663,559,000 will expire on December 31, 2009 and 2010, respectively.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products: Contrafund Portfolio

Financial Statements

Statement of Assets and Liabilities

December 31, 2004
Assets
Investment in securities, at value (including securities loaned of $280,743,709) (cost $9,406,509,270) - See accompanying schedule		$ 13,175,840,329
Foreign currency held at value (cost $3,367,791)		3,382,765
Receivable for investments sold		18,602,752
Receivable for fund shares sold		4,359,470
Dividends receivable		10,377,567
Interest receivable		4,062,015
Prepaid expenses		43,240
Other affiliated receivables		14,513
Other receivables		954,425
Total assets		13,217,637,076
Liabilities
Payable to custodian bank	$ 214,158
Payable for investments purchased	24,932,646
Payable for fund shares redeemed	10,394,915
Accrued management fee	6,037,675
Distribution fees payable	504,757
Other affiliated payables	920,048
Other payables and accrued expenses	1,356,717
Collateral on securities loaned, at value	287,986,287
Total liabilities		332,347,203
Net Assets		$ 12,885,289,873
Net Assets consist of:
Paid in capital		$ 9,804,776,776
Undistributed net investment income		30,613,930
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions		(719,494,071)
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies		3,769,393,238
Net Assets		$ 12,885,289,873
Initial Class: Net Asset Value, offering price and redemption price per share ($9,127,615,529 ÷ 342,907,819 shares)		$ 26.62
Service Class: Net Asset Value, offering price and redemption price per share ($2,111,968,890 ÷ 79,600,881 shares)		$ 26.53
Service Class 2: Net Asset Value, offering price and redemption price per share ($1,638,617,401 ÷62,190,060 shares)		$ 26.35
Service Class 2R: Net Asset Value, offering price and redemption price per share ($7,088,053 ÷ 269,583 shares)		$ 26.29

Statement of Operations

Year ended December 31, 2004

Investment Income
Dividends		$ 91,348,934
Interest		19,310,973
Security lending		2,018,912
Total income		112,678,819

Expenses
Management fee	$ 64,250,053
Transfer agent fees	7,478,200
Distribution fees	4,881,463
Accounting and security lending fees	1,462,803
Non-interested trustees' compensation	60,631
Appreciation in deferred trustee compensation account	6,782
Custodian fees and expenses	744,204
Registration fees	18,266
Audit	88,634
Legal	29,125
Miscellaneous	1,675,041
Total expenses before reductions	80,695,202
Expense reductions	(2,471,388)	78,223,814
Net investment income (loss)		34,455,005
Realized and Unrealized Gain (Loss) Net realized gain (loss) on:
Investment securities	555,405,871
Foreign currency transactions	153,799
Futures contracts	608,071
Total net realized gain (loss)		556,167,741
Change in net unrealized appreciation (depreciation) on: Investment securities	1,080,157,253
Assets and liabilities in foreign currencies	(392,470)
Futures contracts	(739,135)
Total change in net unrealized appreciation (depreciation)		1,079,025,648
Net gain (loss)		1,635,193,389
Net increase (decrease) in net assets resulting from operations		$ 1,669,648,394

See accompanying notes which are an integral part of the financial statements.

Annual Report

Statement of Changes in Net Assets

	Year ended December 31, 2004	Year ended December 31, 2003
Increase (Decrease) in Net Assets
Operations
Net investment income (loss)	$ 34,455,005	$ 25,801,059
Net realized gain (loss)	556,167,741	98,601,973
Change in net unrealized appreciation (depreciation)	1,079,025,648	2,069,862,306
Net increase (decrease) in net assets resulting from operations	1,669,648,394	2,194,265,338
Distributions to shareholders from net investment income	(33,283,266)	(35,507,037)
Share transactions - net increase (decrease)	974,982,321	535,497,703
Redemption fees	5,434	3,718
Total increase (decrease) in net assets	2,611,352,883	2,694,259,722

Net Assets
Beginning of period	10,273,936,990	7,579,677,268
End of period (including undistributed net investment income of $30,613,930 and undistributed net investment income of $23,673,410, respectively)	$ 12,885,289,873	$ 10,273,936,990

Other Information:
Share Transactions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2	Service Class 2R
Shares Sold	39,676,965	15,203,443	27,599,342	256,799
Reinvested	1,123,479	189,967	89,389	356
Redeemed	(29,262,778)	(9,311,680)	(5,203,844)	(105,684)
Net increase (decrease)	11,537,666	6,081,730	22,484,887	151,471

Dollars Sold	$ 959,621,838	$ 366,229,990	$ 660,559,920	$ 6,150,098
Reinvested	26,671,383	4,498,414	2,105,112	8,357
Redeemed	(701,529,337)	(223,414,420)	(123,399,434)	(2,519,600)
Net increase (decrease)	$ 284,763,884	$ 147,313,984	$ 539,265,598	$ 3,638,855

Share Transactions	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2	Service Class 2R
Shares Sold	43,575,507	16,391,007	21,425,743	119,703
Reinvested	1,718,846	269,021	92,062	161
Redeemed	(43,003,502)	(8,751,544)	(6,273,261)	(46,848)
Net increase (decrease)	2,290,851	7,908,484	15,244,544	73,016

Dollars Sold	$ 877,441,120	$ 326,586,457	$ 422,566,799	$ 2,529,458
Reinvested	29,357,892	4,584,117	1,562,295	2,733
Redeemed	(837,322,380)	(169,383,155)	(121,521,459)	(906,174)
Net increase (decrease)	$ 69,476,632	$ 161,787,419	$ 302,607,635	$ 1,626,017

Distributions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2	Service Class 2R
From net investment income	$ 26,671,383	$ 4,498,414	$ 2,105,112	$ 8,357
	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2	Service Class 2R
From net investment income	$ 29,357,892	$ 4,584,117	$ 1,562,295	$ 2,733

See accompanying notes which are an integral part of the financial statements.

Contrafund Portfolio

Financial Highlights - Initial Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 23.13	$ 18.10	$ 20.13	$ 23.75	$ 29.15
Income from Investment Operations
Net investment income (loss)^C	.08	.07	.10	.16	.17
Net realized and unrealized gain (loss)	3.49	5.05	(1.97)	(3.01)	(1.84)
Total from investment operations	3.57	5.12	(1.87)	(2.85)	(1.67)
Distributions from net investment income	(.08)	(.09)	(.16)	(.17)	(.11)
Distributions from net realized gain	-	-	-	(.60)	(3.62)
Total distributions	(.08)	(.09)	(.16)	(.77)	(3.73)
Redemption fees added to paid in capital^{C, E}	-	-	-	-	-
Net asset value, end of period	$ 26.62	$ 23.13	$ 18.10	$ 20.13	$ 23.75
Total Return^{A, B}	15.48%	28.46%	(9.35)%	(12.28)%	(6.58)%
Ratios to Average Net Assets^D
Expenses before expense reductions	.68%	.67%	.68%	.68%	.66%
Expenses net of voluntary waivers, if any	.68%	.67%	.68%	.68%	.66%
Expenses net of all reductions	.66%	.65%	.64%	.64%	.63%
Net investment income (loss)	.35%	.34%	.50%	.77%	.69%
Supplemental Data
Net assets, end of period (000 omitted)	$ 9,127,616	$ 7,665,424	$ 5,956,028	$ 6,972,615	$ 8,516,464
Portfolio turnover rate	64%	66%	84%	140%	177%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^D Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of any voluntary waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.

^E Amount represents less than $.01 per share.

Financial Highlights - Service Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 23.06	$ 18.04	$ 20.06	$ 23.67	$ 29.10
Income from Investment Operations
Net investment income (loss)^C	.06	.05	.08	.14	.15
Net realized and unrealized gain (loss)	3.47	5.04	(1.96)	(3.00)	(1.85)
Total from investment operations	3.53	5.09	(1.88)	(2.86)	(1.70)
Distributions from net investment income	(.06)	(.07)	(.14)	(.15)	(.11)
Distributions from net realized gain	-	-	-	(.60)	(3.62)
Total distributions	(.06)	(.07)	(.14)	(.75)	(3.73)
Redemption fees added to paid in capital^{C, E}	-	-	-	-	-
Net asset value, end of period	$ 26.53	$ 23.06	$ 18.04	$ 20.06	$ 23.67
Total Return^{A, B}	15.34%	28.35%	(9.42)%	(12.36)%	(6.71)%
Ratios to Average Net Assets^D
Expenses before expense reductions	.78%	.77%	.78%	.78%	.76%
Expenses net of voluntary waivers, if any	.78%	.77%	.78%	.78%	.76%
Expenses net of all reductions	.76%	.75%	.74%	.74%	.74%
Net investment income (loss)	.25%	.24%	.39%	.67%	.59%
Supplemental Data
Net assets, end of period (000 omitted)	$ 2,111,969	$ 1,695,467	$ 1,183,683	$ 1,201,105	$ 1,245,222
Portfolio turnover rate	64%	66%	84%	140%	177%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^E Amount represents less than $.01 per share.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Service Class 2

Years ended December 31,	2004	2003	2002	2001	2000^F
Selected Per-Share Data
Net asset value, beginning of period	$ 22.93	$ 17.95	$ 20.00	$ 23.64	$ 28.20
Income from Investment Operations
Net investment income (loss)^E	.02	.02	.05	.10	.10
Net realized and unrealized gain (loss)	3.45	5.02	(1.96)	(2.98)	(.93)
Total from investment operations	3.47	5.04	(1.91)	(2.88)	(.83)
Distributions from net investment income	(.05)	(.06)	(.14)	(.16)	(.11)
Distributions from net realized gain	-	-	-	(.60)	(3.62)
Total distributions	(.05)	(.06)	(.14)	(.76)	(3.73)
Redemption fees added to paid in capital^{E, H}	-	-	-	-	-
Net asset value, end of period	$ 26.35	$ 22.93	$ 17.95	$ 20.00	$ 23.64
Total Return^{B, C, D}	15.16%	28.20%	(9.60)%	(12.47)%	(3.86)%
Ratios to Average Net Assets^G
Expenses before expense reductions	.93%	.93%	.93%	.94%	.92%^A
Expenses net of voluntary waivers, if any	.93%	.93%	.93%	.94%	.92%^A
Expenses net of all reductions	.91%	.90%	.90%	.90%	.90%^A
Net investment income (loss)	.10%	.09%	.24%	.52%	.43%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 1,638,617	$ 910,341	$ 439,157	$ 231,686	$ 81,950
Portfolio turnover rate	64%	66%	84%	140%	177%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F For the period January 12, 2000 (commencement of sale of shares) to December 31, 2000.

^G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of any voluntary waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.

^H Amount represents less than $.01 per share.

Financial Highlights - Service Class 2R

Years ended December 31,	2004	2003	2002^F
Selected Per-Share Data
Net asset value, beginning of period	$ 22.90	$ 17.95	$ 20.49
Income from Investment Operations
Net investment income (loss)^E	.02	.02	.03
Net realized and unrealized gain (loss)	3.44	5.01	(2.57)
Total from investment operations	3.46	5.03	(2.54)
Distributions from net investment income	(.07)	(.08)	-
Redemption fees added to paid in capital^{E, H}	-	-	-
Net asset value, end of period	$ 26.29	$ 22.90	$ 17.95
Total Return^{B, C, D}	15.15%	28.18%	(12.40)%
Ratios to Average Net Assets^G
Expenses before expense reductions	.93%	.93%	.96%^A
Expenses net of voluntary waivers, if any	.93%	.93%	.96%^A
Expenses net of all reductions	.91%	.90%	.92%^A
Net investment income (loss)	.10%	.08%	.23%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 7,088	$ 2,705	$ 810
Portfolio turnover rate	64%	66%	84%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F For the period April 24, 2002 (commencement of sale of shares) to December 31, 2002.

^H Amount represents less than $.01 per share.

See accompanying notes which are an integral part of the financial statements.

Contrafund Portfolio

Fidelity Variable Insurance Products: Equity-Income Portfolio

Performance: The Bottom Line

Average annual total return reflects the change in the value of an investment, assuming reinvestment of a class' dividend income and capital gains (the profits earned upon the sale of securities that have grown in value) and assuming a constant rate of performance each year. During periods of reimbursement by Fidelity, a fund's total return will be greater than it would be had the reimbursement not occurred. Performance numbers are net of all underlying fund operating expenses, but do not include any insurance charges imposed by your insurance company's separate account. If performance information included the effect of these additional charges, the total returns would be lower. How a fund did yesterday is no guarantee of how it will do tomorrow.

Average Annual Total Returns

Periods ended December 31, 2004	Past 1 year	Past 5 years	Past 10 years
Fidelity ® VIP: Equity-Income - Initial Class	11.53%	4.46%	11.31%
Fidelity VIP: Equity-Income - Service Class^A	11.38%	4.35%	11.23%
Fidelity VIP: Equity-Income - Service Class 2^B	11.23%	4.19%	11.15%

^A The initial offering of Service Class shares took place on November 3, 1997. Performance for Service Class shares reflects an asset-based distribution fee (12b-1 fee), and returns prior to November 3, 1997 are those of Initial Class and do not include the effects of Service Class' 12b-1 fee. Had Service Class' 12b-1 fee been reflected, returns prior to November 3, 1997 would have been lower.

^B The initial offering of Service Class 2 shares took place on January 12, 2000. Performance for Service Class 2 shares reflects an asset-based distribution fee (12b-1 fee). Returns from November 3, 1997 to January 12, 2000 are those of Service Class which reflect a different 12b-1 fee. Service Class 2 returns prior to November 3, 1997 are those of Initial Class, and do not include the effects of a 12b-1 fee. Had Service Class 2 shares' 12b-1 fee been reflected, returns prior to January 12, 2000 would have been lower.

$10,000 Over 10 Years

Let's say hypothetically that $10,000 was invested in Fidelity ® Variable Insurance Products: Equity-Income Portfolio - Initial Class on December 31, 1994. The chart shows how the value of your investment would have changed, and also shows how the Russell 3000® Value Index performed over the same period.

Annual Report

Fidelity Variable Insurance Products: Equity-Income Portfolio

Management's Discussion of Fund Performance

Comments from Stephen Petersen, Portfolio Manager of Fidelity® Variable Insurance Products: Equity-Income Portfolio

For the 12-month period ending December 31, 2004, the fund underperformed the Lipper^SM Variable Annuity Equity Income Objective Funds Average, which rose 13.51%, and the Russell 3000 Value Index. Mid- and small-cap stocks continued to outperform large-caps, which - along with out-of-favor stocks - are the fund's primary focus. As a result, it did not keep pace with the Russell index, which includes stocks of all market capitalizations. The fund's performance relative to the index also was hurt by its underweighting in financial stocks. Fund holdings Pfizer and Merck were hurt by competitive pressures from generic drug makers and company-specific issues: Merck was ordered to pull its arthritis drug, Vioxx, off the shelves, causing the stock price to plummet; Pfizer, which makes arthritis drug Celebrex, took a hit over concerns about the potential for similar problems with its own product. Conversely, energy holdings Exxon Mobil and Total SA did well as crude oil prices remained high, demand grew and excess supply evaporated.

Annual Report

Fidelity Variable Insurance Products: Equity-Income Portfolio

Investment Summary

Top Five Stocks as of December 31, 2004
	% of fund's net assets
Bank of America Corp.	3.1
Exxon Mobil Corp.	3.1
Citigroup, Inc.	2.8
American International Group, Inc.	2.6
J.P. Morgan Chase & Co.	2.3
	13.9
Top Five Market Sectors as of December 31, 2004
	% of fund's net assets
Financials	30.2
Industrials	12.1
Consumer Discretionary	11.1
Energy	10.8
Health Care	7.9

Asset Allocation as of December 31, 2004
% of fund's net assets*
	Stocks	99.1%
	Bonds	0.7%
	Short-Term Investments and Net Other Assets	0.2%
* Foreign investments		11.9%

Annual Report

Fidelity Variable Insurance Products: Equity-Income Portfolio

Investments December 31, 2004

Showing Percentage of Net Assets

Common Stocks - 98.0%
	Shares		Value (Note 1)
CONSUMER DISCRETIONARY - 10.5%
Auto Components - 0.1%
TRW Automotive Holdings Corp.	611,370		$ 12,655,359
Automobiles - 0.4%
Toyota Motor Corp. ADR	475,900		38,961,933
Hotels, Restaurants & Leisure - 1.2%
Caesars Entertainment, Inc. (a)	1,927,700		38,823,878
McDonald's Corp.	2,561,300		82,115,278
Six Flags, Inc. (a)	642,256		3,448,915
Wendy's International, Inc.	128,800		5,056,688
			129,444,759
Household Durables - 1.2%
Koninklijke Philips Electronics NV (NY Shares)	601,900		15,950,350
LG Electronics, Inc.	237,410		14,700,524
Maytag Corp.	1,357,020		28,633,122
Newell Rubbermaid, Inc.	2,451,900		59,311,461
Sony Corp. sponsored ADR	128,500		5,006,360
The Stanley Works	128,500		6,295,215
			129,897,032
Leisure Equipment & Products - 0.0%
Eastman Kodak Co.	128,400		4,140,900
Media - 6.0%
Clear Channel Communications, Inc.	2,716,100		90,962,189
Comcast Corp. Class A (a)	2,852,091		94,917,588
Fox Entertainment Group, Inc. Class A (a)	577,900		18,065,154
Liberty Media Corp. Class A (a)	3,912,376		42,957,888
Liberty Media International, Inc. Class A (a)	613,999		28,385,174
The Reader's Digest Association, Inc. (non-vtg.)	1,699,003		23,633,132
Time Warner, Inc. (a)	6,982,850		135,746,604
Viacom, Inc. Class B (non-vtg.)	3,720,586		135,392,125
Vivendi Universal SA sponsored ADR (a)	904,300		29,000,901
Walt Disney Co.	2,763,400		76,822,520
			675,883,275
Multiline Retail - 0.7%
Big Lots, Inc. (a)	2,275,956		27,607,349
Dollar Tree Stores, Inc. (a)	790,100		22,660,068
Family Dollar Stores, Inc.	706,500		22,063,995
Sears, Roebuck & Co.	214,100		10,925,523
			83,256,935
Specialty Retail - 0.7%
Abercrombie & Fitch Co. Class A	128,400		6,028,380
AnnTaylor Stores Corp. (a)	1,113,050		23,963,967
Gap, Inc.	1,267,900		26,778,048
Toys 'R' Us, Inc. (a)	1,295,900		26,527,073
			83,297,468

	Shares		Value (Note 1)
Textiles, Apparel & Luxury Goods - 0.2%
Liz Claiborne, Inc.	632,940		$ 26,716,397
TOTAL CONSUMER DISCRETIONARY			1,184,254,058
CONSUMER STAPLES - 6.2%
Beverages - 0.6%
Anheuser-Busch Companies, Inc.	1,282,400		65,056,152
Food & Staples Retailing - 1.2%
Albertsons, Inc.	720,600		17,207,928
CVS Corp.	1,090,700		49,157,849
Wal-Mart Stores, Inc.	1,284,200		67,831,444
			134,197,221
Food Products - 1.0%
General Mills, Inc.	278,600		13,849,206
H.J. Heinz Co.	281,120		10,960,869
Kellogg Co.	149,800		6,690,068
Kraft Foods, Inc. Class A	943,100		33,583,791
Unilever PLC sponsored ADR	1,141,000		45,092,320
			110,176,254
Household Products - 2.0%
Colgate-Palmolive Co.	2,194,400		112,265,504
Kimberly-Clark Corp.	1,169,800		76,984,538
Procter & Gamble Co.	710,400		39,128,832
			228,378,874
Personal Products - 0.6%
Gillette Co.	1,605,120		71,877,274
Tobacco - 0.8%
Altria Group, Inc.	1,562,800		95,487,080
TOTAL CONSUMER STAPLES			705,172,855
ENERGY - 10.8%
Energy Equipment & Services - 2.4%
Baker Hughes, Inc.	1,373,800		58,620,046
BJ Services Co.	536,645		24,975,458
Halliburton Co.	708,200		27,789,768
Noble Corp. (a)	817,100		40,642,554
Schlumberger Ltd. (NY Shares)	1,768,900		118,427,855
			270,455,681
Oil & Gas - 8.4%
Apache Corp.	647,780		32,758,235
BP PLC sponsored ADR	2,459,842		143,654,773
ChevronTexaco Corp.	2,480,842		130,269,013
Exxon Mobil Corp.	6,841,236		350,681,757
Royal Dutch Petroleum Co. (NY Shares)	664,300		38,117,534
Total SA:
Series B	341,300		74,976,784
sponsored ADR	1,652,996		181,565,081
			952,023,177
TOTAL ENERGY			1,222,478,858
Common Stocks - continued
	Shares		Value (Note 1)
FINANCIALS - 29.6%
Capital Markets - 4.9%
Bank of New York Co., Inc.	3,107,200		$ 103,842,624
Charles Schwab Corp.	5,679,300		67,924,428
Credit Suisse Group sponsored ADR	610,000		25,735,900
Janus Capital Group, Inc.	2,332,400		39,207,644
LaBranche & Co., Inc. (a)(c)	517,900		4,640,384
Mellon Financial Corp.	1,716,500		53,400,315
Merrill Lynch & Co., Inc.	1,610,300		96,247,631
Morgan Stanley	2,073,600		115,126,272
Nomura Holdings, Inc.	1,853,000		26,979,681
State Street Corp.	386,200		18,970,144
			552,075,023
Commercial Banks - 7.3%
Bank of America Corp.	7,600,666		357,155,294
Comerica, Inc.	730,200		44,556,804
Lloyds TSB Group PLC	2,282,400		20,717,588
Royal Bank of Scotland Group PLC	625,547		21,031,989
State Bank of India	463,175		7,573,045
Sumitomo Mitsui Financial Group, Inc.	2,994		21,776,140
U.S. Bancorp, Delaware	1,909,838		59,816,126
Wachovia Corp.	2,934,075		154,332,345
Wells Fargo & Co.	2,176,800		135,288,120
			822,247,451
Consumer Finance - 1.3%
American Express Co.	1,542,996		86,978,685
MBNA Corp.	1,456,400		41,055,916
MoneyGram International, Inc.	1,014,600		21,448,644
			149,483,245
Diversified Financial Services - 5.5%
CIT Group, Inc.	1,049,200		48,074,344
Citigroup, Inc.	6,481,619		312,284,403
J.P. Morgan Chase & Co.	6,788,812		264,831,556
			625,190,303
Insurance - 7.7%
ACE Ltd.	2,238,115		95,679,416
Allianz AG sponsored ADR	1,115,700		14,827,653
Allstate Corp.	2,059,400		106,512,168
American International Group, Inc.	4,377,250		287,454,008
Assurant, Inc.	164,900		5,037,695
Conseco, Inc. (a)	1,262,800		25,192,860
Fondiaria-Sai Spa (c)	541,144		14,556,983
Genworth Financial, Inc. Class A	1,087,200		29,354,400
Hartford Financial Services Group, Inc.	1,104,500		76,552,895
Marsh & McLennan Companies, Inc.	793,600		26,109,440

	Shares		Value (Note 1)
Muenchener Rueckversicherungs-Gesellschaft AG (Reg.)	123,914		$ 15,204,241
Old Republic International Corp.	530,996		13,434,199
St. Paul Travelers Companies, Inc.	2,542,926		94,266,267
The Chubb Corp.	439,000		33,759,100
XL Capital Ltd. Class A	428,300		33,257,495
			871,198,820
Real Estate - 0.1%
CarrAmerica Realty Corp.	193,740		6,393,420
Thrifts & Mortgage Finance - 2.8%
Fannie Mae	2,818,100		200,676,901
Freddie Mac	717,900		52,909,230
Housing Development Finance Corp. Ltd.	1,133,500		20,155,333
MGIC Investment Corp.	195,900		13,499,469
Sovereign Bancorp, Inc.	1,371,550		30,928,453
			318,169,386
TOTAL FINANCIALS			3,344,757,648
HEALTH CARE - 7.7%
Health Care Equipment & Supplies - 1.2%
Baxter International, Inc.	3,124,600		107,923,684
Thermo Electron Corp. (a)	667,000		20,136,730
			128,060,414
Health Care Providers & Services - 1.3%
Cardinal Health, Inc.	706,100		41,059,715
HCA, Inc.	333,500		13,326,660
McKesson Corp.	1,307,500		41,133,950
Tenet Healthcare Corp. (a)	2,188,900		24,034,122
UnitedHealth Group, Inc.	334,200		29,419,626
			148,974,073
Pharmaceuticals - 5.2%
Abbott Laboratories	857,000		39,979,050
Bristol-Myers Squibb Co.	2,517,500		64,498,350
GlaxoSmithKline PLC sponsored ADR	430,600		20,406,134
Johnson & Johnson	2,077,200		131,736,024
Merck & Co., Inc.	2,683,400		86,244,476
Pfizer, Inc.	3,579,000		96,239,310
Schering-Plough Corp.	3,703,130		77,321,354
Wyeth	1,713,500		72,977,965
			589,402,663
TOTAL HEALTH CARE			866,437,150
INDUSTRIALS - 12.0%
Aerospace & Defense - 3.4%
Bombardier, Inc. Class B (sub. vtg.)	2,376,500		4,713,392
EADS NV	1,540,015		44,686,006
Honeywell International, Inc.	2,956,625		104,694,091
Lockheed Martin Corp.	1,439,400		79,958,670
Common Stocks - continued
	Shares		Value (Note 1)
INDUSTRIALS - continued
Aerospace & Defense - continued
Northrop Grumman Corp.	903,000		$ 49,087,080
Raytheon Co.	288,678		11,209,367
The Boeing Co.	865,000		44,781,050
United Technologies Corp.	379,520		39,223,392
			378,353,048
Air Freight & Logistics - 0.1%
Ryder System, Inc.	123,200		5,885,264
Airlines - 0.2%
Southwest Airlines Co.	1,586,900		25,834,732
Commercial Services & Supplies - 0.3%
Waste Management, Inc.	1,286,100		38,505,834
Construction & Engineering - 0.2%
Fluor Corp.	368,900		20,108,739
Electrical Equipment - 0.3%
Emerson Electric Co.	550,200		38,569,020
Industrial Conglomerates - 3.8%
3M Co.	342,400		28,100,768
General Electric Co.	4,291,540		156,641,210
Hutchison Whampoa Ltd.	2,304,000		21,564,430
Siemens AG sponsored ADR	248,700		21,057,429
Textron, Inc.	717,500		52,951,500
Tyco International Ltd.	4,166,646		148,915,928
			429,231,265
Machinery - 2.7%
Caterpillar, Inc.	510,300		49,759,353
Deere & Co.	193,250		14,377,800
Dover Corp.	850,600		35,674,164
Eaton Corp.	212,900		15,405,444
Illinois Tool Works, Inc.	176,200		16,330,216
Ingersoll-Rand Co. Ltd. Class A	1,043,044		83,756,433
Navistar International Corp. (a)	508,495		22,363,610
SPX Corp.	1,550,600		62,117,036
			299,784,056
Road & Rail - 1.0%
Burlington Northern Santa Fe Corp.	1,236,500		58,498,815
Union Pacific Corp.	807,900		54,331,275
			112,830,090
TOTAL INDUSTRIALS			1,349,102,048
INFORMATION TECHNOLOGY - 6.9%
Communications Equipment - 0.9%
Lucent Technologies, Inc. (a)	4,816,600		18,110,416
Lucent Technologies, Inc. warrants 12/10/07 (a)	8,328		13,158
Motorola, Inc.	3,578,112		61,543,526
Nokia Corp. sponsored ADR	1,182,000		18,521,940
			98,189,040

	Shares		Value (Note 1)
Computers & Peripherals - 1.8%
Hewlett-Packard Co.	3,850,311		$ 80,741,022
International Business Machines Corp.	868,400		85,606,872
Storage Technology Corp. (a)	710,110		22,446,577
Sun Microsystems, Inc. (a)	3,998,675		21,512,872
			210,307,343
Electronic Equipment & Instruments - 0.8%
Agilent Technologies, Inc. (a)	429,600		10,353,360
Arrow Electronics, Inc. (a)	830,900		20,190,870
Avnet, Inc. (a)	1,584,330		28,898,179
Solectron Corp. (a)	5,530,200		29,475,966
			88,918,375
IT Services - 0.1%
Ceridian Corp. (a)	780,800		14,273,024
Office Electronics - 0.3%
Xerox Corp. (a)	1,881,900		32,011,119
Semiconductors & Semiconductor Equipment - 2.1%
Analog Devices, Inc.	1,113,300		41,103,036
Applied Materials, Inc. (a)	1,369,900		23,425,290
Freescale Semiconductor, Inc. Class B	1,468,877		26,968,582
Intel Corp.	3,219,100		75,294,749
Micron Technology, Inc. (a)	1,866,200		23,047,570
National Semiconductor Corp.	235,200		4,221,840
Rohm Co. Ltd.	148,300		15,346,871
Samsung Electronics Co. Ltd.	55,670		24,226,562
Teradyne, Inc. (a)	107,400		1,833,318
			235,467,818
Software - 0.9%
Computer Associates International, Inc.	1,381		42,894
Microsoft Corp.	3,735,200		99,767,192
			99,810,086
TOTAL INFORMATION TECHNOLOGY			778,976,805
MATERIALS - 6.2%
Chemicals - 2.6%
Air Products & Chemicals, Inc.	64,300		3,727,471
Arch Chemicals, Inc.	392,800		11,304,784
Dow Chemical Co.	2,015,700		99,797,307
Eastman Chemical Co.	476,800		27,525,664
Great Lakes Chemical Corp.	650,500		18,532,745
Lubrizol Corp.	214,800		7,917,528
Lyondell Chemical Co.	2,272,593		65,723,375
Nalco Holding Co.	95,700		1,868,064
Olin Corp.	682,700		15,033,054
PolyOne Corp. (a)	1,239,100		11,226,246
Praxair, Inc.	621,624		27,444,700
			290,100,938
Common Stocks - continued
	Shares		Value (Note 1)
MATERIALS - continued
Containers & Packaging - 0.5%
Amcor Ltd.	963,600		$ 5,541,317
Smurfit-Stone Container Corp. (a)	2,515,872		46,996,489
			52,537,806
Metals & Mining - 1.8%
Alcan, Inc.	955,100		46,799,900
Alcoa, Inc.	2,616,216		82,201,507
Freeport-McMoRan Copper & Gold, Inc. Class B	820,704		31,375,514
Phelps Dodge Corp.	437,600		43,287,392
			203,664,313
Paper & Forest Products - 1.3%
Bowater, Inc. (c)	391,300		17,205,461
Georgia-Pacific Corp.	1,353,201		50,717,973
International Paper Co.	999,700		41,987,400
Weyerhaeuser Co.	610,400		41,031,088
			150,941,922
TOTAL MATERIALS			697,244,979
TELECOMMUNICATION SERVICES - 5.3%
Diversified Telecommunication Services - 4.9%
BellSouth Corp.	5,303,299		147,378,679
Qwest Communications International, Inc. (a)	3,728,500		16,554,540
SBC Communications, Inc.	7,035,993		181,317,540
Sprint Corp.	1,161,600		28,865,760
Verizon Communications, Inc.	4,370,102		177,032,832
			551,149,351
Wireless Telecommunication Services - 0.4%
Crown Castle International Corp. (a)	910,400		15,149,056
KDDI Corp.	3,028		16,318,032
Vodafone Group PLC sponsored ADR	556,500		15,236,970
			46,704,058
TOTAL TELECOMMUNICATION SERVICES			597,853,409
UTILITIES - 2.8%
Electric Utilities - 1.5%
Entergy Corp.	765,900		51,767,181
FirstEnergy Corp.	428,200		16,918,182
PG&E Corp. (a)	403,800		13,438,464
TXU Corp.	654,820		42,275,179
Wisconsin Energy Corp.	1,414,600		47,686,166
			172,085,172
Gas Utilities - 0.0%
AGL Resources, Inc.	109,500		3,639,780

	Shares		Value (Note 1)
Multi-Utilities & Unregulated Power - 1.3%
Dominion Resources, Inc.	1,305,300		$ 88,421,022
NorthWestern Energy Corp. (a)	85,500		2,394,000
Public Service Enterprise Group, Inc.	1,026,100		53,121,197
			143,936,219
TOTAL UTILITIES			319,661,171
TOTAL COMMON STOCKS (Cost $8,380,344,823)		11,065,938,981
Convertible Preferred Stocks - 1.1%

CONSUMER DISCRETIONARY - 0.2%
Automobiles - 0.1%
General Motors Corp.:
Series B, 5.25%	412,200		9,472,356
Series C, 6.25%	253,100		6,671,716
			16,144,072
Hotels, Restaurants & Leisure - 0.1%
Six Flags, Inc. 7.25% PIERS	388,400		8,603,060
TOTAL CONSUMER DISCRETIONARY			24,747,132
FINANCIALS - 0.5%
Capital Markets - 0.1%
State Street Corp. 6.75%	24,900		5,556,186
Consumer Finance - 0.2%
Ford Motor Co. Capital Trust II 6.50%	461,500		24,392,583
Insurance - 0.2%
Conseco, Inc. Series B, 5.50%	143,400		3,782,892
The Chubb Corp.:
7.00%	167,700		4,937,591
Series B, 7.00%	120,100		3,603,000
Travelers Property Casualty Corp. 4.50%	240,200		5,483,045
XL Capital Ltd. 6.50%	401,800		10,127,369
			27,933,897
TOTAL FINANCIALS			57,882,666
HEALTH CARE - 0.2%
Health Care Equipment & Supplies - 0.1%
Baxter International, Inc. 7.00%	156,900		8,811,504
Pharmaceuticals - 0.1%
Schering-Plough Corp. 6.00%	187,400		10,482,781
TOTAL HEALTH CARE			19,294,285
INFORMATION TECHNOLOGY - 0.2%
Office Electronics - 0.2%
Xerox Corp. Series C, 6.25%	145,650		21,476,675
TOTAL CONVERTIBLE PREFERRED STOCKS (Cost $116,492,275)		123,400,758
Corporate Bonds - 0.7%
	Principal Amount		Value (Note 1)
Convertible Bonds - 0.6%
CONSUMER DISCRETIONARY - 0.4%
Hotels, Restaurants & Leisure - 0.1%
Royal Caribbean Cruises Ltd. liquid yield option note 0% 2/2/21	$ 11,239,000		$ 7,192,960
Six Flags, Inc. 4.5% 5/15/15	3,640,000		4,095,000
			11,287,960
Media - 0.2%
Liberty Media Corp.3.5% 1/15/31 (d)	11,400,000		10,773,000
News America, Inc. liquid yield option note 0% 2/28/21 (d)	22,670,000		13,295,955
			24,068,955
Specialty Retail - 0.1%
Gap, Inc. 5.75% 3/15/09	8,590,000		11,417,828
TOTAL CONSUMER DISCRETIONARY			46,774,743
FINANCIALS - 0.1%
Diversified Financial Services - 0.0%
Navistar Financial Corp. 4.75% 4/1/09 (d)	2,760,000		2,821,879
Insurance - 0.1%
Loews Corp. 3.125% 9/15/07	5,340,000		5,246,550
TOTAL FINANCIALS			8,068,429
INDUSTRIALS - 0.1%
Industrial Conglomerates - 0.1%
Tyco International Group SA yankee 3.125% 1/15/23	5,220,000		8,781,084
INFORMATION TECHNOLOGY - 0.0%
Electronic Equipment & Instruments - 0.0%
Celestica, Inc. liquid yield option note 0% 8/1/20	620,000		344,100
TELECOMMUNICATION SERVICES - 0.0%
Diversified Telecommunication Services - 0.0%
Level 3 Communications, Inc. 5.25% 12/15/11 (d)	6,420,000		6,474,570
TOTAL CONVERTIBLE BONDS			70,442,926

	Principal Amount		Value (Note 1)
Nonconvertible Bonds - 0.1%
CONSUMER DISCRETIONARY - 0.0%
Media - 0.0%
XM Satellite Radio, Inc. 12% 6/15/10	$ 60,000		$ 70,800
MATERIALS - 0.1%
Chemicals - 0.1%
Hercules, Inc. 6.5% 6/30/29 unit	15,700,000		13,366,980
TOTAL NONCONVERTIBLE BONDS			13,437,780
TOTAL CORPORATE BONDS (Cost $83,532,173)		83,880,706
Money Market Funds - 0.3%
	Shares
Fidelity Cash Central Fund, 2.24% (b)	12,522,005		12,522,005
Fidelity Securities Lending Cash Central Fund, 2.23% (b)(e)	16,586,000		16,586,000
TOTAL MONEY MARKET FUNDS (Cost $29,108,005)		29,108,005

TOTAL INVESTMENT PORTFOLIO - 100.1% (Cost $8,609,477,276)		11,302,328,450
NET OTHER ASSETS - (0.1)%		(15,105,563)
NET ASSETS - 100%	$ 11,287,222,887
Security Type Abbreviations
PIERS	-	Preferred Income Equity Redeemable Securities

Legend

(a) Non-income producing

(d) Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At the period end, the value of these securities amounted to $33,365,404 or 0.3% of net assets.

(e) Includes investment made with cash collateral received from securities on loan.

Distribution of investments by country of issue, as a percentage of total net assets, is as follows:

United States of America	88.1%
France	2.6%
United Kingdom	2.4%
Japan	1.2%
Netherlands Antilles	1.1%
Others (individually less than 1%)	4.6%
	100.0%

Income Tax Information

The fund hereby designates as capital gain dividends: For dividends with respect to the taxable year ended December 31, 2004, $346,587,000 or, if different, the net capital gain of such year, and for dividends with respect to the taxable year ended December 31, 2003, $38,802,000 or, if different, the excess of (a) the net capital gain of such year, over (b) amounts previously designated as capital gain dividends with respect to such year.

See accompanying notes which are an integral part of the financial statements.

Equity-Income Portfolio

Fidelity Variable Insurance Products: Equity-Income Portfolio

Financial Statements

Statement of Assets and Liabilities

December 31, 2004
Assets
Investment in securities, at value (including securities loaned of $15,755,088) (cost $8,609,477,276) - See accompanying schedule		$ 11,302,328,450
Receivable for fund shares sold		3,091,666
Dividends receivable		15,480,610
Interest receivable		827,433
Prepaid expenses		40,772
Other affiliated receivables		47,175
Other receivables		339,933
Total assets		11,322,156,039

Liabilities
Payable for investments purchased	$ 470,842
Payable for fund shares redeemed	10,653,620
Accrued management fee	4,398,026
Distribution fees payable	385,209
Other affiliated payables	953,526
Other payables and accrued expenses	1,485,929
Collateral on securities loaned, at value	16,586,000
Total liabilities		34,933,152

Net Assets		$ 11,287,222,887
Net Assets consist of:
Paid in capital		$ 8,042,639,374
Undistributed net investment income		170,688,068
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions		381,040,713
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies		2,692,854,732
Net Assets		$ 11,287,222,887

Initial Class: Net Asset Value, offering price and redemption price per share ($8,689,828,908 ÷ 342,542,001 shares)		$ 25.37

Service Class: Net Asset Value, offering price and redemption price per share ($1,170,777,702 ÷ 46,313,238 shares)		$ 25.28

Service Class 2: Net Asset Value, offering price and redemption price per share ($1,420,999,293 ÷ 56,645,362 shares)		$ 25.09

Service Class 2R: Net Asset Value, offering price and redemption price per share ($5,616,984 ÷ 224,552 shares)		$ 25.01

Statement of Operations

Year ended December 31, 2004
Investment Income
Dividends		$ 236,033,278
Interest		4,492,568
Security lending		990,003
Total income		241,515,849

Expenses
Management fee	$ 50,339,584
Transfer agent fees	7,040,948
Distribution fees	3,960,547
Accounting and security lending fees	1,403,577
Non-interested trustees' compensation	58,219
Appreciation in deferred trustee compensation account	26,259
Custodian fees and expenses	286,747
Registration fees	8,658
Audit	103,482
Legal	28,314
Interest	9,745
Miscellaneous	1,847,706
Total expenses before reductions	65,113,786
Expense reductions	(874,557)	64,239,229
Net investment income (loss)		177,276,620
Realized and Unrealized Gain (Loss) Net realized gain (loss) on:
Investment securities	393,977,845
Foreign currency transactions	10,545
Total net realized gain (loss)		393,988,390
Change in net unrealized appreciation (depreciation) on: Investment securities (net of decrease in deferred foreign taxes of $1,499,172)	595,198,380
Assets and liabilities in foreign currencies	(21,670)
Total change in net unrealized appreciation (depreciation)		595,176,710
Net gain (loss)		989,165,100
Net increase (decrease) in net assets resulting from operations		$ 1,166,441,720

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products: Equity-Income Portfolio
Financial Statements - continued

Statement of Changes in Net Assets

	Year ended December 31, 2004	Year ended December 31, 2003
Increase (Decrease) in Net Assets
Operations
Net investment income (loss)	$ 177,276,620	$ 156,056,293
Net realized gain (loss)	393,988,390	162,136,844
Change in net unrealized appreciation (depreciation)	595,176,710	2,060,660,428
Net increase (decrease) in net assets resulting from operations	1,166,441,720	2,378,853,565
Distributions to shareholders from net investment income	(160,632,605)	(152,426,442)
Distributions to shareholders from net realized gain	(38,902,738)	-
Total distributions	(199,535,343)	(152,426,442)
Share transactions - net increase (decrease)	(72,700,137)	95,024,961
Redemption fees	27	6,803
Total increase (decrease) in net assets	894,206,267	2,321,458,887

Net Assets
Beginning of period	10,393,016,620	8,071,557,733
End of period (including undistributed net investment income of $170,688,068 and undistributed net investment income of $153,745,641, respectively)	$ 11,287,222,887	$ 10,393,016,620

Other Information:
Share Transactions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2	Service Class 2R
Shares Sold	19,642,612	4,254,175	21,126,824	207,129
Reinvested	6,898,356	858,454	759,147	2,031
Redeemed	(46,454,587)	(5,170,065)	(5,169,545)	(67,130)
Net increase (decrease)	(19,913,619)	(57,436)	16,716,426	142,030

Dollars Sold	$ 460,321,782	$ 99,280,265	$ 490,310,488	$ 4,777,338
Reinvested	161,766,458	20,079,238	17,642,584	47,063
Redeemed	(1,086,286,467)	(119,952,965)	(119,145,127)	(1,540,794)
Net increase (decrease)	$ (464,198,227)	$ (593,462)	$ 388,807,945	$ 3,283,607

Share Transactions	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2	Service Class 2R
Shares Sold	32,080,268	11,240,469	21,169,436	138,968
Reinvested	7,869,268	847,723	452,997	1,082
Redeemed	(57,207,152)	(8,346,250)	(4,117,145)	(83,694)
Net increase (decrease)	(17,257,616)	3,741,942	17,505,288	56,356

Dollars Sold	$ 628,858,276	$ 219,068,172	$ 416,030,936	$ 2,784,343
Reinvested	130,865,933	14,063,717	7,478,977	17,815
Redeemed	(1,083,344,265)	(159,436,339)	(79,803,985)	(1,558,619)
Net increase (decrease)	$ (323,620,056)	$ 73,695,550	$ 343,705,928	$ 1,243,539

Distributions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2	Service Class 2R
From net investment income	$ 130,573,823	$ 16,025,683	$ 13,995,319	$ 37,780
From net realized gain	31,192,635	4,053,555	3,647,265	9,283
Total	$ 161,766,458	$ 20,079,238	$ 17,642,584	$ 47,063
	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2	Service Class 2R
From net investment income	$ 130,865,933	$ 14,063,717	$ 7,478,977	$ 17,815
From net realized gain	-	-	-	-
Total	$ 130,865,933	$ 14,063,717	$ 7,478,977	$ 17,815

See accompanying notes which are an integral part of the financial statements.

Equity-Income Portfolio

Financial Highlights - Initial Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 23.18	$ 18.16	$ 22.75	$ 25.52	$ 25.71
Income from Investment Operations
Net investment income (loss)^C	.40	.36	.34	.34	.40
Net realized and unrealized gain (loss)	2.24	5.01	(4.08)	(1.51)	1.46
Total from investment operations	2.64	5.37	(3.74)	(1.17)	1.86
Distributions from net investment income	(.36)	(.35)	(.36)	(.42)	(.44)
Distributions from net realized gain	(.09)	-	(.49)	(1.18)	(1.61)
Total distributions	(.45)	(.35)	(.85)	(1.60)	(2.05)
Redemption fees added to paid in capital	-^{C, E}	-^{C, E}	-^{C, E}	-	-
Net asset value, end of period	$ 25.37	$ 23.18	$ 18.16	$ 22.75	$ 25.52
Total Return^{A, B}	11.53%	30.33%	(16.95)%	(4.96)%	8.42%
Ratios to Average Net Assets^D
Expenses before expense reductions	.58%	.57%	.57%	.58%	.56%
Expenses net of voluntary waivers, if any	.58%	.57%	.57%	.58%	.56%
Expenses net of all reductions	.57%	.56%	.56%	.57%	.55%
Net investment income (loss)	1.71%	1.83%	1.70%	1.47%	1.68%
Supplemental Data
Net assets, end of period (000 omitted)	$ 8,689,829	$ 8,402,963	$ 6,895,940	$ 9,256,205	$ 9,969,086
Portfolio turnover rate	22%	26%	25%	24%	22%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^E Amount represents less than $.01 per share.

Financial Highlights - Service Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 23.11	$ 18.10	$ 22.67	$ 25.45	$ 25.66
Income from Investment Operations
Net investment income (loss)^C	.38	.34	.32	.31	.37
Net realized and unrealized gain (loss)	2.22	5.00	(4.06)	(1.51)	1.46
Total from investment operations	2.60	5.34	(3.74)	(1.20)	1.83
Distributions from net investment income	(.34)	(.33)	(.34)	(.40)	(.43)
Distributions from net realized gain	(.09)	-	(.49)	(1.18)	(1.61)
Total distributions	(.43)	(.33)	(.83)	(1.58)	(2.04)
Redemption fees added to paid in capital	-^{C, E}	-^{C, E}	-^{C, E}	-	-
Net asset value, end of period	$ 25.28	$ 23.11	$ 18.10	$ 22.67	$ 25.45
Total Return^{A, B}	11.38%	30.22%	(17.00)%	(5.09)%	8.30%
Ratios to Average Net Assets^D
Expenses before expense reductions	.68%	.67%	.67%	.68%	.66%
Expenses net of voluntary waivers, if any	.68%	.67%	.67%	.68%	.66%
Expenses net of all reductions	.67%	.66%	.66%	.67%	.65%
Net investment income (loss)	1.61%	1.73%	1.60%	1.37%	1.58%
Supplemental Data
Net assets, end of period (000 omitted)	$ 1,170,778	$ 1,071,483	$ 771,516	$ 836,017	$ 634,897
Portfolio turnover rate	22%	26%	25%	24%	22%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^E Amount represents less than $.01 per share.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Service Class 2

Years ended December 31,	2004	2003	2002	2001	2000^F
Selected Per-Share Data
Net asset value, beginning of period	$ 22.96	$ 18.00	$ 22.59	$ 25.41	$ 25.18
Income from Investment Operations
Net investment income (loss)^E	.34	.31	.28	.27	.32
Net realized and unrealized gain (loss)	2.21	4.97	(4.04)	(1.50)	1.95
Total from investment operations	2.55	5.28	(3.76)	(1.23)	2.27
Distributions from net investment income	(.33)	(.32)	(.34)	(.41)	(.43)
Distributions from net realized gain	(.09)	-	(.49)	(1.18)	(1.61)
Total distributions	(.42)	(.32)	(.83)	(1.59)	(2.04)
Redemption fees added to paid in capital	-^{E, H}	-^{E, H}	-^{E, H}	-	-
Net asset value, end of period	$ 25.09	$ 22.96	$ 18.00	$ 22.59	$ 25.41
Total Return^{B, C, D}	11.23%	30.03%	(17.15)%	(5.23)%	10.19%
Ratios to Average Net Assets^G
Expenses before expense reductions	.83%	.82%	.83%	.84%	.83%^A
Expenses net of voluntary waivers, if any	.83%	.82%	.83%	.84%	.83%^A
Expenses net of all reductions	.82%	.81%	.82%	.83%	.82%^A
Net investment income (loss)	1.46%	1.58%	1.44%	1.21%	1.41%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 1,420,999	$ 916,679	$ 403,632	$ 226,078	$ 39,911
Portfolio turnover rate	22%	26%	25%	24%	22%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F For the period January 12, 2000 (commencement of sale of shares) to December 31, 2000.

^H Amount represents less than $.01 per share.

Financial Highlights - Service Class 2R

Years ended December 31,	2004	2003	2002^F
Selected Per-Share Data
Net asset value, beginning of period	$ 22.91	$ 17.99	$ 21.82
Income from Investment Operations
Net investment income (loss)^E	.34	.31	.18
Net realized and unrealized gain (loss)	2.20	4.96	(4.01)
Total from investment operations	2.54	5.27	(3.83)
Distributions from net investment income	(.35)	(.35)	-
Distributions from net realized gain	(.09)	-	-
Total distributions	(.44)	(.35)	-
Redemption fees added to paid in capital^{E, H}	-	-	-
Net asset value, end of period	$ 25.01	$ 22.91	$ 17.99
Total Return^{B, C, D}	11.22%	30.05%	(17.55)%
Ratios to Average Net Assets^G
Expenses before expense reductions	.83%	.82%	.85%^A
Expenses net of voluntary waivers, if any	.83%	.82%	.85%^A
Expenses net of all reductions	.82%	.81%	.84%^A
Net investment income (loss)	1.46%	1.57%	1.45%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 5,617	$ 1,891	$ 471
Portfolio turnover rate	22%	26%	25%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F For the period April 24, 2002 (commencement of sale of shares) to December 31, 2002.

^H Amount represents less than $.01 per share.

See accompanying notes which are an integral part of the financial statements.

Equity-Income Portfolio

Fidelity Variable Insurance Products: Growth Portfolio

Performance: The Bottom Line

Average annual total return reflects the change in the value of an investment, assuming reinvestment of the class' dividend income and capital gains (the profits earned upon the sale of securities that have grown in value) and assuming a constant rate of performance each year. During periods of reimbursement by Fidelity, a fund's total return will be greater than it would be had the reimbursement not occurred. Performance numbers are net of all underlying fund operating expenses, but do not include any insurance charges imposed by your insurance company's separate account. If performance information included the effect of these additional charges, the total returns would have been lower. How a fund did yesterday is no guarantee of how it will do tomorrow.

Average Annual Total Returns

Periods ended December 31, 2004	Past 1 year	Past 5 years	Past 10 years
Fidelity ® VIP: Growth - Initial Class	3.38%	-6.79%	9.97%
Fidelity VIP: Growth - Service Class^A	3.26%	-6.88%	9.89%
Fidelity VIP: Growth - Service Class 2^B	3.12%	-7.02%	9.81%

^A The initial offering of Service Class shares took place on November 3, 1997. Performance for Service Class shares reflects an asset-based service fee (12b-1 fee), and returns prior to November 3, 1997 are those of Initial Class and do not include the effects of Service Class 12b-1 fee. Had Service Class shares 12b-1 fee been reflected, returns prior to November 3, 1997 would have been lower.

^B The initial offering of Service Class 2 shares took place on January 12, 2000. Performance for Service Class 2 shares reflects an asset-based service fee (12b-1 fee). Returns from November 3, 1997 through January 12, 2000 are those of Service Class which reflect a different 12b-1 fee. Service Class 2 returns prior to November 3, 1997 are those of Initial Class, and do not include the effects of a 12b-1 fee. Had Service Class 2's 12b-1 fee been reflected, returns prior to January 12, 2000 would have been lower.

$10,000 Over 10 Years

Let's say hypothetically that $10,000 was invested in Fidelity® Variable Insurance Products: Growth Portfolio - Initial Class on December 31, 1994. The chart shows how the value of your investment would have changed, and also shows how the Russell 3000® Growth Index performed over the same period.

Annual Report

Fidelity Variable Insurance Products: Growth Portfolio

Management's Discussion of Fund Performance

Comments from Jennifer Uhrig, Portfolio Manager of Fidelity® Variable Insurance Products: Growth Portfolio

For the 12 months that ended December 31, 2004, the fund lagged both the Lipper^SM Variable Annuity Growth Funds Average, which gained 10.36%, and the Russell 3000 Growth Index. The fund's large overweighting compared with the index in the semiconductor industry accounted for most of the drag on performance. Capacity outgrew demand for semiconductors during the period, which compressed the earnings and stock prices of many companies within the group. Among those hardest hit were fund holdings ASML Holding, Agere Systems, Teradyne and Intersil, as well as the fund's biggest detractor, Synopsys, which makes software for designing chips. Performance also was hurt by the fund's focus on large-cap growth companies at a time when smaller-cap, value-oriented stocks were generally performing better. On the positive side, wireless communications stocks, such as Ericsson and QUALCOMM, and energy services companies, such as Halliburton, helped boost relative performance. The fund no longer holds Ericsson stock.

Annual Report

Fidelity Variable Insurance Products: Growth Portfolio

Investment Summary

Top Five Stocks as of December 31, 2004
	% of fund's net assets
Johnson & Johnson	2.8
Microsoft Corp.	2.6
Intel Corp.	2.6
Wal-Mart Stores, Inc.	2.5
Dell, Inc.	2.2
	12.7
Top Five Market Sectors as of December 31, 2004
	% of fund's net assets
Information Technology	34.5
Health Care	19.4
Consumer Discretionary	12.2
Industrials	11.3
Financials	9.0

Asset Allocation as of December 31, 2004
% of fund's net assets*
	Stocks	99.3%
	Short-Term Investments and Net Other Assets	0.7%
* Foreign investments		8.8%

Annual Report

Fidelity Variable Insurance Products: Growth Portfolio

Investments December 31, 2004

Showing Percentage of Net Assets

Common Stocks - 99.3%
	Shares		Value (Note 1)
CONSUMER DISCRETIONARY - 12.2%
Automobiles - 0.2%
Harley-Davidson, Inc.	396,200		$ 24,069,150
Hotels, Restaurants & Leisure - 1.4%
Carnival Corp. unit	403,100		23,230,653
Hilton Group PLC	1,886,329		10,298,785
McDonald's Corp.	1,433,200		45,948,392
Rank Group PLC	2,796,306		14,166,903
Royal Caribbean Cruises Ltd.	419,600		22,843,024
Starbucks Corp. (a)	391,800		24,432,648
			140,920,405
Household Durables - 0.2%
Tempur-Pedic International, Inc.	694,300		14,719,160
Internet & Catalog Retail - 1.7%
eBay, Inc. (a)	1,156,600		134,489,448
IAC/InterActiveCorp (a)	1,342,784		37,087,694
			171,577,142
Media - 2.6%
E.W. Scripps Co. Class A	839,400		40,526,232
Fox Entertainment Group, Inc. Class A (a)	1,554,900		48,606,174
Getty Images, Inc. (a)	163,400		11,250,090
Lamar Advertising Co. Class A (a)	948,560		40,579,397
News Corp.:
Class A	657,722		12,273,093
Class B	1,149,000		22,060,800
Pixar (a)	147,632		12,638,776
SBS Broadcasting SA (a)	195,400		7,860,942
Walt Disney Co.	2,128,400		59,169,520
			254,965,024
Multiline Retail - 1.5%
Dollar Tree Stores, Inc. (a)	1,235,300		35,428,404
Family Dollar Stores, Inc.	697,900		21,795,417
Fred's, Inc. Class A (d)	940,644		16,367,206
Kohl's Corp. (a)	90,900		4,469,553
Nordstrom, Inc.	728,500		34,042,805
Saks, Inc.	2,822,700		40,957,377
			153,060,762
Specialty Retail - 4.2%
Bed Bath & Beyond, Inc. (a)	751,500		29,932,245
Best Buy Co., Inc.	547,800		32,550,276
Circuit City Stores, Inc.	997,800		15,605,592
Foot Locker, Inc.	1,273,980		34,308,281
Home Depot, Inc.	4,575,900		195,573,966
RadioShack Corp.	605,800		19,918,704
Staples, Inc.	1,512,900		50,999,859
Weight Watchers International, Inc. (a)(d)	856,000		35,155,920
			414,044,843

	Shares		Value (Note 1)
Textiles, Apparel & Luxury Goods - 0.4%
NIKE, Inc. Class B	443,100		$ 40,184,739
TOTAL CONSUMER DISCRETIONARY			1,213,541,225
CONSUMER STAPLES - 7.0%
Beverages - 1.7%
PepsiCo, Inc.	3,041,000		158,740,200
The Coca-Cola Co.	241,100		10,036,993
			168,777,193
Food & Staples Retailing - 2.8%
Wal-Mart Stores, Inc.	4,638,700		245,016,134
Walgreen Co.	883,400		33,896,058
			278,912,192
Food Products - 0.9%
Archer-Daniels-Midland Co.	1,765,300		39,383,843
Bunge Ltd.	739,300		42,147,493
Corn Products International, Inc.	185,400		9,930,024
			91,461,360
Household Products - 1.1%
Procter & Gamble Co.	2,016,420		111,064,414
Personal Products - 0.5%
Gillette Co.	965,400		43,230,612
TOTAL CONSUMER STAPLES			693,445,771
ENERGY - 4.4%
Energy Equipment & Services - 4.0%
Baker Hughes, Inc.	1,796,470		76,655,375
BJ Services Co.	238,760		11,111,890
Halliburton Co.	2,737,100		107,403,804
National-Oilwell, Inc. (a)	902,900		31,863,341
Schlumberger Ltd. (NY Shares)	1,511,400		101,188,230
Smith International, Inc. (a)	452,400		24,615,084
Transocean, Inc. (a)	305,700		12,958,623
Weatherford International Ltd. (a)	611,740		31,382,262
			397,178,609
Oil & Gas - 0.4%
Noble Energy, Inc.	129,100		7,960,306
Premcor, Inc.	363,500		15,328,795
Valero Energy Corp.	344,100		15,622,140
			38,911,241
TOTAL ENERGY			436,089,850
FINANCIALS - 9.0%
Capital Markets - 2.0%
E*TRADE Financial Corp. (a)	2,495,400		37,306,230
Goldman Sachs Group, Inc.	507,400		52,789,896
Lehman Brothers Holdings, Inc.	352,400		30,827,952
Merrill Lynch & Co., Inc.	514,800		30,769,596
Common Stocks - continued
	Shares		Value (Note 1)
FINANCIALS - continued
Capital Markets - continued
Morgan Stanley	383,000		$ 21,264,160
Nomura Holdings, Inc.	1,782,000		25,945,920
			198,903,754
Commercial Banks - 1.2%
Bank of America Corp.	1,536,100		72,181,339
UCBH Holdings, Inc.	965,900		44,257,538
			116,438,877
Consumer Finance - 2.6%
American Express Co.	2,319,900		130,772,763
Capital One Financial Corp.	593,200		49,953,372
MBNA Corp.	2,766,130		77,977,205
			258,703,340
Diversified Financial Services - 0.6%
Citigroup, Inc.	213,210		10,272,458
J.P. Morgan Chase & Co.	1,325,266		51,698,627
			61,971,085
Insurance - 1.9%
AFLAC, Inc.	471,920		18,801,293
American International Group, Inc.	2,575,166		169,111,151
XL Capital Ltd. Class A	53,100		4,123,215
			192,035,659
Thrifts & Mortgage Finance - 0.7%
Fannie Mae	863,600		61,496,956
New York Community Bancorp, Inc.	447,500		9,205,075
			70,702,031
TOTAL FINANCIALS			898,754,746
HEALTH CARE - 19.4%
Biotechnology - 3.9%
Biogen Idec, Inc. (a)	886,600		59,056,426
Cephalon, Inc. (a)	905,000		46,046,400
CSL Ltd.	873,467		19,989,467
Eyetech Pharmaceuticals, Inc.	366,200		16,662,100
Genentech, Inc. (a)	1,863,700		101,459,828
Genzyme Corp. - General Division (a)	550,900		31,990,763
ImClone Systems, Inc. (a)	697,300		32,131,584
Millennium Pharmaceuticals, Inc. (a)	2,608,956		31,620,547
ONYX Pharmaceuticals, Inc. (a)	485,100		15,712,389
QLT, Inc. (a)	393,000		6,297,825
Tanox, Inc. (a)	1,042,600		15,847,520
Telik, Inc. (a)	459,400		8,792,916
			385,607,765
Health Care Equipment & Supplies - 4.6%
Alcon, Inc.	676,700		54,542,020
Baxter International, Inc.	2,321,100		80,170,794
Beckman Coulter, Inc.	311,400		20,860,686
Becton, Dickinson & Co.	1,006,000		57,140,800
C.R. Bard, Inc.	366,400		23,442,272

	Shares		Value (Note 1)
Dade Behring Holdings, Inc. (a)	477,400		$ 26,734,400
Medtronic, Inc.	1,810,300		89,917,601
Ocular Sciences, Inc. (a)	304,900		14,943,149
St. Jude Medical, Inc. (a)	743,000		31,153,990
Thermo Electron Corp. (a)	242,400		7,318,056
Waters Corp. (a)	1,076,200		50,355,398
			456,579,166
Health Care Providers & Services - 0.9%
McKesson Corp.	533,400		16,780,764
UnitedHealth Group, Inc.	883,900		77,809,717
			94,590,481
Pharmaceuticals - 10.0%
Abbott Laboratories	1,880,200		87,711,330
Allergan, Inc.	655,950		53,177,867
Barr Pharmaceuticals, Inc. (a)	840,472		38,275,095
Elan Corp. PLC sponsored ADR (a)	950,500		25,901,125
Eli Lilly & Co.	358,470		20,343,173
Johnson & Johnson	4,464,720		283,152,537
Pfizer, Inc.	7,691,995		206,837,746
Roche Holding AG (participation certificate)	307,139		35,095,439
Schering-Plough Corp.	6,086,200		127,079,856
Wyeth	2,628,100		111,930,779
			989,504,947
TOTAL HEALTH CARE			1,926,282,359
INDUSTRIALS - 11.3%
Aerospace & Defense - 3.7%
Bombardier, Inc. Class B (sub. vtg.)	14,014,600		27,795,623
EADS NV	1,697,000		49,241,178
Embraer - Empresa Brasileira de Aeronautica SA sponsored ADR	1,492,210		49,899,502
General Dynamics Corp.	353,400		36,965,640
Goodrich Corp.	1,112,680		36,317,875
Honeywell International, Inc.	310,300		10,987,723
Lockheed Martin Corp.	969,520		53,856,836
Precision Castparts Corp.	529,674		34,788,988
The Boeing Co.	1,231,100		63,734,047
			363,587,412
Air Freight & Logistics - 1.9%
EGL, Inc. (a)	150,900		4,510,401
FedEx Corp.	648,400		63,860,916
Forward Air Corp. (a)	107,700		4,814,190
United Parcel Service, Inc. Class B	1,263,100		107,944,526
UTI Worldwide, Inc.	143,400		9,754,068
			190,884,101
Commercial Services & Supplies - 0.7%
Apollo Group, Inc. Class A (a)	157,400		12,703,754
Common Stocks - continued
	Shares		Value (Note 1)
INDUSTRIALS - continued
Commercial Services & Supplies - continued
Herman Miller, Inc.	429,700		$ 11,872,611
Robert Half International, Inc.	1,470,300		43,270,929
			67,847,294
Industrial Conglomerates - 3.6%
3M Co.	1,187,100		97,425,297
General Electric Co.	5,144,640		187,779,360
Siemens AG sponsored ADR	428,300		36,264,161
Tyco International Ltd.	908,000		32,451,920
			353,920,738
Machinery - 0.3%
Joy Global, Inc.	625,351		27,158,994
Marine - 0.0%
Alexander & Baldwin, Inc.	11,700		496,314
Road & Rail - 1.0%
Burlington Northern Santa Fe Corp.	707,700		33,481,287
Norfolk Southern Corp.	914,700		33,102,993
Union Pacific Corp.	533,700		35,891,325
			102,475,605
Trading Companies & Distributors - 0.1%
UAP Holding Corp.	902,881		15,592,755
TOTAL INDUSTRIALS			1,121,963,213
INFORMATION TECHNOLOGY - 34.5%
Communications Equipment - 7.8%
Alvarion Ltd. (a)	863,500		11,467,280
Andrew Corp. (a)	1,803,300		24,578,979
Avaya, Inc. (a)	3,175,098		54,611,686
Cisco Systems, Inc. (a)	10,930,820		210,964,826
Extreme Networks, Inc. (a)	81,436		533,406
F5 Networks, Inc. (a)	368,600		17,958,192
Foundry Networks, Inc. (a)	1,743,200		22,940,512
Harris Corp.	872,000		53,880,880
Juniper Networks, Inc. (a)	2,616,000		71,129,040
Motorola, Inc.	5,886,150		101,241,780
QUALCOMM, Inc.	3,971,900		168,408,560
Research In Motion Ltd. (a)	408,390		33,617,303
			771,332,444
Computers & Peripherals - 5.9%
Apple Computer, Inc. (a)	179,200		11,540,480
Brocade Communications Systems, Inc. (a)	2,962,000		22,629,680
Dell, Inc. (a)	5,261,460		221,717,924
EMC Corp. (a)	5,566,000		82,766,420
International Business Machines Corp.	821,370		80,970,655
Lexmark International, Inc. Class A (a)	707,200		60,112,000
Network Appliance, Inc. (a)	1,311,292		43,561,120
QLogic Corp. (a)	396,500		14,563,445

	Shares		Value (Note 1)
Sun Microsystems, Inc. (a)	6,336,150		$ 34,088,487
UNOVA, Inc. (a)	680,300		17,204,787
			589,154,998
Electronic Equipment & Instruments - 1.7%
Amphenol Corp. Class A (a)	506,582		18,611,823
Arrow Electronics, Inc. (a)	846,300		20,565,090
Hon Hai Precision Industries Co. Ltd.	6,438,842		29,773,821
Mettler-Toledo International, Inc. (a)	437,600		22,453,256
Molex, Inc.	703,200		21,096,000
National Instruments Corp.	1,210,629		32,989,640
Solectron Corp. (a)	4,272,300		22,771,359
			168,260,989
Internet Software & Services - 1.3%
Google, Inc. Class A	299,700		57,872,070
Yahoo!, Inc. (a)	1,918,232		72,278,982
			130,151,052
IT Services - 1.1%
BearingPoint, Inc. (a)	3,072,021		24,668,329
First Data Corp.	2,095,000		89,121,300
			113,789,629
Office Electronics - 0.1%
Zebra Technologies Corp. Class A (a)	116,850		6,576,318
Semiconductors & Semiconductor Equipment - 9.8%
Agere Systems, Inc.:
Class A (a)	8,448,145		11,573,959
Class B (a)	6,893,509		9,306,237
Altera Corp. (a)	2,183,000		45,188,100
Analog Devices, Inc.	1,408,900		52,016,588
Applied Materials, Inc. (a)	1,477,800		25,270,380
ASML Holding NV (NY Shares) (a)	2,542,776		40,455,566
Fairchild Semiconductor International, Inc. (a)	1,525,200		24,799,752
Freescale Semiconductor, Inc.:
Class A	3,041,300		54,195,966
Class B	649,919		11,932,513
Integrated Circuit Systems, Inc. (a)	1,552,759		32,483,718
Intel Corp.	11,075,800		259,062,962
International Rectifier Corp. (a)	486,400		21,678,848
Intersil Corp. Class A	2,966,736		49,663,161
KLA-Tencor Corp. (a)	486,100		22,642,538
Lam Research Corp. (a)	888,800		25,695,208
Marvell Technology Group Ltd. (a)	24,300		861,921
MediaTek, Inc.	2,656,000		18,046,430
Microchip Technology, Inc.	1,150,900		30,682,994
ON Semiconductor Corp. (a)	3,045,700		13,827,478
PMC-Sierra, Inc. (a)	3,316,682		37,312,673
Taiwan Semiconductor Manufacturing Co. Ltd. sponsored ADR	5,386,674		45,732,862
Teradyne, Inc. (a)	1,264,000		21,576,480
Texas Instruments, Inc.	1,442,650		35,518,043
Tokyo Electron Ltd.	377,300		23,242,830
Common Stocks - continued
	Shares		Value (Note 1)
INFORMATION TECHNOLOGY - continued
Semiconductors & Semiconductor Equipment - continued
United Microelectronics Corp. sponsored ADR (d)	6,073,920		$ 21,440,938
Xilinx, Inc.	1,438,000		42,636,700
			976,844,845
Software - 6.8%
Adobe Systems, Inc.	340,874		21,386,435
Cadence Design Systems, Inc. (a)	3,260,000		45,020,600
Cognos, Inc. (a)	232,600		10,238,277
Computer Associates International, Inc.	5,455		169,432
Macrovision Corp. (a)	191,952		4,937,005
McAfee, Inc. (a)	636,700		18,419,731
Microsoft Corp.	9,714,850		259,483,644
NAVTEQ Corp.	90,700		4,204,852
Novell, Inc. (a)	4,444,826		30,002,576
Oracle Corp. (a)	7,579,691		103,993,361
Red Hat, Inc. (a)	719,500		9,605,325
SAP AG sponsored ADR	1,256,600		55,554,286
Symantec Corp. (a)	1,408,306		36,277,963
Take-Two Interactive Software, Inc. (a)	1,109,100		38,585,589
VERITAS Software Corp. (a)	1,227,400		35,042,270
			672,921,346
TOTAL INFORMATION TECHNOLOGY			3,429,031,621
MATERIALS - 1.2%
Chemicals - 0.5%
Monsanto Co.	617,800		34,318,790
Syngenta AG sponsored ADR	709,300		15,143,555
			49,462,345
Containers & Packaging - 0.1%
Smurfit-Stone Container Corp. (a)	812,611		15,179,573
Metals & Mining - 0.6%
Arch Coal, Inc.	374,500		13,309,730
CONSOL Energy, Inc.	465,300		19,100,565
Massey Energy Co.	676,800		23,654,160
			56,064,455
TOTAL MATERIALS			120,706,373
TELECOMMUNICATION SERVICES - 0.3%
Wireless Telecommunication Services - 0.3%
Nextel Communications, Inc. Class A (a)	824,100		24,723,000
TOTAL COMMON STOCKS (Cost $7,736,201,771)		9,864,538,158
Preferred Stocks - 0.0%
	Shares		Value (Note 1)
Convertible Preferred Stocks - 0.0%
INFORMATION TECHNOLOGY - 0.0%
Communications Equipment - 0.0%
Chorum Technologies, Inc. Series E (a)(f)	88,646		$ 0
Nonconvertible Preferred Stocks - 0.0%
HEALTH CARE - 0.0%
Biotechnology - 0.0%
Geneprot, Inc. Series A (f)	826,000		2,891,000
TOTAL PREFERRED STOCKS (Cost $5,872,855)		2,891,000
Convertible Bonds - 0.0%
	Principal Amount
INFORMATION TECHNOLOGY - 0.0%
Semiconductors & Semiconductor Equipment - 0.0%
Micron Technology, Inc. 2.5% 2/1/10 (e)	$ 1,523,000		1,806,430
TOTAL CONVERTIBLE BONDS (Cost $1,523,000)		1,806,430
Money Market Funds - 0.7%
	Shares
Fidelity Cash Central Fund, 2.24% (b)	40,371,676		40,371,676
Fidelity Securities Lending Cash Central Fund, 2.23% (b)(c)	25,933,096		25,933,096
TOTAL MONEY MARKET FUNDS (Cost $66,304,772)		66,304,772

TOTAL INVESTMENT
PORTFOLIO - 100.0%

(Cost $7,809,902,398)

9,935,540,360

NET OTHER ASSETS - 0.0%

1,402,138

NET ASSETS - 100%

$ 9,936,942,498

Legend

(a) Non-income producing

(d) Security or a portion of the security is on loan at period end.

(f) Restricted securities - Investment in securities not registered under the Securities Act of 1933 (excluding 144A issues). At the end of the period, the value of restricted securities (excluding 144A issues) amounted to $2,891,000 or 0.0% of net assets.

Additional information on each holding is as follows:

Security	Acquisition Date	Acquisition Cost
Chorum Technologies, Inc. Series E	9/19/00	$ 1,528,257
Geneprot, Inc. Series A	7/7/00	$ 4,543,000

Income Tax Information

At December 31, 2004, the fund had a capital loss carryforward of approximately $3,653,617,000 of which $1,411,197,000, $2,197,712,000 and $44,708,000 will expire on December 31, 2009, 2010 and 2011, respectively.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products: Growth Portfolio

Financial Statements

Statement of Assets and Liabilities

December 31, 2004
Assets
Investment in securities, at value (including securities loaned of $24,929,493) (cost $7,809,902,398) - See accompanying schedule		$ 9,935,540,360
Cash		54,548
Foreign currency held at value (cost $29,573,196)		30,067,997
Receivable for investments sold		14,033,133
Receivable for fund shares sold		4,485,109
Dividends receivable		7,487,115
Interest receivable		113,675
Prepaid expenses		38,895
Other affiliated receivables		49,263
Other receivables		1,519,976
Total assets		9,993,390,071
Liabilities
Payable for investments purchased	$ 3,936,983
Payable for fund shares redeemed	19,018,541
Accrued management fee	4,740,859
Distribution fees payable	276,915
Other affiliated payables	865,803
Other payables and accrued expenses	1,675,376
Collateral on securities loaned, at value	25,933,096
Total liabilities		56,447,573
Net Assets		$ 9,936,942,498
Net Assets consist of:
Paid in capital		$ 11,449,421,694
Undistributed net investment income		42,500,013
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions		(3,681,114,074)
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies		2,126,134,865
Net Assets		$ 9,936,942,498

Initial Class: Net Asset Value, offering price and redemption price per share ($7,796,887,587 ÷ 243,554,460 shares)		$ 32.01

Service Class: Net Asset Value, offering price and redemption price per share ($1,326,262,008 ÷ 41,602,270 shares)		$ 31.88

Service Class 2: Net Asset Value, offering price and redemption price per share ($811,126,385 ÷ 25,638,241 shares)		$ 31.64

Service Class 2R: Net Asset Value, offering price and redemption price per share ($2,666,518 ÷ 84,539 shares)		$ 31.54

Statement of Operations

Year ended December 31, 2004

Investment Income
Dividends^A		$ 86,850,641
Special Dividends		26,028,750
Interest		880,245
Security lending		520,076
Total income		114,279,712

Expenses
Management fee	$ 58,590,211
Transfer agent fees	6,723,531
Distribution fees	3,143,384
Accounting and security lending fees	1,387,678
Non-interested trustees' compensation	56,073
Appreciation in deferred trustee compensation account	14,142
Custodian fees and expenses	300,615
Audit	96,165
Legal	32,336
Interest	39,066
Miscellaneous	2,052,657
Total expenses before reductions	72,435,858
Expense reductions	(3,293,886)	69,141,972
Net investment income (loss)		45,137,740
Realized and Unrealized Gain (Loss) Net realized gain (loss) on:
Investment securities	704,506,123
Foreign currency transactions	(113,869)
Total net realized gain (loss)		704,392,254
Change in net unrealized appreciation (depreciation) on: Investment securities	(449,154,576)
Assets and liabilities in foreign currencies	499,190
Total change in net unrealized appreciation (depreciation)		(448,655,386)
Net gain (loss)		255,736,868
Net increase (decrease) in net assets resulting from operations		$ 300,874,608

^A As a result of the change in the estimate of the return of capital component of dividend income realized in the year ended December 31, 2003, dividend income has been reduced by $2,260,756, with a corresponding increase to net realized gain (loss) and net unrealized appreciation (depreciation).

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products: Growth Portfolio
Financial Statements - continued

Statement of Changes in Net Assets

	Year ended December 31, 2004	Year ended December 31, 2003
Increase (Decrease) in Net Assets
Operations
Net investment income (loss)	$ 45,137,740	$ 23,031,175
Net realized gain (loss)	704,392,254	49,130,228
Change in net unrealized appreciation (depreciation)	(448,655,386)	2,530,101,870
Net increase (decrease) in net assets resulting from operations	300,874,608	2,602,263,273
Distributions to shareholders from net investment income	(25,185,765)	(23,104,405)
Share transactions - net increase (decrease)	(945,720,754)	(285,825,613)
Redemption fees	13	2,361
Total increase (decrease) in net assets	(670,031,898)	2,293,335,616

Net Assets
Beginning of period	10,606,974,396	8,313,638,780
End of period (including undistributed net investment income of $42,500,013 and undistributed net investment income of $22,711,797, respectively)	$ 9,936,942,498	$ 10,606,974,396

Other Information:
Share Transactions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2	Service Class 2R
Shares Sold	10,173,829	3,809,653	9,957,726	63,032
Reinvested	677,303	70,256	26,349	100
Redeemed	(44,148,491)	(7,601,708)	(4,196,333)	(23,264)
Net increase (decrease)	(33,297,359)	(3,721,799)	5,787,742	39,868

Dollars Sold	$ 317,143,990	$ 118,147,419	$ 305,162,849	$ 1,941,136
Reinvested	22,052,984	2,279,802	849,771	3,208
Redeemed	(1,353,451,648)	(232,412,004)	(126,744,925)	(693,336)
Net increase (decrease)	$ (1,014,254,674)	$ (111,984,783)	$ 179,267,695	$ 1,251,008

Share Transactions	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2	Service Class 2R
Shares Sold	23,586,131	8,385,408	13,542,393	50,235
Reinvested	941,499	102,591	14,708	31
Redeemed	(47,048,733)	(8,519,590)	(3,984,642)	(14,664)
Net increase (decrease)	(22,521,103)	(31,591)	9,572,459	35,602

Dollars Sold	$ 625,883,728	$ 221,233,256	$ 361,842,888	$ 1,388,031
Reinvested	20,552,932	2,232,378	318,424	671
Redeemed	(1,198,774,049)	(217,996,235)	(102,097,753)	(409,884)
Net increase (decrease)	$ (552,337,389)	$ 5,469,399	$ 260,063,559	$ 978,818

Distributions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2	Service Class 2R
From net investment income	$ 22,052,984	$ 2,279,802	$ 849,771	$ 3,208
	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2	Service Class 2R
From net investment income	$ 20,552,932	$ 2,232,378	$ 318,424	$ 671

See accompanying notes which are an integral part of the financial statements.

Growth Portfolio

Financial Highlights - Initial Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 31.04	$ 23.44	$ 33.61	$ 43.66	$ 54.93
Income from Investment Operations
Net investment income (loss)^C	.15^{D, G}	.07	.07	.07	.03
Net realized and unrealized gain (loss)	.90	7.60	(10.17)	(7.27)	(5.27)
Total from investment operations	1.05	7.67	(10.10)	(7.20)	(5.24)
Distributions from net investment income	(.08)	(.07)	(.07)	(.03)	(.06)
Distributions from net realized gain	-	-	-	(2.82)	(5.97)
Total distributions	(.08)	(.07)	(.07)	(2.85)	(6.03)
Redemption fees added to paid in capital	-^{C, F}	-^{C, F}	-^{C, F}	-	-
Net asset value, end of period	$ 32.01	$ 31.04	$ 23.44	$ 33.61	$ 43.66
Total Return^{A, B}	3.38%	32.85%	(30.10)%	(17.67)%	(10.96)%
Ratios to Average Net Assets^E
Expenses before expense reductions	.68%	.67%	.67%	.68%	.65%
Expenses net of voluntary waivers, if any	.68%	.67%	.67%	.68%	.65%
Expenses net of all reductions	.65%	.64%	.61%	.65%	.64%
Net investment income (loss)	.47%^G	.28%	.25%	.19%	.07%
Supplemental Data
Net assets, end of period (000 omitted)	$ 7,796,888	$ 8,594,509	$ 7,016,147	$ 11,458,659	$ 15,517,271
Portfolio turnover rate	72%	61%	90%	105%	103%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^D Investment income per share reflects a special dividend which amounted to $.08 per share.

^F Amount represents less than $.01 per share.

^G As a result in the change in the estimate of the return of capital component of divided income realized in the year ended December 31, 2003, net investment income per share and the ratio of net investment income to average net assets for the year ended December 31, 2004 have been reduced by $.01 per share and .02%, respectively. The change in estimate has no impact on total net assets or total return of the fund.

Financial Highlights - Service Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 30.92	$ 23.34	$ 33.48	$ 43.51	$ 54.80
Income from Investment Operations
Net investment income (loss)^C	.11^{D, G}	.05	.04	.03	(.02)
Net realized and unrealized gain (loss)	.90	7.58	(10.14)	(7.24)	(5.25)
Total from investment operations	1.01	7.63	(10.10)	(7.21)	(5.27)
Distributions from net investment income	(.05)	(.05)	(.04)	-	(.05)
Distributions from net realized gain	-	-	-	(2.82)	(5.97)
Total distributions	(.05)	(.05)	(.04)	(2.82)	(6.02)
Redemption fees added to paid in capital	-^{C, F}	-^{C, F}	-^{C, F}	-	-
Net asset value, end of period	$ 31.88	$ 30.92	$ 23.34	$ 33.48	$ 43.51
Total Return^{A, B}	3.26%	32.78%	(30.20)%	(17.74)%	(11.05)%
Ratios to Average Net Assets^E
Expenses before expense reductions	.78%	.77%	.77%	.78%	.76%
Expenses net of voluntary waivers, if any	.78%	.77%	.77%	.78%	.76%
Expenses net of all reductions	.75%	.74%	.71%	.75%	.74%
Net investment income (loss)	.37%^G	.18%	.15%	.09%	(.04)%
Supplemental Data
Net assets, end of period (000 omitted)	$ 1,326,262	$ 1,401,298	$ 1,058,738	$ 1,655,758	$ 1,847,051
Portfolio turnover rate	72%	61%	90%	105%	103%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^D Investment income per share reflects a special dividend which amounted to $.08 per share.

^F Amount represents less than $.01 per share.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Service Class 2

Years ended December 31,	2004	2003	2002	2001	2000^G
Selected Per-Share Data
Net asset value, beginning of period	$ 30.72	$ 23.21	$ 33.34	$ 43.43	$ 53.40
Income from Investment Operations
Net investment income (loss)^E	.07^{F, J}	.01	-^I	(.02)	(.09)
Net realized and unrealized gain (loss)	.89	7.53	(10.09)	(7.22)	(3.86)
Total from investment operations	.96	7.54	(10.09)	(7.24)	(3.95)
Distributions from net investment income	(.04)	(.03)	(.04)	(.03)	(.05)
Distributions from net realized gain	-	-	-	(2.82)	(5.97)
Total distributions	(.04)	(.03)	(.04)	(2.85)	(6.02)
Redemption fees added to paid in capital	-^{E, I}	-^{E, I}	-^{E, I}	-	-
Net asset value, end of period	$ 31.64	$ 30.72	$ 23.21	$ 33.34	$ 43.43
Total Return^{B, C, D}	3.12%	32.54%	(30.30)%	(17.87)%	(8.88)%
Ratios to Average Net Assets^H
Expenses before expense reductions	.93%	.92%	.93%	.93%	.91%^A
Expenses net of voluntary waivers, if any	.93%	.92%	.93%	.93%	.91%^A
Expenses net of all reductions	.90%	.89%	.87%	.90%	.90%^A
Net investment income (loss)	.22%^J	.02%	(.01)%	(.06)%	(.19)%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 811,126	$ 609,798	$ 238,543	$ 191,475	$ 57,095
Portfolio turnover rate	72%	61%	90%	105%	103%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F Investment income per share reflects a special dividend which amounted to $.08 per share.

^G For the period January 12, 2000 (commencement of sale of shares) to December 31, 2000.

^I Amount represents less than $.01 per share.

^J As a result in the change in the estimate of the return of capital component of divided income realized in the year ended December 31, 2003, net investment income per share and the ratio of net investment income to average net assets for the year ended December 31, 2004 have been reduced by $.01 per share and .02%, respectively. The change in estimate has no impact on total net assets or total return of the fund.

Financial Highlights - Service Class 2R

Years ended December 31,	2004	2003	2002^G
Selected Per-Share Data
Net asset value, beginning of period	$ 30.65	$ 23.20	$ 31.05
Income from Investment Operations
Net investment income (loss)^E	.07^{F, J}	.01	(.01)
Net realized and unrealized gain (loss)	.88	7.51	(7.84)
Total from investment operations	.95	7.52	(7.85)
Distributions from net investment income	(.06)	(.07)	-
Redemption fees added to paid in capital^{E, I}	-	-	-
Net asset value, end of period	$ 31.54	$ 30.65	$ 23.20
Total Return^{B, C, D}	3.10%	32.54%	(25.28)%
Ratios to Average Net Assets^H
Expenses before expense reductions	.93%	.92%	.96%^A
Expenses net of voluntary waivers, if any	.93%	.92%	.96%^A
Expenses net of all reductions	.90%	.90%	.90%^A
Net investment income (loss)	.22%^J	.02%	(.03)%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 2,667	$ 1,369	$ 210
Portfolio turnover rate	72%	61%	90%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F Investment income per share reflects a special dividend which amounted to $.08 per share.

^G For the period April 24, 2002 (commencement of sale of shares) to December 31, 2002.

^I Amount represents less than $.01 per share.

See accompanying notes which are an integral part of the financial statements.

Growth Portfolio

Fidelity Variable Insurance Products: High Income Portfolio

Performance: The Bottom Line

Average annual total return reflects the change in the value of an investment, assuming reinvestment of a class' dividend income and capital gains (the profits earned upon the sale of securities that have grown in value) and assuming a constant rate of performance each year. During periods of reimbursement by Fidelity, a fund's total return will be greater than it would be had the reimbursement not occurred. Performance numbers are net of all underlying fund operating expenses, but do not include any insurance charges imposed by your insurance company's separate account. If performance information included the effect of these additional charges, the total returns would be lower. How a fund did yesterday is no guarantee of how it will do tomorrow.

Average Annual Total Returns

Periods ended December 31, 2004	Past 1 year	Past 5 years	Past 10 years
Fidelity® VIP: High Income - Initial Class	9.59%	-0.27%	5.17%
Fidelity VIP: High Income - Service Class^A	9.47%	-0.38%	5.08%
Fidelity VIP: High Income - Service Class 2^B	9.38%	-0.55%	4.99%

^A The initial offering of Service Class shares took place on November 3, 1997. Performance for Service Class shares reflects an asset based distribution fee (12b-1 fee), and returns prior to November 3, 1997 are those of Initial Class and do not include the effects of Service Class' 12b-1 fee. Had Service Class' 12b-1 fee been reflected, returns prior to November 3, 1997 would have been lower.

^B The initial offering of Service Class 2 shares took place on January 12, 2000. Performance for Service Class 2 shares reflects an asset based distribution fee (12b-1 fee). Returns from November 3, 1997 to January 12, 2000 are those of Service Class which reflect a different 12b-1 fee. Service Class 2 returns prior to November 3, 1997 are those of Initial Class and do not include the effects of a 12b-1 fee. Had Service Class 2's 12b-1 fee been reflected, returns prior to January 12, 2000 would have been lower.

$10,000 Over 10 Years

Let's say hypothetically that $10,000 was invested in Fidelity® Variable Insurance Products: High Income Portfolio - Initial Class on December 31, 1994. The chart shows how the value of your investment would have changed, and also shows how the ML ® U.S. High Yield Master II Index performed over the same period.

Annual Report

Fidelity Variable Insurance Products: High Income Portfolio

Management's Discussion of Fund Performance

Comments from Matthew Conti, Portfolio Manager of Fidelity® Variable Insurance Products: High Income Portfolio

Investors in high-yield securities generally found positive returns in 2004, as the Merrill Lynch® U.S. High Yield Master II Index advanced 10.87% for the year overall. This performance marks the first time the high-yield bond market has posted two consecutive years of double-digit increases since 1996-1997. The strong demand for the attractive yields of high-income securities, plus ready access to capital and a declining default rate, helped drive returns in this non-investment-grade asset class. As corporate America continued to improve its cash flows and deleverage its balance sheets, the stronger credit profiles for companies borrowing in the high-yield market served to make investors less risk averse, particularly in the more speculative credit tiers such as CCC-rated securities, which returned 15.75% during the past year. In comparison, the BB-rated and B-rated sectors rose 9.33% and 10.44%, respectively. As was the case in the equity markets, energy, metals/mining and other commodity industries were among the leaders in the high-yield universe.

During the 12 months that ended December 31, 2004, High Income Portfolio underperformed its benchmark, the Merrill Lynch U.S. High Yield Master II Index, and performed roughly in line with the Lipper^SMVariable Annuity High Current Yield Funds Average, which returned 9.84%. The fund underperformed the index because of its avoidance of the lowest-rated bonds and distressed securities, which performed best during the period. An overweighting in the telecommunications industry also held back performance. On the plus side, strong security selection in cable TV, health care, chemicals and utilities helped the fund's relative performance. Top performers included Huntsman Chemicals, electric utilities AES and Cogentrix, and Delta Airlines. Among the investments that detracted from the fund's performance were semiconductor testing and packaging company Amkor Technology, telecom service provider Cincinnati Bell, theme park company Six Flags and television station operator Granite Broadcasting.

Annual Report

Fidelity Variable Insurance Products: High Income Portfolio

Investment Summary

Top Five Holdings as of December 31, 2004
(by issuer, excluding cash equivalents)	% of fund's net assets
AES Corp.	1.9
American Airlines, Inc. pass thru trust certificates	1.6
Xerox Corp.	1.6
Nextel Communications, Inc.	1.5
MGM MIRAGE	1.5
	8.1
Top Five Market Sectors as of December 31, 2004
	% of fund's net assets
Telecommunications	9.6
Energy	7.5
Chemicals	7.2
Electric Utilities	7.0
Healthcare	6.2

Quality Diversification (% of fund's net assets) as of December 31, 2004
	AAA, AA, A	0.0%
	BBB	0.3%
	BB	36.8%
	B	46.6%
	CCC, CC, C	10.1%
	Not Rated	3.0%
	Other Investments	0.3%
	Equities	0.3%
	Short-Term Investments and Net Other Assets	2.6%

We have used ratings from Moody's Investors Services, Inc. Where Moody's ratings are not available, we have used S&P ratings.

Annual Report

Fidelity Variable Insurance Products: High Income Portfolio

Investments December 31, 2004

Showing Percentage of Net Assets

Nonconvertible Bonds - 91.1%
	Principal Amount		Value (Note 1)
Aerospace - 1.0%
Bombardier, Inc. 6.3% 5/1/14 (e)	$ 5,565,000		$ 4,827,638
L-3 Communications Corp. 5.875% 1/15/15 (e)	4,910,000		4,897,725
Orbital Sciences Corp. 9% 7/15/11	4,720,000		5,310,000
Primus International, Inc. 10.5% 4/15/09 (e)	3,170,000		3,312,650
			18,348,013
Air Transportation - 3.7%
American Airlines, Inc. pass thru trust certificates:
6.817% 5/23/11	11,825,000		11,115,500
6.977% 11/23/22	556,744		520,555
7.324% 4/15/11	1,480,000		1,228,400
7.377% 5/23/19	14,357,509		10,050,256
7.379% 5/23/16	6,249,810		4,374,867
7.8% 4/1/08	2,595,000		2,413,350
10.18% 1/2/13	2,190,000		1,708,200
AMR Corp. 10.2% 3/15/20	165,000		125,400
Delta Air Lines, Inc.:
7.9% 12/15/09	7,330,000		4,617,900
8.3% 12/15/29	13,070,000		6,306,275
9.5% 11/18/08 (e)	4,862,000		4,558,125
10% 8/15/08	3,370,000		2,502,225
Delta Air Lines, Inc. pass thru trust certificates:
7.379% 5/18/10	1,087,647		1,084,928
7.57% 11/18/10	2,950,000		2,909,892
7.711% 9/18/11	865,000		657,400
7.92% 5/18/12	1,565,000		1,205,050
Northwest Airlines Corp. 10% 2/1/09	13,840,000		11,625,600
Northwest Airlines, Inc. pass thru trust certificates:
7.67% 1/2/15	1,360,819		1,187,315
8.07% 1/2/15	1,442,283		1,009,598
			69,200,836
Automotive - 1.1%
Delco Remy International, Inc. 9.375% 4/15/12	5,510,000		5,702,850
Navistar International Corp. 7.5% 6/15/11	5,815,000		6,222,050
Stoneridge, Inc. 11.5% 5/1/12	2,715,000		3,108,675
Tenneco Automotive, Inc.:
8.625% 11/15/14 (e)	3,055,000		3,169,563
10.25% 7/15/13	2,515,000		2,967,700
			21,170,838
Banks and Thrifts - 0.2%
Western Financial Bank 9.625% 5/15/12	2,565,000		2,924,100

	Principal Amount		Value (Note 1)
Broadcasting - 0.3%
Gray Television, Inc. 9.25% 12/15/11	$ 2,235,000		$ 2,503,200
Paxson Communications Corp. 0% 1/15/09 (d)	3,320,000		3,104,200
			5,607,400
Building Materials - 1.3%
Goodman Global Holdings, Inc. 5.76% 6/15/12 (e)(f)	4,905,000		4,990,838
Jacuzzi Brands, Inc. 9.625% 7/1/10	4,070,000		4,517,700
Maax Holdings, Inc. 0% 12/15/12 (d)(e)	5,840,000		3,679,200
Nortek, Inc. 8.5% 9/1/14 (e)	5,350,000		5,590,750
Texas Industries, Inc. 10.25% 6/15/11	4,860,000		5,734,800
			24,513,288
Cable TV - 3.7%
Adelphia Communications Corp.:
7.875% 5/1/09 (c)	2,730,000		2,457,000
9.875% 3/1/07 (c)	3,090,000		3,012,750
10.25% 6/15/11 (c)	1,935,000		1,944,675
Cablevision Systems Corp.:
6.6688% 4/1/09 (e)(f)	8,870,000		9,424,375
8% 4/15/12 (e)	4,120,000		4,382,650
CSC Holdings, Inc. 7.625% 4/1/11	2,950,000		3,186,000
DirecTV Holdings LLC/DirecTV Financing, Inc. 8.375% 3/15/13	5,765,000		6,456,800
EchoStar DBS Corp.:
5.75% 10/1/08	15,085,000		15,311,275
6.625% 10/1/14 (e)	7,590,000		7,703,850
GCI, Inc. 7.25% 2/15/14	3,425,000		3,425,000
NTL Cable PLC:
7.07% 10/15/12 (e)(f)	4,400,000		4,532,000
8.75% 4/15/14 (e)	1,635,000		1,839,375
Telenet Group Holding NV 0% 6/15/14 (d)(e)	5,505,000		4,183,800
			67,859,550
Capital Goods - 2.9%
Amsted Industries, Inc. 10.25% 10/15/11 (e)	2,860,000		3,246,100
Dresser, Inc. 9.375% 4/15/11	7,700,000		8,412,250
Invensys PLC 9.875% 3/15/11 (e)	15,105,000		16,313,400
Leucadia National Corp. 7% 8/15/13	5,775,000		5,948,250
Park-Ohio Industries, Inc. 8.375% 11/15/14 (e)	3,645,000		3,635,888
Sensus Metering Systems, Inc. 8.625% 12/15/13	3,370,000		3,471,100
SPX Corp.:
6.25% 6/15/11	3,100,000		3,270,500
7.5% 1/1/13	7,970,000		8,667,375
			52,964,863
Nonconvertible Bonds - continued
	Principal Amount		Value (Note 1)
Chemicals - 7.1%
BCP Caylux Holdings Luxembourg SCA 9.625% 6/15/14 (e)	$ 11,360,000		$ 12,723,200
Borden US Finance Corp./Nova Scotia Finance ULC:
6.82% 7/15/10 (e)(f)	3,490,000		3,647,050
9% 7/15/14 (e)	5,655,000		6,220,500
Equistar Chemicals LP 7.55% 2/15/26	8,495,000		8,346,338
Equistar Chemicals LP/Equistar Funding Corp.:
8.75% 2/15/09	4,535,000		5,033,850
10.125% 9/1/08	2,905,000		3,340,750
HMP Equity Holdings Corp. 0% 5/15/08	6,545,000		4,286,975
Huntsman ICI Chemicals LLC 10.125% 7/1/09	31,000		32,705
Huntsman ICI Holdings LLC 0% 12/31/09	8,015,000		4,528,475
Huntsman International LLC:
7.375% 1/1/15 (e)	5,010,000		5,047,575
9.875% 3/1/09	4,700,000		5,146,500
Huntsman LLC:
9.32% 7/15/11 (e)(f)	5,700,000		6,355,500
11.5% 7/15/12 (e)	5,555,000		6,527,125
Lubrizol Corp. 4.625% 10/1/09	6,100,000		6,090,588
Lyondell Chemical Co.:
9.5% 12/15/08	12,345,000		13,456,050
9.625% 5/1/07	1,260,000		1,382,850
10.875% 5/1/09	6,965,000		7,382,900
11.125% 7/15/12	4,320,000		5,108,400
Millennium America, Inc. 9.25% 6/15/08	11,420,000		12,904,600
NOVA Chemicals Corp.:
6.5% 1/15/12	6,255,000		6,599,025
7.4% 4/1/09	6,420,000		6,933,600
			131,094,556
Consumer Products - 0.7%
Church & Dwight Co., Inc. 6% 12/15/12 (e)	5,275,000		5,367,313
Jostens Holding Corp. 0% 12/1/13 (d)	3,050,000		2,165,500
Jostens IH Corp. 7.625% 10/1/12 (e)	1,970,000		2,068,500
Samsonite Corp. 8.875% 6/1/11	2,785,000		3,014,763
			12,616,076
Containers - 2.5%
Anchor Glass Container Corp. 11% 2/15/13	4,335,000		4,703,475
Berry Plastics Corp. 10.75% 7/15/12	3,700,000		4,227,250
BWAY Corp. 10% 10/15/10	6,685,000		7,119,525
Crown Cork & Seal, Inc. 8% 4/15/23	230,000		226,550

	Principal Amount		Value (Note 1)
Crown European Holdings SA:
9.5% 3/1/11	$ 1,405,000		$ 1,594,675
10.875% 3/1/13	7,905,000		9,347,663
Owens-Brockway Glass Container, Inc.:
8.25% 5/15/13	5,115,000		5,626,500
8.75% 11/15/12	1,750,000		1,964,375
8.875% 2/15/09	655,000		710,675
Owens-Illinois, Inc.:
7.35% 5/15/08	3,505,000		3,697,775
7.5% 5/15/10	6,140,000		6,516,075
			45,734,538
Diversified Media - 0.8%
Corus Entertainment, Inc. 8.75% 3/1/12	6,140,000		6,730,975
LBI Media Holdings, Inc. 0% 10/15/13 (d)	6,440,000		4,733,400
LBI Media, Inc. 10.125% 7/15/12	3,285,000		3,662,775
			15,127,150
Electric Utilities - 6.2%
AES Corp.:
7.75% 3/1/14	5,965,000		6,442,200
8.75% 6/15/08	3,068,000		3,344,120
8.875% 2/15/11	13,481,000		15,402,043
9.375% 9/15/10	6,433,000		7,438,156
9.5% 6/1/09	1,499,000		1,703,239
AES Gener SA 7.5% 3/25/14 (e)	4,200,000		4,420,500
Chivor SA E.S.P. 9.75% 12/30/14 (e)	2,060,000		2,142,400
CMS Energy Corp.:
7.5% 1/15/09	4,150,000		4,419,750
7.75% 8/1/10	1,970,000		2,154,688
8.5% 4/15/11	945,000		1,073,756
8.9% 7/15/08	2,180,000		2,406,175
9.875% 10/15/07	5,470,000		6,099,050
MSW Energy Holdings II LLC/MSW Finance Co. II, Inc. 7.375% 9/1/10	2,950,000		3,097,500
MSW Energy Holdings LLC/MSW Energy Finance Co., Inc. 8.5% 9/1/10	2,505,000		2,730,450
Nevada Power Co. 6.5% 4/15/12	4,225,000		4,467,938
NRG Energy, Inc. 8% 12/15/13 (e)	16,260,000		17,743,725
Sierra Pacific Power Co. 6.25% 4/15/12	4,100,000		4,274,250
Sierra Pacific Resources 8.625% 3/15/14	2,315,000		2,615,950
TECO Energy, Inc.:
7% 5/1/12	5,880,000		6,453,300
Nonconvertible Bonds - continued
	Principal Amount		Value (Note 1)
Electric Utilities - continued
TECO Energy, Inc.: - continued
7.2% 5/1/11	$ 11,040,000		$ 12,199,200
Texas Genco LLC/Texas Genco Financing Corp. 6.875% 12/15/14 (e)	4,260,000		4,430,400
			115,058,790
Energy - 6.2%
Belden & Blake Corp. 8.75% 7/15/12 (e)	3,350,000		3,425,375
Chesapeake Energy Corp.:
7.75% 1/15/15	6,100,000		6,649,000
8.125% 4/1/11	2,875,000		3,097,813
9% 8/15/12	1,920,000		2,181,600
El Paso Energy Corp. 6.95% 12/15/07	3,350,000		3,492,375
El Paso Production Holding Co. 7.75% 6/1/13	905,000		943,463
Hanover Compressor Co.:
0% 3/31/07	5,595,000		4,867,650
8.625% 12/15/10	1,450,000		1,580,500
9% 6/1/14	1,540,000		1,709,400
Hilcorp Energy I LP/Hilcorp Finance Co. 10.5% 9/1/10 (e)	5,810,000		6,565,300
Newfield Exploration Co. 6.625% 9/1/14 (e)	4,720,000		4,991,400
Parker Drilling Co.:
7.15% 9/1/10 (e)(f)	9,030,000		9,458,925
9.625% 10/1/13	1,505,000		1,691,244
Plains Exploration & Production Co.:
7.125% 6/15/14	295,000		323,025
8.75% 7/1/12	2,540,000		2,841,625
Pride International, Inc. 7.375% 7/15/14	7,845,000		8,551,050
Range Resources Corp. 7.375% 7/15/13	9,635,000		10,309,450
SESI LLC 8.875% 5/15/11	1,740,000		1,905,300
Sonat, Inc.:
6.625% 2/1/08	2,070,000		2,095,875
6.75% 10/1/07	800,000		840,000
7.625% 7/15/11	6,665,000		6,873,281
Stone Energy Corp. 6.75% 12/15/14 (e)	3,990,000		3,950,100
The Coastal Corp.:
6.375% 2/1/09	6,395,000		6,339,044
6.5% 6/1/08	4,840,000		4,864,200
7.75% 6/15/10	11,464,000		11,979,880
Venoco, Inc. 8.75% 12/15/11 (e)	3,230,000		3,326,900
			114,853,775

	Principal Amount		Value (Note 1)
Entertainment/Film - 0.3%
Cinemark, Inc. 0% 3/15/14 (d)	$ 7,415,000		$ 5,616,863
Environmental - 0.9%
Allied Waste North America, Inc.:
5.75% 2/15/11	5,175,000		4,864,500
6.375% 4/15/11	3,890,000		3,695,500
8.5% 12/1/08	3,690,000		3,929,850
8.875% 4/1/08	3,725,000		3,985,750
			16,475,600
Food and Drug Retail - 2.0%
Jean Coutu Group, Inc.:
7.625% 8/1/12 (e)	1,440,000		1,522,800
8.5% 8/1/14 (e)	4,195,000		4,299,875
Rite Aid Corp.:
6.875% 8/15/13	5,655,000		5,103,638
8.125% 5/1/10	1,120,000		1,181,600
9.25% 6/1/13	7,255,000		7,363,825
9.5% 2/15/11	4,655,000		5,120,500
Stater Brothers Holdings, Inc.:
5.99% 6/15/10 (f)	7,155,000		7,351,763
8.125% 6/15/12	4,185,000		4,436,100
			36,380,101
Food/Beverage/Tobacco - 2.9%
B&G Foods, Inc. 8% 10/1/11	3,310,000		3,525,150
Del Monte Corp.:
8.625% 12/15/12	3,375,000		3,763,125
9.25% 5/15/11	4,215,000		4,636,500
Dole Food Co., Inc. 7.25% 6/15/10	8,125,000		8,531,250
National Beef Packing Co. LLC/National Beef Finance Corp. 10.5% 8/1/11	3,830,000		3,964,050
Smithfield Foods, Inc.:
7% 8/1/11 (e)	4,050,000		4,323,375
7% 8/1/11	1,315,000		1,400,475
7.625% 2/15/08	1,800,000		1,926,000
7.75% 5/15/13	3,935,000		4,348,175
8% 10/15/09	1,510,000		1,668,550
Swift & Co. 10.125% 10/1/09	4,345,000		4,888,125
UAP Holding Corp. 0% 7/15/12 (d)(e)	6,050,000		4,749,250
United Agriculture Products, Inc. 8.25% 12/15/11 (e)	4,949,000		5,307,803
			53,031,828
Gaming - 4.4%
Chumash Casino & Resort Enterprise 9% 7/15/10 (e)	2,760,000		3,049,800
Mandalay Resort Group:
9.375% 2/15/10	4,655,000		5,399,800
10.25% 8/1/07	3,125,000		3,546,875
MGM MIRAGE:
6% 10/1/09	13,125,000		13,453,125
6.75% 9/1/12	6,750,000		7,121,250
Nonconvertible Bonds - continued
	Principal Amount		Value (Note 1)
Gaming - continued
MGM MIRAGE: - continued
6.875% 2/6/08	$ 2,140,000		$ 2,300,500
8.5% 9/15/10	4,125,000		4,723,125
Mohegan Tribal Gaming Authority:
6.375% 7/15/09	7,065,000		7,303,444
8% 4/1/12	2,220,000		2,422,575
MTR Gaming Group, Inc. 9.75% 4/1/10	3,605,000		3,965,500
Park Place Entertainment Corp. 7.875% 3/15/10	4,825,000		5,428,125
Scientific Games Corp. 6.25% 12/15/12 (e)	3,290,000		3,331,125
Seneca Gaming Corp. 7.25% 5/1/12	4,360,000		4,545,300
Venetian Casino Resort LLC/Las Vegas Sands, Inc. 11% 6/15/10	3,815,000		4,358,638
Virgin River Casino Corp./RBG LLC/B&BB, Inc.:
0% 1/15/13 (d)(e)	2,100,000		1,312,500
9% 1/15/12 (e)	1,555,000		1,617,200
Wheeling Island Gaming, Inc. 10.125% 12/15/09	6,730,000		7,167,450
			81,046,332
Healthcare - 6.2%
AmerisourceBergen Corp.:
7.25% 11/15/12	6,070,000		6,752,875
8.125% 9/1/08	1,735,000		1,930,188
CDRV Investors, Inc. 0% 1/1/15 (d)(e)	16,110,000		9,947,925
Concentra Operating Corp.:
9.125% 6/1/12 (e)	2,095,000		2,367,350
9.5% 8/15/10	2,145,000		2,423,850
Elan Finance PLC/Elan Finance Corp. 7.75% 11/15/11 (e)	6,320,000		6,762,400
Fisher Scientific International, Inc.:
6.75% 8/15/14 (e)	2,510,000		2,685,700
8% 9/1/13	2,870,000		3,257,450
8.125% 5/1/12	875,000		975,625
Genesis HealthCare Corp. 8% 10/15/13	8,105,000		8,793,925
HCA, Inc. 5.5% 12/1/09	5,000,000		5,004,700
Mayne Group Ltd. 5.875% 12/1/11 (e)	5,000,000		5,087,500
Omega Healthcare Investors, Inc.:
7% 4/1/14	3,970,000		4,089,100
7% 4/1/14 (e)	3,260,000		3,357,800
PerkinElmer, Inc. 8.875% 1/15/13	7,225,000		8,218,438
Psychiatric Solutions, Inc. 10.625% 6/15/13	6,335,000		7,332,763
Senior Housing Properties Trust 8.625% 1/15/12	9,170,000		10,476,725
Spheris, Inc. 11% 12/15/12 (e)	2,710,000		2,770,975
Tenet Healthcare Corp.:
6.375% 12/1/11	15,925,000		14,651,000

	Principal Amount		Value (Note 1)
6.5% 6/1/12	$ 1,275,000		$ 1,188,938
7.375% 2/1/13	4,305,000		4,197,375
9.875% 7/1/14 (e)	2,040,000		2,218,500
			114,491,102
Homebuilding/Real Estate - 4.1%
American Real Estate Partners/American Real Estate Finance Corp. 8.125% 6/1/12	13,630,000		14,532,988
Beazer Homes USA, Inc.:
6.5% 11/15/13	860,000		868,600
8.375% 4/15/12	5,975,000		6,572,500
D.R. Horton, Inc. 4.875% 1/15/10	1,635,000		1,626,825
K. Hovnanian Enterprises, Inc.:
6% 1/15/10 (e)	1,330,000		1,343,300
8.875% 4/1/12	2,210,000		2,431,000
KB Home 7.75% 2/1/10	9,585,000		10,303,875
Meritage Homes Corp. 7% 5/1/14	3,370,000		3,471,100
Standard Pacific Corp.:
5.125% 4/1/09	5,680,000		5,594,800
6.5% 10/1/08	5,480,000		5,754,000
6.875% 5/15/11	2,080,000		2,184,000
Technical Olympic USA, Inc.:
7.5% 3/15/11	5,110,000		5,110,000
9% 7/1/10	1,110,000		1,187,700
10.375% 7/1/12	4,125,000		4,620,000
WCI Communities, Inc.:
7.875% 10/1/13	2,605,000		2,741,763
10.625% 2/15/11	2,890,000		3,207,900
William Lyon Homes, Inc. 7.5% 2/15/14	4,895,000		4,699,200
			76,249,551
Hotels - 1.1%
Grupo Posadas SA de CV 8.75% 10/4/11 (e)	4,235,000		4,542,038
Host Marriott LP 7.125% 11/1/13	8,555,000		9,111,075
La Quinta Properties, Inc. 7% 8/15/12	5,950,000		6,336,750
			19,989,863
Insurance - 0.2%
Crum & Forster Holdings Corp. 10.375% 6/15/13	3,605,000		4,019,575
Leisure - 1.5%
Equinox Holdings Ltd. 9% 12/15/09	1,940,000		2,056,400
NCL Corp. Ltd. 10.625% 7/15/14 (e)	1,430,000		1,415,700
Town Sports International Holdings, Inc. 0% 2/1/14 (d)	3,870,000		2,051,100
Town Sports International, Inc. 9.625% 4/15/11	6,810,000		7,184,550
Nonconvertible Bonds - continued
	Principal Amount		Value (Note 1)
Leisure - continued
Universal City Development Partners Ltd./UCDP Finance, Inc. 11.75% 4/1/10	$ 8,900,000		$ 10,535,375
Universal City Florida Holding Co. I/II 7.2% 5/1/10 (e)(f)	3,675,000		3,812,813
			27,055,938
Metals/Mining - 1.9%
Century Aluminum Co. 7.5% 8/15/14 (e)	4,540,000		4,835,100
Compass Minerals International, Inc.:
0% 12/15/12 (d)	5,940,000		5,078,700
0% 6/1/13 (d)	9,470,000		7,670,700
Peabody Energy Corp. 6.875% 3/15/13	5,340,000		5,780,550
Ryerson Tull, Inc. 8.25% 12/15/11 (e)	3,320,000		3,394,700
Vedanta Resources PLC 6.625% 2/22/10 (e)	3,535,000		3,543,838
Wise Metals Group LLC/Alloys Finance 10.25% 5/15/12	4,815,000		4,815,000
			35,118,588
Paper - 1.6%
Cellu Tissue Holdings, Inc. 9.75% 3/15/10	3,435,000		3,572,400
Georgia-Pacific Corp.:
8% 1/15/14	3,675,000		4,180,313
8.125% 5/15/11	2,070,000		2,380,500
8.875% 2/1/10	485,000		564,419
9.375% 2/1/13	2,620,000		3,052,300
Norske Skog Canada Ltd.:
7.375% 3/1/14	4,150,000		4,326,375
8.625% 6/15/11	10,765,000		11,518,550
			29,594,857
Publishing/Printing - 1.2%
Dex Media West LLC/Dex Media West Finance Co. 5.875% 11/15/11 (e)	3,340,000		3,331,650
Houghton Mifflin Co. 9.875% 2/1/13	4,065,000		4,441,013
The Reader's Digest Association, Inc. 6.5% 3/1/11	12,945,000		13,527,525
			21,300,188
Railroad - 1.6%
Kansas City Southern Railway Co.:
7.5% 6/15/09	13,155,000		13,812,750
9.5% 10/1/08	150,000		168,750
TFM SA de CV yankee:
10.25% 6/15/07	505,000		540,350
11.75% 6/15/09	14,915,000		15,138,725
			29,660,575

	Principal Amount		Value (Note 1)
Restaurants - 0.5%
Friendly Ice Cream Corp. 8.375% 6/15/12	$ 4,760,000		$ 4,664,800
Landry's Seafood Restaurants, Inc. 7.5% 12/15/14 (e)	4,850,000		4,831,813
			9,496,613
Services - 0.2%
Iron Mountain, Inc. 8.625% 4/1/13	3,035,000		3,217,100
Shipping - 3.7%
General Maritime Corp. 10% 3/15/13	6,380,000		7,337,000
H-Lines Finance Holding Corp. 0% 4/1/13 (d)(e)	2,295,000		1,669,613
OMI Corp. 7.625% 12/1/13	9,595,000		10,266,650
Overseas Shipholding Group, Inc. 8.25% 3/15/13	1,795,000		1,996,938
Ship Finance International Ltd. 8.5% 12/15/13	25,180,000		25,935,379
Teekay Shipping Corp. 8.875% 7/15/11	17,723,000		20,558,680
			67,764,260
Steels - 2.0%
Allegheny Technologies, Inc. 8.375% 12/15/11	5,820,000		6,460,200
CSN Islands VII Corp. 10.75% 9/12/08 (e)	5,755,000		6,539,119
CSN Islands VIII Corp. 9.75% 12/16/13 (e)	3,100,000		3,317,000
Gerdau AmeriSteel Corp./GUSAP Partners 10.375% 7/15/11	10,130,000		11,902,750
Ispat Inland ULC 9.75% 4/1/14	6,622,000		8,178,170
			36,397,239
Super Retail - 1.8%
Asbury Automotive Group, Inc.:
8% 3/15/14	2,910,000		2,880,900
9% 6/15/12	9,895,000		10,414,488
NBC Acquisition Corp. 0% 3/15/13 (d)	1,665,000		1,215,450
Nebraska Book Co., Inc. 8.625% 3/15/12	2,530,000		2,580,600
Saks, Inc.:
8.25% 11/15/08	1,325,000		1,444,250
9.875% 10/1/11	7,130,000		8,413,400
Sonic Automotive, Inc. 8.625% 8/15/13	5,130,000		5,489,100
			32,438,188
Technology - 5.4%
Advanced Micro Devices, Inc. 7.75% 11/1/12 (e)	6,390,000		6,653,588
Celestica, Inc. 7.875% 7/1/11	13,125,000		14,043,750
Flextronics International Ltd.:
6.25% 11/15/14 (e)	11,465,000		11,350,350
6.5% 5/15/13	4,970,000		5,069,400
Nonconvertible Bonds - continued
	Principal Amount		Value (Note 1)
Technology - continued
Freescale Semiconductor, Inc.:
4.82% 7/15/09 (f)	$ 4,460,000		$ 4,660,700
6.875% 7/15/11	8,220,000		8,815,950
7.125% 7/15/14	1,585,000		1,719,725
Lucent Technologies, Inc.:
6.45% 3/15/29	5,885,000		5,355,350
6.5% 1/15/28	1,600,000		1,440,000
MagnaChip Semiconductor SA/MagnaChip Semiconductor Finance Co.:
5.78% 12/15/11 (e)(f)	1,170,000		1,200,713
8% 12/15/14 (e)	910,000		948,675
Sanmina-SCI Corp. 10.375% 1/15/10	3,265,000		3,738,425
Xerox Capital Trust I 8% 2/1/27	5,515,000		5,735,600
Xerox Corp.:
6.875% 8/15/11	14,110,000		15,027,150
7.2% 4/1/16	215,000		230,050
7.625% 6/15/13	11,340,000		12,474,000
9.75% 1/15/09	1,210,000		1,421,750
			99,885,176
Telecommunications - 9.3%
Alaska Communications Systems Holdings, Inc. 9.375% 5/15/09	4,935,000		5,083,050
Citizens Communications Co. 6.25% 1/15/13	6,580,000		6,645,800
Empresa Brasileira de Telecomm SA 11% 12/15/08	5,405,000		6,161,700
Intelsat Ltd.:
5.25% 11/1/08	2,035,000		1,986,669
6.5% 11/1/13	2,475,000		2,239,875
7.625% 4/15/12	6,265,000		6,171,025
Millicom International Cellular SA 10% 12/1/13 (e)	16,275,000		17,007,375
New Skies Satellites BV 7.4375% 11/1/11 (e)(f)	3,200,000		3,360,000
Nextel Communications, Inc.:
5.95% 3/15/14	7,470,000		7,806,150
6.875% 10/31/13	18,545,000		20,121,325
PanAmSat Corp. 9% 8/15/14 (e)	12,180,000		13,580,700
Qwest Capital Funding, Inc.:
7% 8/3/09	4,405,000		4,360,950
7.25% 2/15/11	1,685,000		1,617,600
Qwest Corp.:
7.875% 9/1/11 (e)	3,890,000		4,201,200
9.125% 3/15/12 (e)	16,255,000		18,774,525
Qwest Services Corp.:
14% 12/15/10 (e)(f)	4,345,000		5,214,000
14.5% 12/15/14 (e)(f)	4,610,000		5,774,025
Rogers Communications, Inc.:
5.525% 12/15/10 (e)(f)	3,140,000		3,289,150
7.25% 12/15/12 (e)	1,950,000		2,067,000

	Principal Amount		Value (Note 1)
8% 12/15/12 (e)	$ 2,230,000		$ 2,352,650
9.625% 5/1/11	6,340,000		7,386,100
SBA Communications Corp. 8.5% 12/1/12 (e)	6,015,000		6,150,338
Time Warner Telecom LLC/Time Warner Telecom, Inc. 9.75% 7/15/08	1,645,000		1,645,000
Time Warner Telecom, Inc. 10.125% 2/1/11	1,645,000		1,612,100
U.S. West Capital Funding, Inc. 6.375% 7/15/08	3,985,000		3,935,188
U.S. West Communications:
6.875% 9/15/33	3,270,000		3,008,400
7.2% 11/10/26	1,905,000		1,819,275
7.5% 6/15/23	8,635,000		8,483,888
			171,855,058
Textiles & Apparel - 0.6%
Levi Strauss & Co.:
9.75% 1/15/15 (e)	3,340,000		3,298,250
12.25% 12/15/12	7,210,000		8,003,100
			11,301,350
TOTAL NONCONVERTIBLE BONDS (Cost $1,589,202,187)		1,679,459,718
Commercial Mortgage Securities - 0.3%

Banc of America Commercial Mortgage, Inc. Series 2003-2:
Class BWD, 6.947% 10/11/37 (e)	614,920		622,899
Class BWE, 7.226% 10/11/37 (e)	831,540		841,685
Class BWF, 7.55% 10/11/37 (e)	734,087		744,541
Class BWG, 8.155% 10/11/37 (e)	710,012		714,921
Class BWH, 9.073% 10/11/37 (e)	371,348		380,282
Class BWJ, 9.99% 10/11/37 (e)	613,922		626,836
Class BWK, 10.676% 10/11/37 (e)	478,161		491,035
Class BWL, 10.1596% 10/11/37 (e)	797,600		755,788
LB Multi-family Mortgage Trust Series 1991-4 Class A1, 6.9974% 4/25/21 (e)(f)	229,583		204,329
TOTAL COMMERCIAL MORTGAGE SECURITIES (Cost $5,073,302)		5,382,316
Common Stocks - 0.2%
	Shares
Chemicals - 0.1%
HMP Equity Holdings Corp. warrants 5/15/11 (a)(e)	4,800		2,256,000
Common Stocks - continued
	Shares		Value (Note 1)
Homebuilding/Real Estate - 0.0%
Swerdlow Real Estate Group LLC (a)(g)	159,600		$ 377,326
Textiles & Apparel - 0.1%
Arena Brands Holding Corp. Class B (g)	48,889		506,001
TOTAL COMMON STOCKS (Cost $5,194,504)		3,139,327
Nonconvertible Preferred Stocks - 0.1%

Diversified Financial Services - 0.1%
Fannie Mae 7.00% (Cost $1,875,000)	37,500		2,109,375

Floating Rate Loans - 5.7%
	Principal Amount
Air Transportation - 0.2%
American Airlines, Inc. term loan 9.5% 12/17/10 (f)	$ 2,750,000		2,791,250
Cable TV - 0.9%
Hilton Head Communications LP Tranche B, term loan 6.5% 3/31/08 (f)	7,000,000		6,877,500
NTL Investment Holdings Ltd. Tranche B, term loan 5.2038% 6/13/12 (f)	3,850,000		3,888,500
Olympus Cable Holdings LLC Tranche A, term loan 6.5% 6/30/10 (f)	5,500,000		5,458,750
			16,224,750
Electric Utilities - 0.8%
Astoria Energy LLC term loan:
7.1882% 4/15/12 (f)	5,200,000		5,304,000
11.31% 4/15/12 (f)	3,340,000		3,423,500
Riverside Energy Center LLC:
term loan 6.38% 6/24/11 (f)	6,415,389		6,511,620
Credit-Linked Deposit 6.38% 6/24/11 (f)	284,611		288,880
			15,528,000
Energy - 1.3%
El Paso Corp.:
Credit-Linked Deposit 5.15% 11/22/09 (f)	5,839,400		5,883,196
term loan 5.1875% 11/22/09 (f)	6,491,050		6,547,847
Headwaters, Inc.:
Tranche 2, term loan 9.1133% 9/8/12 (f)	3,450,000		3,557,813
Tranche B1, term loan 7.5% 4/30/11 (f)	5,070,313		5,133,691
Magellan Midstream Holdings LP term loan 4.62% 12/10/11 (f)	3,550,000		3,594,375
			24,716,922

	Principal Amount		Value (Note 1)
Homebuilding/Real Estate - 1.4%
General Growth Properties, Inc.:
Tranche A, term loan 4.53% 11/12/07 (f)	$ 5,500,000		$ 5,500,000
Tranche B, term loan 4.53% 11/12/08 (f)	5,500,000		5,513,750
LNR Property Corp.:
Tranche A, term loan 7.09% 1/31/08 (f)	3,650,000		3,650,000
Tranche B, term loan:
5.59% 1/31/08 (f)	7,450,000		7,487,250
7.84% 1/31/08 (f)	3,700,000		3,700,000
			25,851,000
Hotels - 0.4%
Wyndham International, Inc. term loan 7.125% 6/30/06 (f)	7,927,451		7,947,269
Railroad - 0.1%
Kansas City Southern Railway Co. Tranche B1, term loan 4.0939% 3/30/08 (f)	1,150,000		1,167,250
Technology - 0.3%
ON Semiconductor Corp. Tranche G, term loan 5.5625% 12/15/11 (f)	5,550,000		5,563,875
Telecommunications - 0.3%
Qwest Corp. Tranche B, term loan 6.95% 6/30/10 (f)	4,500,000		4,601,250
TOTAL FLOATING RATE LOANS (Cost $101,652,062)		104,391,566

Money Market Funds - 2.2%
	Shares
Fidelity Cash Central Fund, 2.24% (b) (Cost $41,514,605)	41,514,605		41,514,605
Cash Equivalents - 0.2%
	Maturity Amount		Value (Note 1)
Investments in repurchase agreements (Collateralized by U.S. Treasury Obligations, in a joint trading account at 1.56%, dated 12/31/04 due 1/3/05) (Cost $3,171,000)	$ 3,171,414		$ 3,171,000
TOTAL INVESTMENT PORTFOLIO - 99.8% (Cost $1,747,682,660)			1,839,167,907
NET OTHER ASSETS - 0.2%			4,179,826
NET ASSETS - 100%		$ 1,843,347,733

Legend

(a) Non-income producing

(d) Debt obligation initially issued in zero coupon form which converts to coupon form at a specified rate and date. The rate shown is the rate at period end.

(f) The coupon rate shown on floating or adjustable rate securities represents the rate at period end.

(g) Restricted securities - Investment in securities not registered under the Securities Act of 1933 (excluding 144A issues). At the end of the period, the value of restricted securities (excluding 144A issues) amounted to $883,327 or 0.0% of net assets.

Additional information on each holding is as follows:

Security	Acquisition Date	Acquisition Cost
Arena Brands Holding Corp. Class B	6/18/97	$ 1,974,627
Swerdlow Real Estate Group LLC	1/15/99	$ 7,697,348

Other Information

Distribution of investments by country of issue, as a percentage of total net assets, is as follows:

United States of America	82.5%
Canada	5.2%
Marshall Islands	2.1%
Bermuda	1.9%
United Kingdom	1.7%
Luxembourg	1.6%
Mexico	1.1%
Others (individually less than 1%)	3.9%
	100.0%

Income Tax Information

At December 31, 2004, the fund had a capital loss carryforward of approximately $1,144,184,000 of which $283,149,000, $772,554,000 and $88,481,000 will expire on December 31, 2008, 2009 and 2010, respectively.

The fund will notify shareholders in January 2005 of amounts for use in preparing 2004 income tax returns.

See accompanying notes which are an integral part of the financial statements.

High Income Portfolio

Fidelity Variable Insurance Products: High Income Portfolio

Financial Statements

Statement of Assets and Liabilities

December 31, 2004

Assets
Investment in securities, at value (including repurchase agreements of $3,171,000) (cost $1,747,682,660) - See accompanying schedule		$ 1,839,167,907
Cash		100,076
Receivable for investments sold		7,236,480
Receivable for fund shares sold		278,188
Interest receivable		29,056,825
Prepaid expenses		6,674
Total assets		1,875,846,150
Liabilities
Payable for investments purchased	$ 29,800,521
Payable for fund shares redeemed	1,277,993
Accrued management fee	877,227
Distribution fees payable	49,768
Other affiliated payables	162,084
Other payables and accrued expenses	330,824
Total liabilities		32,498,417
Net Assets		$ 1,843,347,733
Net Assets consist of:
Paid in capital		$ 2,757,165,988
Undistributed net investment income		142,574,339
Accumulated undistributed net realized gain (loss) on investments		(1,147,878,584)
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies		91,485,990
Net Assets		$ 1,843,347,733
Calculation of Maximum Offering Price
Initial Class: Net Asset Value, offering price and redemption price per share ($1,371,736,328 ÷ 195,883,886 shares)		$ 7.00
Service Class: Net Asset Value, offering price and redemption price per share ($377,122,057 ÷ 54,083,772 shares)		$ 6.97
Service Class 2: Net Asset Value, offering price and redemption price per share ($94,246,211 ÷ 13,644,087 shares)		$ 6.91
Initial Class R: Net Asset Value, offering price and redemption price per share ($ 81,111 ÷ 11,592 shares)		$ 7.00
Service Class R: Net Asset Value, offering price and redemption price per share ($81,060 ÷ 11,628 shares)		$ 6.97
Service Class 2R: Net Asset Value, offering price and redemption price per share ($80,966 ÷ 11,719 shares)		$ 6.91

Statement of Operations

Year ended December 31, 2004

Investment Income
Dividends		$ 731,076
Interest		146,478,822
Total income		147,209,898

Expenses
Management fee	$ 10,407,413
Transfer agent fees	1,229,877
Distribution fees	542,218
Accounting fees and expenses	687,297
Non-interested trustees' compensation	10,249
Custodian fees and expenses	61,567
Registration fees	4,070
Audit	63,597
Legal	22,574
Interest	9,548
Miscellaneous	353,587
Total expenses before reductions	13,391,997
Expense reductions	(3,973)	13,388,024
Net investment income		133,821,874
Realized and Unrealized Gain (Loss) Net realized gain (loss) on investment securities		76,148,906
Change in net unrealized appreciation (depreciation) on: Investment securities	(47,643,714)
Assets and liabilities in foreign currencies	236
Total change in net unrealized appreciation (depreciation)		(47,643,478)
Net gain (loss)		28,505,428
Net increase (decrease) in net assets resulting from operations		$ 162,327,302

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products: High Income Portfolio
Financial Statements - continued

Statement of Changes in Net Assets

	Year ended December 31, 2004	Year ended December 31, 2003
Increase (Decrease) in Net Assets
Operations
Net investment income	$ 133,821,874	$ 147,560,195
Net realized gain (loss)	76,148,906	93,505,636
Change in net unrealized appreciation (depreciation)	(47,643,478)	182,813,372
Net increase (decrease) in net assets resulting from operations	162,327,302	423,879,203
Distributions to shareholders from net investment income	(155,517,698)	(110,937,981)
Share transactions - net increase (decrease)	(251,486,736)	336,533,161
Total increase (decrease) in net assets	(244,677,132)	649,474,383

Net Assets
Beginning of period	2,088,024,865	1,438,550,482
End of period (including undistributed net investment income of $142,574,339 and undistributed net investment income of $164,989,590, respectively)	$ 1,843,347,733	$ 2,088,024,865

Other Information:
Share Transactions	Year ended December 31, 2004
Shares	Initial Class	Service Class	Service Class 2	Initial Class R^A	Service Class R^A	Service Class 2R^A
Sold	49,439,043	27,666,450	11,342,466	11,592	11,628	11,719
Reinvested	18,412,464	4,720,558	928,353	-	-	-
Redeemed	(101,334,787)	(38,719,734)	(9,747,785)	-	-	-
Net increase (decrease)	(33,483,280)	(6,332,726)	2,523,034	11,592	11,628	11,719

Dollars Sold	$ 326,369,917	$ 182,792,007	$ 74,778,966	$ 75,000	$ 75,000	$ 75,000
Reinvested	119,128,639	30,447,599	5,941,460	-	-	-
Redeemed	(672,513,946)	(255,556,875)	(63,099,503)	-	-	-
Net increase (decrease)	$ (227,015,390)	$ (42,317,269)	$ 17,620,923	$ 75,000	$ 75,000	$ 75,000

Share Transactions	Year ended December 31, 2003
Shares	Initial Class	Service Class	Service Class 2	Initial Class R	Service Class R	Service Class 2R
Sold	187,111,620	59,201,139	17,709,351	$ -	$ -	$ -
Reinvested	15,863,052	3,574,368	424,961	-	-	-
Redeemed	(166,651,099)	(46,461,897)	(12,553,214)	-	-	-
Net increase (decrease)	36,323,573	16,313,610	5,581,098	$ -	$ -	$ -

Dollars Sold	$ 1,162,830,605	$ 370,826,801	$ 111,025,684	$ -	$ -	$ -
Reinvested	88,674,463	19,909,232	2,354,286	-	-	-
Redeemed	(1,045,910,689)	(293,649,573)	(79,527,648)	-	-	-
Net increase (decrease)	$ 205,594,379	$ 97,086,460	$ 33,852,322	$ -	$ -	$ -

Distributions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2	Initial Class R^A	Service Class R^A	Service Class 2R^A
From net investment income	$ 119,128,639	$ 30,447,599	$ 5,941,460	$ -	$ -	$ -

	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2	Initial Class R	Service Class R	Service Class 2R
From net investment income	$ 88,674,463	$ 19,909,232	$ 2,354,286	$ -	$ -	$ -

^A For the period April 14, 2004 (commencement of sale of shares) to December 31, 2004.

See accompanying notes which are an integral part of the financial statements.

High Income Portfolio

Financial Highlights - Initial Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 6.95	$ 5.93	$ 6.41	$ 8.18	$ 11.32
Income from Investment Operations
Net investment income^C	.494	.520	.496^F	.774^{E, F}	1.123
Net realized and unrealized gain (loss)	.126	.980	(.306)^F	(1.544)^{E, F}	(3.513)
Total from investment operations	.620	1.500	.190	(.770)	(2.390)
Distributions from net investment income	(.570)	(.480)	(.670)	(1.000)	(.750)
Net asset value, end of period	$ 7.00	$ 6.95	$ 5.93	$ 6.41	$ 8.18
Total Return^{A, B}	9.59%	27.26%	3.44%	(11.73)%	(22.54)%
Ratios to Average Net Assets^D
Expenses before expense reductions	.71%	.69%	.70%	.71%	.68%
Expenses net of voluntary waivers, if any	.71%	.69%	.70%	.71%	.68%
Expenses net of all reductions	.71%	.69%	.70%	.70%	.68%
Net investment income	7.43%	8.25%	8.65%^F	11.00%^{E, F}	11.38%
Supplemental Data
Net assets, end of period (000 omitted)	$ 1,371,736	$ 1,593,714	$ 1,145,562	$ 1,201,085	$ 1,467,250
Portfolio turnover rate	128%	130%	96%	138%	68%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^E Effective January 1, 2001, the fund adopted the provisions of the AICPA Audit and Accounting Guide for Investment Companies and began amortizing premium and discount on all debt securities. Per-share data and ratios for periods prior to adoption have not been restated to reflect this change.

^F As a result of a revision to reflect accretion of market discount using the interest method, certain amounts for the years ended December 31, 2002 and December 31, 2001 have been reclassified from what was previously reported. The impact of this change for the years ended December 31, 2002 and December 31, 2001 was a decrease to net investment income of $.017 and $.075 per share with a corresponding increase to net realized and unrealized gain (loss) per share, respectively. The ratio of net investment income to average net assets decreased from 8.95% and 12.08% to 8.65% and 11.00%, respectively. The reclassification has no impact on the net assets of the fund.

Financial Highlights - Service Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 6.92	$ 5.91	$ 6.38	$ 8.15	$ 11.29
Income from Investment Operations
Net investment income^C	.486	.513	.488^F	.758^{E, F}	1.102
Net realized and unrealized gain (loss)	.124	.967	(.288)^F	(1.538)^{E, F}	(3.502)
Total from investment operations	.610	1.480	.200	(.780)	(2.400)
Distributions from net investment income	(.560)	(.470)	(.670)	(.990)	(.740)
Net asset value, end of period	$ 6.97	$ 6.92	$ 5.91	$ 6.38	$ 8.15
Total Return^{A, B}	9.47%	26.97%	3.62%	(11.90)%	(22.68)%
Ratios to Average Net Assets^D
Expenses before expense reductions	.81%	.79%	.80%	.81%	.78%
Expenses net of voluntary waivers, if any	.81%	.79%	.80%	.81%	.78%
Expenses net of all reductions	.81%	.79%	.80%	.81%	.78%
Net investment income	7.33%	8.15%	8.55%^F	10.90%^{E, F}	11.28%
Supplemental Data
Net assets, end of period (000 omitted)	$ 377,122	$ 417,928	$ 260,489	$ 234,204	$ 227,549
Portfolio turnover rate	128%	130%	96%	138%	68%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^F As a result of a revision to reflect accretion of market discount using the interest method, certain amounts for the years ended December 31, 2002 and December 31, 2001 have been reclassified from what was previously reported. The impact of this change for the years ended December 31, 2002 and December 31, 2001 was a decrease to net investment income of $.017 and $.075 per share with a corresponding increase to net realized and unrealized gain (loss) per share, respectively. The ratio of net investment income to average net assets decreased from 8.85% and 11.97% to 8.55% and 10.90%, respectively. The reclassification has no impact on the net assets of the fund.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Service Class 2

Years ended December 31,	2004	2003	2002	2001	2000^F
Selected Per-Share Data
Net asset value, beginning of period	$ 6.87	$ 5.87	$ 6.36	$ 8.13	$ 11.14
Income from Investment Operations
Net investment income^E	.470	.501	.472^I	.716^{H, I}	.936
Net realized and unrealized gain (loss)	.130	.959	(.292)^I	(1.496)^{H, I}	(3.206)
Total from investment operations	.600	1.460	.180	(.780)	(2.270)
Distributions from net investment income	(.560)	(.460)	(.670)	(.990)	(.740)
Net asset value, end of period	$ 6.91	$ 6.87	$ 5.87	$ 6.36	$ 8.13
Total Return^{B, C, D}	9.38%	26.75%	3.30%	(11.93)%	(21.83)%
Ratios to Average Net Assets^G
Expenses before expense reductions	.97%	.95%	.97%	.98%	1.01%^A
Expenses net of voluntary waivers, if any	.97%	.95%	.97%	.98%	1.01%^A
Expenses net of all reductions	.97%	.95%	.97%	.98%	1.01%^A
Net investment income	7.17%	7.99%	8.38%^I	10.73%^{H, I}	11.04%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 94,246	$ 76,383	$ 32,499	$ 16,508	$ 4,742
Portfolio turnover rate	128%	130%	96%	138%	68%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F For the period January 12, 2000 (commencement of sale of shares) to December 31, 2000.

^H Effective January 1, 2001, the fund adopted the provisions of the AICPA Audit and Accounting Guide for Investment Companies and began amortizing premium and discount on all debt securities. Per-share data and ratios for periods prior to adoption have not been restated to reflect this change.

^I As a result of a revision to reflect accretion of market discount using the interest method, certain amounts for the years ended December 31, 2002 and December 31, 2001 have been reclassified from what was previously reported. The impact of this change for the years ended December 31, 2002 and December 31, 2001 was a decrease to net investment income of $.017 and $.072 per share with a corresponding increase to net realized and unrealized gain (loss) per share, respectively. The ratio of net investment income to average net assets decreased from 8.68% and 11.81% to 8.38% and 10.73%, respectively. The reclassification has no impact on the net assets of the fund.

Financial Highlights - Initial Class R

Year ended December 31,	2004^F
Selected Per-Share Data
Net asset value, beginning of period	$ 6.47
Income from Investment Operations
Net investment income^E	.338
Net realized and unrealized gain (loss)	.192
Total from investment operations	.530
Net asset value, end of period	$ 7.00
Total Return^{B, C, D}	8.19%
Ratios to Average Net Assets^G
Expenses before expense reductions	.71%^A
Expenses net of voluntary waivers, if any	.71%^A
Expenses net of all reductions	.71%^A
Net investment income	7.16%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 81
Portfolio turnover rate	128%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F For the period April 14, 2004 (commencement of sale of shares) to December 31, 2004.

See accompanying notes which are an integral part of the financial statements.

High Income Portfolio

Financial Highlights - Service Class R

Year ended December 31,	2004^F
Selected Per-Share Data
Net asset value, beginning of period	$ 6.45
Income from Investment Operations
Net investment income^E	.332
Net realized and unrealized gain (loss)	.188
Total from investment operations	.520
Net asset value, end of period	$ 6.97
Total Return^{B, C, D}	8.06%
Ratios to Average Net Assets^G
Expenses before expense reductions	.81%^A
Expenses net of voluntary waivers, if any	.81%^A
Expenses net of all reductions	.81%^A
Net investment income	7.05%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 81
Portfolio turnover rate	128%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F For the period April 14, 2004 (commencement of sale of shares) to December 31, 2004.

Financial Highlights - Service Class 2R

Year ended December 31,	2004^F
Selected Per-Share Data
Net asset value, beginning of period	$ 6.40
Income from Investment Operations
Net investment income^E	.322
Net realized and unrealized gain (loss)	.188
Total from investment operations	.510
Net asset value, end of period	$ 6.91
Total Return^{B, C, D}	7.97%
Ratios to Average Net Assets^G
Expenses before expense reductions	.96%^A
Expenses net of voluntary waivers, if any	.96%^A
Expenses net of all reductions	.96%^A
Net investment income	6.90%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 81
Portfolio turnover rate	128%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F For the period April 14, 2004 (commencement of sale of shares) to December 31, 2004.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products: Index 500 Portfolio

Performance: The Bottom Line

Average annual total return reflects the change in the value of an investment, assuming reinvestment of a class' dividend income and capital gains (the profits earned upon the sale of securities that have grown in value) and assuming a constant rate of performance each year. During periods of reimbursement by Fidelity, a fund's total return will be greater than it would be had the reimbursement not occurred. Performance numbers are net of all underlying fund operating expenses, but do not include any insurance charges imposed by your insurance company's separate account. If performance information included the effect of these additional charges, the total returns would be lower. How a fund did yesterday is no guarantee of how it will do tomorrow.

Average Annual Total Returns

Periods ended December 31, 2004	Past 1 year	Past 5 years	Past 10 years
Fidelity® VIP: Index 500 - Initial Class	10.62%	-2.51%	11.78%
Fidelity VIP: Index 500 - Service Class^A	10.51%	-2.60%	11.73%
Fidelity VIP: Index 500 - Service Class 2^B	10.34%	-2.76%	11.64%

^A The initial offering of Service Class shares took place on July 7, 2000. Performance for Service Class shares reflects an asset-based service fee (12b-1 fee), and returns prior to July 7, 2000 are those of Initial Class and do not include the effects of Service Class' 12b-1 fee. Had Service Class shares' 12b-1 fee been reflected, returns prior to July 7, 2000 would have been lower.

^B The initial offering of Service Class 2 shares took place on January 12, 2000. Performance for Service Class 2 shares reflects an asset-based service fee (12b-1 fee), and returns prior to January 12, 2000 are those of Initial Class and do not include the effects of Service Class 2's 12b-1 fee. Had Service Class 2 shares' 12b-1 fee been reflected, returns prior to January 12, 2000 would have been lower.

$10,000 Over 10 Years

Let's say hypothetically that $10,000 was invested in Fidelity® Variable Insurance Products: Index 500 Portfolio - Initial Class on December 31, 1994. The chart shows how the value of your investment would have changed, and also shows how the S&P 500® Index performed over the same period.

Annual Report

Fidelity Variable Insurance Products: Index 500 Portfolio

Management's Discussion of Fund Performance

Comments from Jacques Perold, Portfolio Manager of Fidelity® Variable Insurance Products: Index 500 Portfolio

For the 12 months ending December 31, 2004, the fund's performance was in line with the S&P 500® and the Lipper^SM Variable Annuity S&P 500 Index Objective Funds Average, which returned 10.35%. Rising oil prices helped energy companies such as Exxon Mobil and ChevronTexaco generate stronger earnings and stock performance. Internet portal Yahoo! benefited from better advertising sales and steady growth in paid subscribers, while online auction house eBay continued to see extremely rapid growth. Intel, the world's leading maker of semiconductors, was a significant underperformer. Intel's stock price slid for most of the period after announcing a second-quarter decline in profit margins and an increase in inventories - signaling potential weakness in the cyclical semiconductor industry. Cisco Systems, which makes Internet routing equipment, saw its stock fall on a negative prognosis for the company's future sales growth, a summertime increase in inventories and indications of a slowdown in technology spending. Large-cap pharmaceutical stocks such as Merck and Pfizer encountered a difficult environment. Both companies were hurt by significant safety concerns about their leading pain management drugs.

Annual Report

Fidelity Variable Insurance Products: Index 500 Portfolio

Investment Summary

Top Ten Stocks as of December 31, 2004
	% of fund's net assets
General Electric Co.	3.4
Exxon Mobil Corp.	2.9
Microsoft Corp.	2.6
Citigroup, Inc.	2.2
Wal-Mart Stores, Inc.	2.0
Pfizer, Inc.	1.8
Bank of America Corp.	1.7
Johnson & Johnson	1.7
American International Group, Inc.	1.5
International Business Machines Corp.	1.4
	21.2
Market Sectors as of December 31, 2004
	% of fund's net assets
Financials	20.4
Information Technology	15.9
Health Care	12.6
Consumer Discretionary	11.8
Industrials	11.7
Consumer Staples	10.4
Energy	7.1
Telecommunication Services	3.2
Materials	3.1
Utilities	2.9

Annual Report

Fidelity Variable Insurance Products: Index 500 Portfolio

Investments December 31, 2004

Showing Percentage of Net Assets

Common Stocks - 99.1%
	Shares		Value (Note 1)
CONSUMER DISCRETIONARY - 11.8%
Auto Components - 0.2%
Cooper Tire & Rubber Co.	19,111		$ 411,842
Dana Corp.	38,237		662,647
Delphi Corp.	143,253		1,292,142
Goodyear Tire & Rubber Co. (a)	44,767		656,284
Johnson Controls, Inc.	48,589		3,082,486
Visteon Corp.	33,066		323,055
			6,428,456
Automobiles - 0.6%
Ford Motor Co.	467,051		6,837,627
General Motors Corp.	144,180		5,775,851
Harley-Davidson, Inc.	74,996		4,556,007
			17,169,485
Distributors - 0.1%
Genuine Parts Co.	44,577		1,964,063
Hotels, Restaurants & Leisure - 1.6%
Carnival Corp. unit	161,652		9,316,005
Darden Restaurants, Inc.	40,132		1,113,262
Harrah's Entertainment, Inc.	28,607		1,913,522
Hilton Hotels Corp.	98,539		2,240,777
International Game Technology	87,973		3,024,512
Marriott International, Inc. Class A	57,080		3,594,898
McDonald's Corp.	320,921		10,288,727
Starbucks Corp. (a)	102,100		6,366,956
Starwood Hotels & Resorts Worldwide, Inc. unit	52,911		3,090,002
Wendy's International, Inc.	29,095		1,142,270
Yum! Brands, Inc.	74,775		3,527,885
			45,618,816
Household Durables - 0.5%
Black & Decker Corp.	20,610		1,820,481
Centex Corp.	31,728		1,890,354
Fortune Brands, Inc.	36,797		2,839,992
KB Home	11,824		1,234,426
Leggett & Platt, Inc.	48,730		1,385,394
Maytag Corp.	20,222		426,684
Newell Rubbermaid, Inc.	70,147		1,696,856
Pulte Homes, Inc.	32,560		2,077,328
Snap-On, Inc.	14,688		504,680
The Stanley Works	20,998		1,028,692
Whirlpool Corp.	16,956		1,173,525
			16,078,412
Internet & Catalog Retail - 0.7%
eBay, Inc. (a)	169,217		19,676,553
Leisure Equipment & Products - 0.2%
Brunswick Corp.	24,557		1,215,572
Eastman Kodak Co.	73,179		2,360,023
Hasbro, Inc.	45,186		875,705
Mattel, Inc.	105,927		2,064,517
			6,515,817

	Shares		Value (Note 1)
Media - 3.9%
Clear Channel Communications, Inc.	146,404		$ 4,903,070
Comcast Corp. Class A (a)	566,661		18,858,478
Dow Jones & Co., Inc.	20,917		900,686
Gannett Co., Inc.	65,157		5,323,327
Interpublic Group of Companies, Inc. (a)	107,949		1,446,517
Knight-Ridder, Inc.	19,657		1,315,840
McGraw-Hill Companies, Inc.	48,475		4,437,402
Meredith Corp.	12,763		691,755
News Corp. Class A	666,932		12,444,951
Omnicom Group, Inc.	47,563		4,010,512
The New York Times Co. Class A	37,032		1,510,906
Time Warner, Inc. (a)	1,169,210		22,729,442
Tribune Co.	81,100		3,417,554
Univision Communications, Inc. Class A (a)	82,503		2,414,863
Viacom, Inc. Class B (non-vtg.)	435,235		15,838,202
Walt Disney Co.	521,579		14,499,896
			114,743,401
Multiline Retail - 1.1%
Big Lots, Inc. (a)	28,810		349,465
Dillard's, Inc. Class A	20,964		563,303
Dollar General Corp.	83,642		1,737,244
Family Dollar Stores, Inc.	42,805		1,336,800
Federated Department Stores, Inc.	43,192		2,496,066
JCPenney Co., Inc.	72,905		3,018,267
Kohl's Corp. (a)	87,579		4,306,259
Nordstrom, Inc.	35,757		1,670,925
Sears, Roebuck & Co.	52,793		2,694,027
Target Corp.	228,571		11,869,692
The May Department Stores Co.	74,534		2,191,300
			32,233,348
Specialty Retail - 2.4%
AutoNation, Inc. (a)	67,536		1,297,367
AutoZone, Inc. (a)	20,367		1,859,711
Bed Bath & Beyond, Inc. (a)	76,817		3,059,621
Best Buy Co., Inc.	82,807		4,920,392
Circuit City Stores, Inc.	49,882		780,154
Gap, Inc.	223,801		4,726,677
Home Depot, Inc.	560,551		23,957,950
Limited Brands, Inc.	103,746		2,388,233
Lowe's Companies, Inc.	197,259		11,360,146
Office Depot, Inc. (a)	79,748		1,384,425
OfficeMax, Inc. Delaware	23,856		748,601
RadioShack Corp.	40,452		1,330,062
Sherwin-Williams Co.	36,081		1,610,295
Staples, Inc.	127,097		4,284,440
Tiffany & Co., Inc.	37,141		1,187,398
TJX Companies, Inc.	123,005		3,091,116
Toys 'R' Us, Inc. (a)	54,897		1,123,742
			69,110,330
Textiles, Apparel & Luxury Goods - 0.5%
Coach, Inc. (a)	48,223		2,719,777
Common Stocks - continued
	Shares		Value (Note 1)
CONSUMER DISCRETIONARY - continued
Textiles, Apparel & Luxury Goods - continued
Jones Apparel Group, Inc.	31,199		$ 1,140,947
Liz Claiborne, Inc.	27,709		1,169,597
NIKE, Inc. Class B	67,001		6,076,321
Reebok International Ltd.	14,837		652,828
VF Corp.	28,354		1,570,245
			13,329,715
TOTAL CONSUMER DISCRETIONARY			342,868,396
CONSUMER STAPLES - 10.4%
Beverages - 2.2%
Adolph Coors Co. Class B	9,554		722,951
Anheuser-Busch Companies, Inc.	201,677		10,231,074
Brown-Forman Corp. Class B (non-vtg.)	31,088		1,513,364
Coca-Cola Enterprises, Inc.	119,777		2,497,350
Pepsi Bottling Group, Inc.	63,837		1,726,152
PepsiCo, Inc.	429,989		22,445,426
The Coca-Cola Co.	617,598		25,710,605
			64,846,922
Food & Staples Retailing - 3.2%
Albertsons, Inc.	93,952		2,243,574
Costco Wholesale Corp.	119,738		5,796,517
CVS Corp.	102,123		4,602,684
Kroger Co. (a)	188,668		3,309,237
Safeway, Inc. (a)	114,231		2,254,920
SUPERVALU, Inc.	34,270		1,183,000
Sysco Corp.	163,317		6,233,810
Wal-Mart Stores, Inc.	1,081,014		57,099,159
Walgreen Co.	260,876		10,009,812
			92,732,713
Food Products - 1.3%
Archer-Daniels-Midland Co.	167,074		3,727,421
Campbell Soup Co.	105,032		3,139,406
ConAgra Foods, Inc.	131,282		3,866,255
General Mills, Inc.	93,007		4,623,378
H.J. Heinz Co.	89,171		3,476,777
Hershey Foods Corp.	62,816		3,488,801
Kellogg Co.	105,402		4,707,253
McCormick & Co., Inc. (non-vtg.)	34,899		1,347,101
Sara Lee Corp.	200,335		4,836,087
Wm. Wrigley Jr. Co.	57,291		3,963,964
			37,176,443
Household Products - 1.8%
Clorox Co.	38,798		2,286,366
Colgate-Palmolive Co.	135,363		6,925,171
Kimberly-Clark Corp.	124,499		8,193,279
Procter & Gamble Co.	647,527		35,665,787
			53,070,603
Personal Products - 0.6%
Alberto-Culver Co.	23,231		1,128,330

	Shares		Value (Note 1)
Avon Products, Inc.	120,728		$ 4,672,174
Gillette Co.	253,430		11,348,595
			17,149,099
Tobacco - 1.3%
Altria Group, Inc.	523,952		32,013,467
Reynolds American, Inc.	37,666		2,960,548
UST, Inc.	42,178		2,029,184
			37,003,199
TOTAL CONSUMER STAPLES			301,978,979
ENERGY - 7.1%
Energy Equipment & Services - 1.0%
Baker Hughes, Inc.	85,634		3,654,003
BJ Services Co.	41,227		1,918,705
Halliburton Co.	112,821		4,427,096
Nabors Industries Ltd. (a)	38,165		1,957,483
Noble Corp. (a)	34,554		1,718,716
Rowan Companies, Inc. (a)	27,373		708,961
Schlumberger Ltd. (NY Shares)	150,286		10,061,648
Transocean, Inc. (a)	82,085		3,479,583
			27,926,195
Oil & Gas - 6.1%
Amerada Hess Corp.	23,396		1,927,362
Anadarko Petroleum Corp.	63,136		4,091,844
Apache Corp.	83,337		4,214,352
Ashland, Inc.	18,141		1,059,072
Burlington Resources, Inc.	99,936		4,347,216
ChevronTexaco Corp.	540,808		28,397,828
ConocoPhillips	176,192		15,298,751
Devon Energy Corp.	124,064		4,828,571
El Paso Corp.	164,193		1,707,607
EOG Resources, Inc.	30,268		2,159,924
Exxon Mobil Corp.	1,646,791		84,414,507
Kerr-McGee Corp.	38,722		2,237,744
Kinder Morgan, Inc.	31,622		2,312,517
Marathon Oil Corp.	88,466		3,327,206
Occidental Petroleum Corp.	100,759		5,880,295
Sunoco, Inc.	18,667		1,525,281
Unocal Corp.	67,181		2,904,906
Valero Energy Corp.	65,511		2,974,199
Williams Companies, Inc.	142,043		2,313,880
XTO Energy, Inc.	66,480		2,352,062
			178,275,124
TOTAL ENERGY			206,201,319
FINANCIALS - 20.4%
Capital Markets - 2.8%
Bank of New York Co., Inc.	198,316		6,627,721
Bear Stearns Companies, Inc.	26,355		2,696,380
Charles Schwab Corp.	343,836		4,112,279
E*TRADE Financial Corp. (a)	94,935		1,419,278
Common Stocks - continued
	Shares		Value (Note 1)
FINANCIALS - continued
Capital Markets - continued
Federated Investors, Inc. Class B (non-vtg.)	27,430		$ 833,872
Franklin Resources, Inc.	63,659		4,433,849
Goldman Sachs Group, Inc.	123,596		12,858,928
Janus Capital Group, Inc.	60,316		1,013,912
Lehman Brothers Holdings, Inc.	68,773		6,016,262
Mellon Financial Corp.	108,117		3,363,520
Merrill Lynch & Co., Inc.	237,757		14,210,736
Morgan Stanley	279,406		15,512,621
Northern Trust Corp.	55,956		2,718,342
State Street Corp.	85,108		4,180,505
T. Rowe Price Group, Inc.	32,711		2,034,624
			82,032,829
Commercial Banks - 5.9%
AmSouth Bancorp.	90,645		2,347,706
Bank of America Corp.	1,031,061		48,449,556
BB&T Corp.	141,000		5,929,050
Comerica, Inc.	43,538		2,656,689
Compass Bancshares, Inc.	31,308		1,523,760
Fifth Third Bancorp	143,278		6,774,184
First Horizon National Corp.	31,430		1,354,947
Huntington Bancshares, Inc.	58,993		1,461,847
KeyCorp	103,795		3,518,651
M&T Bank Corp.	29,646		3,197,025
Marshall & Ilsley Corp.	57,034		2,520,903
National City Corp.	172,952		6,494,348
North Fork Bancorp, Inc., New York	120,139		3,466,010
PNC Financial Services Group, Inc.	72,148		4,144,181
Regions Financial Corp. New	118,645		4,222,576
SunTrust Banks, Inc.	94,646		6,992,446
Synovus Financial Corp.	79,043		2,259,049
U.S. Bancorp, Delaware	476,620		14,927,738
Wachovia Corp.	409,353		21,531,968
Wells Fargo & Co.	431,875		26,841,031
Zions Bancorp	22,888		1,557,071
			172,170,736
Consumer Finance - 1.4%
American Express Co.	320,406		18,061,286
Capital One Financial Corp.	61,957		5,217,399
MBNA Corp.	326,146		9,194,056
Providian Financial Corp. (a)	74,822		1,232,318
SLM Corp.	109,720		5,857,951
			39,563,010
Diversified Financial Services - 3.7%
CIT Group, Inc.	53,652		2,458,335
Citigroup, Inc.	1,324,763		63,827,081
J.P. Morgan Chase & Co.	909,372		35,474,602

	Shares		Value (Note 1)
Moody's Corp.	37,754		$ 3,278,935
Principal Financial Group, Inc.	78,356		3,207,895
			108,246,848
Insurance - 4.2%
ACE Ltd.	72,546		3,101,342
AFLAC, Inc.	129,160		5,145,734
Allstate Corp.	175,166		9,059,586
AMBAC Financial Group, Inc.	27,739		2,278,204
American International Group, Inc.	664,856		43,661,094
Aon Corp.	80,780		1,927,411
Cincinnati Financial Corp.	42,897		1,898,621
Hartford Financial Services Group, Inc.	74,974		5,196,448
Jefferson-Pilot Corp.	34,849		1,810,754
Lincoln National Corp.	44,569		2,080,481
Loews Corp.	47,351		3,328,775
Marsh & McLennan Companies, Inc.	134,506		4,425,247
MBIA, Inc.	35,922		2,273,144
MetLife, Inc.	190,003		7,697,022
Progressive Corp.	51,105		4,335,748
Prudential Financial, Inc.	130,951		7,197,067
SAFECO Corp.	32,375		1,691,270
St. Paul Travelers Companies, Inc.	170,890		6,334,892
The Chubb Corp.	48,899		3,760,333
Torchmark Corp.	27,596		1,576,835
UnumProvident Corp.	75,684		1,357,771
XL Capital Ltd. Class A	35,394		2,748,344
			122,886,123
Real Estate - 0.5%
Apartment Investment & Management Co. Class A	24,194		932,437
Archstone-Smith Trust	49,951		1,913,123
Equity Office Properties Trust	102,933		2,997,409
Equity Residential (SBI)	72,180		2,611,472
Plum Creek Timber Co., Inc.	46,859		1,801,260
ProLogis	46,943		2,034,040
Simon Property Group, Inc.	56,456		3,651,010
			15,940,751
Thrifts & Mortgage Finance - 1.9%
Countrywide Financial Corp.	148,160		5,483,402
Fannie Mae	247,072		17,593,997
Freddie Mac	176,016		12,972,379
Golden West Financial Corp., Delaware	78,164		4,800,833
MGIC Investment Corp.	24,704		1,702,353
Sovereign Bancorp, Inc.	88,117		1,987,038
Washington Mutual, Inc.	222,867		9,422,817
			53,962,819
TOTAL FINANCIALS			594,803,116
HEALTH CARE - 12.6%
Biotechnology - 1.3%
Amgen, Inc. (a)	324,221		20,798,777
Common Stocks - continued
	Shares		Value (Note 1)
HEALTH CARE - continued
Biotechnology - continued
Applera Corp. - Applied Biosystems Group	50,038		$ 1,046,295
Biogen Idec, Inc. (a)	85,144		5,671,442
Chiron Corp. (a)	47,694		1,589,641
Genzyme Corp. - General Division (a)	63,273		3,674,263
Gilead Sciences, Inc. (a)	110,508		3,866,675
MedImmune, Inc. (a)	63,490		1,721,214
			38,368,307
Health Care Equipment & Supplies - 2.2%
Bausch & Lomb, Inc.	13,649		879,815
Baxter International, Inc.	157,358		5,435,145
Becton, Dickinson & Co.	64,655		3,672,404
Biomet, Inc.	64,618		2,803,775
Boston Scientific Corp. (a)	215,565		7,663,336
C.R. Bard, Inc.	26,713		1,709,098
Fisher Scientific International, Inc. (a)	29,939		1,867,595
Guidant Corp.	81,319		5,863,100
Hospira, Inc. (a)	39,846		1,334,841
Medtronic, Inc.	308,545		15,325,430
Millipore Corp. (a)	12,694		632,288
PerkinElmer, Inc.	32,699		735,401
St. Jude Medical, Inc. (a)	91,267		3,826,825
Stryker Corp.	102,622		4,951,512
Thermo Electron Corp. (a)	40,830		1,232,658
Waters Corp. (a)	30,846		1,443,284
Zimmer Holdings, Inc. (a)	62,618		5,016,954
			64,393,461
Health Care Providers & Services - 2.3%
Aetna, Inc.	37,690		4,701,828
AmerisourceBergen Corp.	26,833		1,574,560
Cardinal Health, Inc.	110,294		6,413,596
Caremark Rx, Inc. (a)	116,036		4,575,299
CIGNA Corp.	34,270		2,795,404
Express Scripts, Inc. (a)	19,396		1,482,630
HCA, Inc.	107,522		4,296,579
Health Management Associates, Inc. Class A	62,133		1,411,662
Humana, Inc. (a)	40,691		1,208,116
IMS Health, Inc.	59,209		1,374,241
Laboratory Corp. of America Holdings (a)	35,312		1,759,244
Manor Care, Inc.	22,065		781,763
McKesson Corp.	75,026		2,360,318
Medco Health Solutions, Inc. (a)	69,559		2,893,654
Quest Diagnostics, Inc.	25,833		2,468,343
Tenet Healthcare Corp. (a)	119,124		1,307,982
UnitedHealth Group, Inc.	166,849		14,687,717
WellPoint, Inc. (a)	75,344		8,664,560
			64,757,496

	Shares		Value (Note 1)
Pharmaceuticals - 6.8%
Abbott Laboratories	397,548		$ 18,545,614
Allergan, Inc.	33,513		2,716,899
Bristol-Myers Squibb Co.	496,646		12,724,071
Eli Lilly & Co.	288,868		16,393,259
Forest Laboratories, Inc. (a)	94,041		4,218,679
Johnson & Johnson	757,557		48,044,265
King Pharmaceuticals, Inc. (a)	61,662		764,609
Merck & Co., Inc.	566,072		18,193,554
Mylan Laboratories, Inc.	68,693		1,214,492
Pfizer, Inc.	1,922,400		51,693,336
Schering-Plough Corp.	375,945		7,849,732
Watson Pharmaceuticals, Inc. (a)	27,952		917,105
Wyeth	340,574		14,505,047
			197,780,662
TOTAL HEALTH CARE			365,299,926
INDUSTRIALS - 11.7%
Aerospace & Defense - 2.0%
General Dynamics Corp.	51,127		5,347,884
Goodrich Corp.	30,359		990,918
Honeywell International, Inc.	219,571		7,775,009
L-3 Communications Holdings, Inc.	29,396		2,152,963
Lockheed Martin Corp.	113,000		6,277,150
Northrop Grumman Corp.	93,994		5,109,514
Raytheon Co.	115,395		4,480,788
Rockwell Collins, Inc.	45,064		1,777,324
The Boeing Co.	214,320		11,095,346
United Technologies Corp.	130,451		13,482,111
			58,489,007
Air Freight & Logistics - 1.1%
FedEx Corp.	76,725		7,556,645
Ryder System, Inc.	16,412		784,001
United Parcel Service, Inc. Class B	286,099		24,450,021
			32,790,667
Airlines - 0.1%
Delta Air Lines, Inc. (a)(d)	33,034		247,094
Southwest Airlines Co.	199,000		3,239,720
			3,486,814
Building Products - 0.2%
American Standard Companies, Inc. (a)	54,759		2,262,642
Masco Corp.	114,359		4,177,534
			6,440,176
Commercial Services & Supplies - 1.0%
Allied Waste Industries, Inc. (a)	81,238		753,889
Apollo Group, Inc. Class A (a)	47,285		3,816,372
Avery Dennison Corp.	28,196		1,690,914
Cendant Corp.	268,753		6,283,445
Cintas Corp.	43,816		1,921,770
Equifax, Inc.	34,483		968,972
H&R Block, Inc.	42,047		2,060,303
Common Stocks - continued
	Shares		Value (Note 1)
INDUSTRIALS - continued
Commercial Services & Supplies - continued
Monster Worldwide, Inc. (a)	30,398		$ 1,022,589
Pitney Bowes, Inc.	58,869		2,724,457
R.R. Donnelley & Sons Co.	56,056		1,978,216
Robert Half International, Inc.	44,258		1,302,513
Waste Management, Inc.	146,045		4,372,587
			28,896,027
Construction & Engineering - 0.1%
Fluor Corp.	21,390		1,165,969
Electrical Equipment - 0.4%
American Power Conversion Corp.	48,824		1,044,834
Cooper Industries Ltd. Class A	23,427		1,590,459
Emerson Electric Co.	107,142		7,510,654
Power-One, Inc. (a)	21,427		191,129
Rockwell Automation, Inc.	47,018		2,329,742
			12,666,818
Industrial Conglomerates - 4.7%
3M Co.	198,733		16,310,017
General Electric Co.	2,698,696		98,502,391
Textron, Inc.	35,104		2,590,675
Tyco International Ltd.	513,492		18,352,204
			135,755,287
Machinery - 1.5%
Caterpillar, Inc.	87,106		8,493,706
Cummins, Inc.	11,619		973,556
Danaher Corp.	78,779		4,522,702
Deere & Co.	63,345		4,712,868
Dover Corp.	51,911		2,177,147
Eaton Corp.	38,775		2,805,759
Illinois Tool Works, Inc.	75,479		6,995,394
Ingersoll-Rand Co. Ltd. Class A	43,960		3,529,988
ITT Industries, Inc.	23,566		1,990,149
Navistar International Corp. (a)	17,824		783,900
PACCAR, Inc.	44,345		3,568,886
Pall Corp.	31,653		916,354
Parker Hannifin Corp.	30,498		2,309,919
			43,780,328
Road & Rail - 0.5%
Burlington Northern Santa Fe Corp.	95,960		4,539,868
CSX Corp.	54,838		2,197,907
Norfolk Southern Corp.	101,087		3,658,339
Union Pacific Corp.	66,263		4,456,187
			14,852,301
Trading Companies & Distributors - 0.1%
W.W. Grainger, Inc.	22,995		1,531,927
TOTAL INDUSTRIALS			339,855,321

	Shares		Value (Note 1)
INFORMATION TECHNOLOGY - 15.9%
Communications Equipment - 2.7%
ADC Telecommunications, Inc. (a)	206,477		$ 553,358
Andrew Corp. (a)	41,046		559,457
Avaya, Inc. (a)	116,860		2,009,992
CIENA Corp. (a)	145,951		487,476
Cisco Systems, Inc. (a)	1,680,854		32,440,482
Comverse Technology, Inc. (a)	50,454		1,233,600
Corning, Inc. (a)	357,943		4,212,989
JDS Uniphase Corp. (a)	368,605		1,168,478
Lucent Technologies, Inc. (a)	1,128,434		4,242,912
Lucent Technologies, Inc. warrants 12/10/07 (a)	30,408		48,045
Motorola, Inc.	621,428		10,688,562
QUALCOMM, Inc.	418,400		17,740,160
Scientific-Atlanta, Inc.	39,136		1,291,879
Tellabs, Inc. (a)	117,930		1,013,019
			77,690,409
Computers & Peripherals - 3.9%
Apple Computer, Inc. (a)	102,631		6,609,436
Dell, Inc. (a)	634,156		26,723,334
EMC Corp. (a)	611,686		9,095,771
Gateway, Inc. (a)	95,401		573,360
Hewlett-Packard Co.	770,875		16,165,249
International Business Machines Corp.	424,939		41,890,487
Lexmark International, Inc. Class A (a)	32,952		2,800,920
NCR Corp. (a)	23,791		1,647,051
Network Appliance, Inc. (a)(d)	91,585		3,042,454
QLogic Corp. (a)	23,620		867,563
Sun Microsystems, Inc. (a)	858,476		4,618,601
			114,034,226
Electronic Equipment & Instruments - 0.3%
Agilent Technologies, Inc. (a)	123,958		2,987,388
Jabil Circuit, Inc. (a)	51,436		1,315,733
Molex, Inc.	48,096		1,442,880
Sanmina-SCI Corp. (a)	133,031		1,126,773
Solectron Corp. (a)	247,828		1,320,923
Symbol Technologies, Inc.	61,427		1,062,687
Tektronix, Inc.	22,975		694,075
			9,950,459
Internet Software & Services - 0.5%
Yahoo!, Inc. (a)	350,943		13,223,532
IT Services - 1.1%
Affiliated Computer Services, Inc. Class A (a)	32,812		1,974,954
Automatic Data Processing, Inc.	148,702		6,594,934
Computer Sciences Corp. (a)	48,314		2,723,460
Convergys Corp. (a)	36,146		541,829
Electronic Data Systems Corp.	131,168		3,029,981
First Data Corp.	211,831		9,011,291
Fiserv, Inc. (a)	49,927		2,006,566
Paychex, Inc.	96,540		3,290,083
Common Stocks - continued
	Shares		Value (Note 1)
INFORMATION TECHNOLOGY - continued
IT Services - continued
Sabre Holdings Corp. Class A	34,583		$ 766,359
SunGard Data Systems, Inc. (a)	73,739		2,089,026
Unisys Corp. (a)	85,751		872,945
			32,901,428
Office Electronics - 0.1%
Xerox Corp. (a)	243,418		4,140,540
Semiconductors & Semiconductor Equipment - 3.0%
Advanced Micro Devices, Inc. (a)	98,509		2,169,168
Altera Corp. (a)	95,033		1,967,183
Analog Devices, Inc.	95,939		3,542,068
Applied Materials, Inc. (a)	433,500		7,412,850
Applied Micro Circuits Corp. (a)	78,658		331,150
Broadcom Corp. Class A (a)	84,003		2,711,617
Freescale Semiconductor, Inc. Class B	99,508		1,826,967
Intel Corp.	1,614,041		37,752,419
KLA-Tencor Corp. (a)	49,892		2,323,969
Linear Technology Corp.	78,377		3,037,893
LSI Logic Corp. (a)	98,259		538,459
Maxim Integrated Products, Inc.	83,024		3,519,387
Micron Technology, Inc. (a)	156,328		1,930,651
National Semiconductor Corp.	91,420		1,640,989
Novellus Systems, Inc. (a)	35,684		995,227
NVIDIA Corp. (a)	42,428		999,604
PMC-Sierra, Inc. (a)	45,493		511,796
Teradyne, Inc. (a)	49,568		846,126
Texas Instruments, Inc.	441,079		10,859,365
Xilinx, Inc.	88,912		2,636,241
			87,553,129
Software - 4.3%
Adobe Systems, Inc.	60,913		3,821,682
Autodesk, Inc.	58,584		2,223,263
BMC Software, Inc. (a)	56,657		1,053,820
Citrix Systems, Inc. (a)	43,240		1,060,677
Computer Associates International, Inc.	150,961		4,688,849
Compuware Corp. (a)	98,827		639,411
Electronic Arts, Inc. (a)	77,941		4,807,401
Intuit, Inc. (a)	47,845		2,105,658
Mercury Interactive Corp. (a)(d)	21,550		981,603
Microsoft Corp.	2,775,137		74,123,909
Novell, Inc. (a)	95,949		647,656
Oracle Corp. (a)	1,309,118		17,961,099
Parametric Technology Corp. (a)	68,698		404,631
PeopleSoft, Inc. (a)	9,591		253,970
Siebel Systems, Inc. (a)	129,719		1,362,050
Symantec Corp. (a)	161,886		4,170,183
VERITAS Software Corp. (a)	107,755		3,076,405
			123,382,267
TOTAL INFORMATION TECHNOLOGY			462,875,990

	Shares		Value (Note 1)
MATERIALS - 3.1%
Chemicals - 1.7%
Air Products & Chemicals, Inc.	58,024		$ 3,363,651
Dow Chemical Co.	240,707		11,917,404
E.I. du Pont de Nemours & Co.	253,527		12,435,499
Eastman Chemical Co.	19,893		1,148,423
Ecolab, Inc.	65,784		2,310,992
Engelhard Corp.	31,219		957,487
Great Lakes Chemical Corp.	13,034		371,339
Hercules, Inc. (a)	28,581		424,428
International Flavors & Fragrances, Inc.	24,056		1,030,559
Monsanto Co.	67,491		3,749,125
PPG Industries, Inc.	43,878		2,990,724
Praxair, Inc.	82,891		3,659,638
Rohm & Haas Co.	57,394		2,538,537
Sigma Aldrich Corp.	17,624		1,065,547
			47,963,353
Construction Materials - 0.0%
Vulcan Materials Co.	26,141		1,427,560
Containers & Packaging - 0.2%
Ball Corp.	28,744		1,264,161
Bemis Co., Inc.	27,298		794,099
Pactiv Corp. (a)	37,889		958,213
Sealed Air Corp. (a)	21,331		1,136,302
Temple-Inland, Inc.	14,293		977,641
			5,130,416
Metals & Mining - 0.7%
Alcoa, Inc.	222,203		6,981,618
Allegheny Technologies, Inc.	24,378		528,271
Freeport-McMoRan Copper & Gold, Inc. Class B	45,572		1,742,218
Newmont Mining Corp.	113,314		5,032,275
Nucor Corp.	40,610		2,125,527
Phelps Dodge Corp.	24,369		2,410,581
United States Steel Corp.	29,025		1,487,531
			20,308,021
Paper & Forest Products - 0.5%
Georgia-Pacific Corp.	65,876		2,469,032
International Paper Co.	124,209		5,216,778
Louisiana-Pacific Corp.	28,093		751,207
MeadWestvaco Corp.	51,729		1,753,096
Weyerhaeuser Co.	61,230		4,115,881
			14,305,994
TOTAL MATERIALS			89,135,344
TELECOMMUNICATION SERVICES - 3.2%
Diversified Telecommunication Services - 2.9%
ALLTEL Corp.	77,539		4,556,192
AT&T Corp.	203,158		3,872,191
BellSouth Corp.	467,585		12,994,187
CenturyTel, Inc.	34,351		1,218,430
Common Stocks - continued
	Shares		Value (Note 1)
TELECOMMUNICATION SERVICES - continued
Diversified Telecommunication Services - continued
Citizens Communications Co.	85,629		$ 1,180,824
Qwest Communications International, Inc. (a)	463,538		2,058,109
SBC Communications, Inc.	846,309		21,809,383
Sprint Corp.	375,487		9,330,852
Verizon Communications, Inc.	706,818		28,633,197
			85,653,365
Wireless Telecommunication Services - 0.3%
Nextel Communications, Inc. Class A (a)	283,673		8,510,190
TOTAL TELECOMMUNICATION SERVICES			94,163,555
UTILITIES - 2.9%
Electric Utilities - 2.0%
Allegheny Energy, Inc. (a)	35,037		690,579
Ameren Corp.	49,725		2,493,212
American Electric Power Co., Inc.	101,010		3,468,683
CenterPoint Energy, Inc.	78,576		887,909
Cinergy Corp.	46,266		1,926,054
Consolidated Edison, Inc.	61,778		2,702,788
DTE Energy Co.	44,405		1,915,188
Edison International	83,168		2,663,871
Entergy Corp.	57,063		3,856,888
Exelon Corp.	169,126		7,453,383
FirstEnergy Corp.	84,196		3,326,584
FPL Group, Inc.	47,374		3,541,207
PG&E Corp. (a)	102,904		3,424,645
Pinnacle West Capital Corp.	23,378		1,038,217
PPL Corp.	48,256		2,571,080
Progress Energy, Inc.	63,063		2,852,970
Southern Co.	188,816		6,329,112
TECO Energy, Inc.	50,969		781,864
TXU Corp.	61,320		3,958,819
Xcel Energy, Inc.	102,193		1,859,913
			57,742,966
Gas Utilities - 0.1%
KeySpan Corp.	40,995		1,617,253
Nicor, Inc.	11,253		415,686
NiSource, Inc.	69,021		1,572,298
Peoples Energy Corp.	9,606		422,184
			4,027,421
Multi-Utilities & Unregulated Power - 0.8%
AES Corp. (a)	165,616		2,263,971
Calpine Corp. (a)(d)	136,390		537,377
CMS Energy Corp. (a)	49,707		519,438
Constellation Energy Group, Inc.	44,889		1,962,098
Dominion Resources, Inc.	84,605		5,731,143
Duke Energy Corp.	244,199		6,185,561
Dynegy, Inc. Class A (a)	97,008		448,177

	Shares		Value (Note 1)
Public Service Enterprise Group, Inc.	60,680		$ 3,141,404
Sempra Energy	59,576		2,185,248
			22,974,417
TOTAL UTILITIES			84,744,804
TOTAL COMMON STOCKS (Cost $1,831,633,477)		2,881,926,750
U.S. Treasury Obligations - 0.2%
	Principal Amount
U.S. Treasury Bills, yield at date of purchase 1.61% 1/6/05 (e) (Cost $4,998,667)	$ 5,000,000		4,999,410
Money Market Funds - 0.8%
	Shares
Fidelity Cash Central Fund, 2.24% (b)	19,121,626		19,121,626
Fidelity Securities Lending Cash Central Fund, 2.23% (b)(c)	4,673,722		4,673,722
TOTAL MONEY MARKET FUNDS (Cost $23,795,348)		23,795,348
TOTAL INVESTMENT PORTFOLIO - 100.1% (Cost $1,860,427,492)			2,910,721,508
NET OTHER ASSETS - (0.1)%			(3,228,491)
NET ASSETS - 100%		$ 2,907,493,017

Futures Contracts
	Expiration Date	Underlying Face Amount at Value	Unrealized Appreciation/ (Depreciation)
Purchased
Equity Index Contracts
10 S&P 500 E-Mini Index Contracts	March 2005	$ 606,850	$ 4,093
88 S&P 500 Index Contracts	March 2005	26,701,400	199,998
TOTAL EQUITY INDEX CONTRACTS		$ 27,308,250	$ 204,091

The face value of futures purchased as a percentage of net assets - 0.9%

Legend

(a) Non-income producing

(d) Security or a portion of the security is on loan at period end.

(e) Security or a portion of the security was pledged to cover margin requirements for futures contracts. At the period end, the value of securities pledged amounted to $2,499,705.

Income Tax Information

At December 31, 2004, the fund had a capital loss carryforward of approximately $193,156,000 of which $36,405,000, $122,807,000 and $33,944,000 will expire on December 31, 2009, 2010 and 2011, respectively.

See accompanying notes which are an integral part of the financial statements.

Index 500 Portfolio

Fidelity Variable Insurance Products: Index 500 Portfolio

Financial Statements

Statement of Assets and Liabilities

December 31, 2004

Assets
Investment in securities, at value (including securities loaned of $4,418,815) (cost $1,860,427,492) - See accompanying schedule		$ 2,910,721,508
Receivable for fund shares sold		718,143
Dividends receivable		3,740,548
Interest receivable		41,474
Prepaid expenses		10,601
Receivable from investment adviser for expense reductions		401,025
Other affiliated receivables		5,795
Other receivables		29,548
Total assets		2,915,668,642
Liabilities
Payable for fund shares redeemed	$ 2,218,225
Accrued management fee	576,186
Distribution fees payable	23,359
Payable for daily variation on futures contracts	22,003
Other affiliated payables	247,159
Other payables and accrued expenses	414,971
Collateral on securities loaned, at value	4,673,722
Total liabilities		8,175,625
Net Assets		$ 2,907,493,017
Net Assets consist of:
Paid in capital		$ 2,002,716,840
Undistributed net investment income		49,696,311
Accumulated undistributed net realized gain (loss) on investments		(195,418,241)
Net unrealized appreciation (depreciation) on investments		1,050,498,107
Net Assets		$ 2,907,493,017
Initial Class: Net Asset Value, offering price and redemption price per share ($2,778,225,930 ÷ 20,167,721 shares)		$ 137.76
Service Class: Net Asset Value, offering price and redemption price per share ($23,216,426 ÷ 168,958 shares)		$ 137.41
Service Class 2: Net Asset Value, offering price and redemption price per share ($106,050,661 ÷ 775,738 shares)		$ 136.71

Statement of Operations

Year ended December 31, 2004

Investment Income
Dividends		$ 49,589,039
Special Dividends		8,350,620
Interest		315,841
Security lending		69,017
Total income		58,324,517

Expenses
Management fee	$ 7,048,607
Transfer agent fees	1,945,610
Distribution fees	220,995
Accounting and security lending fees	746,848
Non-interested trustees' compensation	16,202
Appreciation in deferred trustee compensation account	1,570
Custodian fees and expenses	64,646
Audit	50,473
Legal	7,052
Interest	1,623
Miscellaneous	482,393
Total expenses before reductions	10,586,019
Expense reductions	(2,138,524)	8,447,495
Net investment income (loss)		49,877,022
Realized and Unrealized Gain (Loss) Net realized gain (loss) on:
Investment securities	45,870,145
Futures contracts	3,256,099
Total net realized gain (loss)		49,126,244
Change in net unrealized appreciation (depreciation) on: Investment securities	190,580,653
Futures contracts	(511,248)
Total change in net unrealized appreciation (depreciation)		190,069,405
Net gain (loss)		239,195,649
Net increase (decrease) in net assets resulting from operations		$ 289,072,671

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products: Index 500 Portfolio
Financial Statements - continued

Statement of Changes in Net Assets

	Year ended December 31, 2004	Year ended December 31, 2003
Increase (Decrease) in Net Assets
Operations
Net investment income (loss)	$ 49,877,022	$ 40,789,727
Net realized gain (loss)	49,126,244	(34,078,673)
Change in net unrealized appreciation (depreciation)	190,069,405	686,179,235
Net increase (decrease) in net assets resulting from operations	289,072,671	692,890,289
Distributions to shareholders from net investment income	(40,638,037)	(39,819,617)
Share transactions - net increase (decrease)	(452,730,560)	(77,062,400)
Total increase (decrease) in net assets	(204,295,926)	576,008,272

Net Assets
Beginning of period	3,111,788,943	2,535,780,671
End of period (including undistributed net investment income of $49,696,311 and undistributed net investment income of $40,612,689, respectively)	$ 2,907,493,017	$ 3,111,788,943

Other Information:
Share Transactions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2
Shares Sold	1,899,337	63,065	511,841
Reinvested	308,386	1,581	6,195
Redeemed	(6,074,596)	(18,076)	(259,750)
Net increase (decrease)	(3,866,873)	46,570	258,286

Dollars Sold	$ 242,942,892	$ 7,949,025	$ 65,071,581
Reinvested	39,642,996	202,925	792,116
Redeemed	(774,302,513)	(2,314,988)	(32,714,594)
Net increase (decrease)	$ (491,716,625)	$ 5,836,962	$ 33,149,103

Share Transactions	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2
Shares Sold	3,347,458	58,155	492,355
Reinvested	423,444	1,303	4,503
Redeemed	(4,729,004)	(12,207)	(291,962)
Net increase (decrease)	(958,102)	47,251	204,896

Dollars Sold	$ 362,063,909	$ 6,250,927	$ 52,922,248
Reinvested	39,282,873	120,726	415,977
Redeemed	(506,013,307)	(1,274,037)	(30,831,716)
Net increase (decrease)	$ (104,666,525)	$ 5,097,616	$ 22,506,509

Distributions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2
From net investment income	$ 39,642,996	$ 202,925	$ 792,116

	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2
From net investment income	$ 39,282,914	$ 120,726	$ 415,977

See accompanying notes which are an integral part of the financial statements.

Index 500 Portfolio

Financial Highlights - Initial Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 126.13	$ 99.92	$ 130.08	$ 149.53	$ 167.41
Income from Investment Operations
Net investment income (loss)^C	2.18^D	1.63	1.51	1.48	1.51
Net realized and unrealized gain (loss)	11.10	26.18	(30.18)	(19.34)	(16.99)
Total from investment operations	13.28	27.81	(28.67)	(17.86)	(15.48)
Distributions from net investment income	(1.65)	(1.60)	(1.49)	(1.59)	(1.67)
Distributions from net realized gain	-	-	-	-	(.73)
Total distributions	(1.65)	(1.60)	(1.49)	(1.59)	(2.40)
Net asset value, end of period	$ 137.76	$ 126.13	$ 99.92	$ 130.08	$ 149.53
Total Return^{A, B}	10.62%	28.41%	(22.25)%	(12.09)%	(9.30)%
Ratios to Average Net Assets^E
Expenses before expense reductions	.35%	.34%	.33%	.35%	.33%
Expenses net of voluntary waivers, if any	.28%	.28%	.28%	.28%	.28%
Expenses net of all reductions	.28%	.28%	.28%	.28%	.28%
Net investment income (loss)	1.71%	1.50%	1.34%	1.09%	.94%
Supplemental Data
Net assets, end of period (000 omitted)	$ 2,778,226	$ 3,031,540	$ 2,497,252	$ 3,475,357	$ 4,148,728
Portfolio turnover rate	5%	6%	7%	9%	10%
^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown. ^B Total returns would have been lower had certain expenses not been reduced during the periods shown. ^C Calculated based on average shares outstanding during the period. ^D Investment income per share reflects a special dividend which amounted to $.36 per share. ^E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of any voluntary waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.

Financial Highlights - Service Class

Years ended December 31,	2004	2003	2002	2001	2000^G
Selected Per-Share Data
Net asset value, beginning of period	$ 125.86	$ 99.74	$ 129.94	$ 149.46	$ 166.69
Income from Investment Operations
Net investment income (loss)^E	2.05^F	1.54	1.34	1.24	.65
Net realized and unrealized gain (loss)	11.07	26.11	(30.07)	(19.23)	(17.88)
Total from investment operations	13.12	27.65	(28.73)	(17.99)	(17.23)
Distributions from net investment income	(1.57)	(1.53)	(1.47)	(1.53)	-
Net asset value, end of period	$ 137.41	$ 125.86	$ 99.74	$ 129.94	$ 149.46
Total Return^{B, C, D}	10.51%	28.27%	(22.32)%	(12.18)%	(10.34)%
Ratios to Average Net Assets^H
Expenses before expense reductions	.47%	.46%	.47%	.56%	.43%^A
Expenses net of voluntary waivers, if any	.38%	.38%	.38%	.38%	.38%^A
Expenses net of all reductions	.38%	.38%	.38%	.38%	.38%^A
Net investment income (loss)	1.61%	1.40%	1.24%	.99%	.84%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 23,216	$ 15,404	$ 7,494	$ 3,278	$ 90
Portfolio turnover rate	5%	6%	7%	9%	10%
^A Annualized ^B Total returns for periods of less than one year are not annualized. ^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown. ^D Total returns would have been lower had certain expenses not been reduced during the periods shown. ^E Calculated based on average shares outstanding during the period. ^F Investment income per share reflects a special dividend which amounted to $.36 per share. ^G For the period July 7, 2000 (commencement of operations) to December 31, 2000. ^H Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of any voluntary waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products: Index 500 Portfolio
Financial Statements - continued

Financial Highlights - Service Class 2

Years ended December 31,	2004	2003	2002	2001	2000^G
Selected Per-Share Data
Net asset value, beginning of period	$ 125.31	$ 99.29	$ 129.43	$ 149.18	$ 163.25
Income from Investment Operations
Net investment income (loss)^E	1.85^F	1.37	1.19	1.09	1.04
Net realized and unrealized gain (loss)	11.01	26.03	(30.00)	(19.23)	(12.71)
Total from investment operations	12.86	27.40	(28.81)	(18.14)	(11.67)
Distributions from net investment income	(1.46)	(1.38)	(1.33)	(1.61)	(1.67)
Distributions from net realized gain	-	-	-	-	(.73)
Total distributions	(1.46)	(1.38)	(1.33)	(1.61)	(2.40)
Net asset value, end of period	$ 136.71	$ 125.31	$ 99.29	$ 129.43	$ 149.18
Total Return^{B, C, D}	10.34%	28.09%	(22.45)%	(12.31)%	(7.21)%
Ratios to Average Net Assets^H
Expenses before expense reductions	.61%	.60%	.60%	.61%	.76%^A
Expenses net of voluntary waivers, if any	.53%	.53%	.53%	.53%	.53%^A
Expenses net of all reductions	.53%	.53%	.53%	.53%	.53%^A
Net investment income (loss)	1.46%	1.25%	1.09%	.84%	.69%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 106,051	$ 64,844	$ 31,035	$ 19,338	$ 323
Portfolio turnover rate	5%	6%	7%	9%	10%
^A Annualized ^B Total returns for periods of less than one year are not annualized. ^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown. ^D Total returns would have been lower had certain expenses not been reduced during the periods shown. ^E Calculated based on average shares outstanding during the period. ^F Investment income per share reflects a special dividend which amounted to $.36 per share. ^G For the period January 12, 2000 (commencement of operations) to December 31, 2000. ^H Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of any voluntary waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.

See accompanying notes which are an integral part of the financial statements.

Index 500 Portfolio

Fidelity Variable Insurance Products: Overseas Portfolio

Performance: The Bottom Line

Average annual total return reflects the change in the value of an investment, assuming reinvestment of a class' dividend income and capital gains (the profits earned upon the sale of securities that have grown in value) and assuming a constant rate of performance each year. During periods of reimbursement by Fidelity, a fund's total return will be greater than it would be had the reimbursement not occurred. Performance numbers are net of all underlying fund operating expenses, but do not include any insurance charges imposed by your insurance company's separate account. If performance information included the effect of these additional charges, the total returns would be lower. How a fund did yesterday is no guarantee of how it will do tomorrow.

Average Annual Total Returns

Periods ended December 31, 2004	Past 1 year	Past 5 years	Past 10 years
Fidelity® VIP: Overseas - Initial Class	13.57%	-3.71%	6.31%
Fidelity VIP: Overseas - Service Class ^A	13.49%	-3.80%	6.24%
Fidelity VIP: Overseas - Service Class 2 ^B	13.31%	-3.89%	6.19%

^A The initial offering of Service Class shares took place on November 3, 1997. Performance for Service Class shares reflects an asset-based distribution fee (12b-1 fee), and returns prior to November 3, 1997 are those of Initial Class and do not include the effects of Service Class' 12b-1 fee. Had Service Class shares' 12b-1 fee been reflected, returns prior to November 3, 1997 would have been lower.

$10,000 Over 10 Years

Let's say hypothetically that $10,000 was invested in Fidelity® Variable Insurance Products: Overseas Portfolio - Initial Class on December 31, 1994. The chart shows how the value of your investment would have changed, and also shows how the MSCI® EAFE Index performed over the same period.

Annual Report

Fidelity Variable Insurance Products: Overseas Portfolio

Management's Discussion of Fund Performance

Comments from Rick Mace, Portfolio Manager of Fidelity® Variable Insurance Products: Overseas Portfolio

Most of the world's major stock markets posted solid gains for the year ending December 31, 2004. The Morgan Stanley Capital International^SM Europe, Australasia, Far East (MSCI® EAFE®) Index - designed to represent the performance of developed stock markets outside the United States and Canada - gained 20.42%, compared to 10.88% for the Standard & Poor's 500^SM Index. A weak U.S. dollar relative to most foreign currencies was partly responsible for the performance disparity. On a regional basis, Europe was one of the top performers. Many investors felt European stocks offered better valuations and brighter earnings prospects than U.S. equities. Latin American countries, many of which are exporters of oil and raw materials that received strong support from high commodity prices, also did well. Conversely, Japan underperformed, as early optimism was eroded by disappointing economic indicators and concerns about the impact of China's economic slowdown on exports. Meanwhile, some Asian emerging markets, such as Taiwan and Indonesia, suffered from a deceleration in corporate capital spending.

For the one-year period ending December 31, 2004, the return of Overseas Portfolio trailed the advances of both the MSCI EAFE index and the
Lipper^SM Variable Annuity International Funds Average, the latter of which rose 18.20%. The fund's overweighting in two poor-performing market groups - semiconductors and diversified financials - caused the bulk of its performance shortfall relative to the index. Notable detractors included semiconductor equipment manufacturers Tokyo Electron, Netherlands-based ASML Holding and Taiwanese chip maker United Microelectronics, as well as Japanese brokerage stocks Nikko Cordial and Nomura Holdings. The semiconductor industry was the worst-performing component of the index during the past 12 months. On the positive side of the ledger, overweighting strong-performing energy stocks relative to the index was helpful. France-based energy producer Total SA and Canada's Talisman Energy were noteworthy standouts for the fund. Elsewhere, overweighting a couple of strong-performing stocks in the telecommunication services sector helped offset some of the fund's weakness in other areas. Specifically, holdings in U.K.-based mobile communications provider mmO2 and Germany-based Deutsche Telekom performed quite well.

Annual Report

Fidelity Variable Insurance Products: Overseas Portfolio

Investment Summary

Top Five Stocks as of December 31, 2004
	% of fund's net assets
Vodafone Group PLC (United Kingdom)	4.4
Allianz AG (Reg.) (Germany)	3.4
ASML Holding NV (Netherlands)	3.2
Total SA Series B (France)	2.7
UBS AG (Reg.) (Switzerland)	2.5
	16.2
Top Five Market Sectors as of December 31, 2004
	% of fund's net assets
Financials	29.6
Information Technology	18.9
Telecommunication Services	9.5
Consumer Discretionary	8.8
Health Care	7.9
Top Five Countries as of December 31, 2004
(excluding cash equivalents)	% of fund's net assets
Japan	18.3
United Kingdom	14.6
France	10.2
Germany	10.0
Switzerland	9.2

Annual Report

Fidelity Variable Insurance Products: Overseas Portfolio

Investments December 31, 2004

Showing Percentage of Net Assets

Common Stocks - 95.5%
	Shares		Value (Note 1)
Australia - 0.7%
CSL Ltd.	698,840		$ 15,993,093
Belgium - 0.4%
Fortis	316,000		8,723,430
Brazil - 3.0%
Aracruz Celulose SA sponsored ADR	291,400		10,985,780
Banco Bradesco SA sponsored ADR (non-vtg.)	489,000		12,254,340
Banco Itau Holding Financeira SA sponsored ADR (non-vtg.)	133,900		10,065,263
Tele Norte Leste Participacoes SA ADR (non-vtg.)	473,600		7,989,632
Uniao de Bancos Brasileiros SA (Unibanco) GDR	355,000		11,260,600
Usinas Siderurgicas de Minas Gerais SA (Usiminas) (PN-A)	391,900		7,944,238
Votorantim Celulose e Papel SA sponsored ADR (non-vtg.)	637,250		10,323,450
TOTAL BRAZIL			70,823,303
Canada - 2.7%
Alcan, Inc.	165,700		8,119,300
EnCana Corp.	289,500		16,501,500
Research In Motion Ltd. (a)	224,600		18,488,323
Talisman Energy, Inc.	691,300		18,636,296
Tembec, Inc. (a)	304,500		1,829,537
TOTAL CANADA			63,574,956
China - 0.6%
BYD Co. Ltd. (H Shares)	683,600		1,811,723
China Telecom Corp. Ltd. sponsored ADR	200,280		7,370,304
Global Bio-Chem Technology Group Co. Ltd.	6,618,000		4,342,296
Global Bio-Chem Technology Group Co. Ltd. warrants 5/31/07 (a)	516,250		24,574
People's Food Holdings Ltd.	1,700,000		1,562,404
TOTAL CHINA			15,111,301
Denmark - 0.7%
Coloplast AS Series B (d)	54,400		2,981,651
Danske Bank AS	163,300		4,996,457
Novo Nordisk AS Series B	162,100		8,840,313
TOTAL DENMARK			16,818,421
Finland - 1.9%
Nokia Corp.	2,829,150		44,332,780
France - 10.2%
Accor SA	203,282		8,882,300
Alcatel SA sponsored ADR (a)	1,655,300		25,872,339
AXA SA	710,604		17,587,449
BNP Paribas SA	376,602		27,229,874
Credit Agricole SA	113,400		3,415,087
Dassault Systemes SA	113,914		5,733,064
France Telecom SA	472,561		15,632,318
L'Oreal SA	81,395		6,166,755

	Shares		Value (Note 1)
Lagardere S.C.A. (Reg.)	41,700		$ 3,003,768
Pernod-Ricard	95,000		14,523,903
Sanofi-Aventis sponsored ADR	518,200		20,753,910
Thomson SA	240,300		6,340,291
Total SA Series B	287,300		63,114,064
Vivendi Universal SA sponsored ADR (a)	777,500		24,934,425
TOTAL FRANCE			243,189,547
Germany - 10.0%
Allianz AG (Reg.)	603,400		80,191,858
BASF AG	298,725		21,514,175
Bayerische Hypo-und Vereinsbank AG (a)	454,900		10,305,480
Deutsche Boerse AG	240,939		14,472,732
Deutsche Telekom AG sponsored ADR (a)	2,104,700		47,734,596
E.ON AG	72,544		6,601,504
Infineon Technologies AG sponsored ADR (a)	893,900		9,743,510
RWE AG	164,060		9,058,013
SAP AG sponsored ADR	304,400		13,457,524
Siemens AG sponsored ADR	289,400		24,503,498
TOTAL GERMANY			237,582,890
Hong Kong - 1.5%
Esprit Holdings Ltd.	850,500		5,142,741
Hong Kong Exchanges & Clearing Ltd.	1,952,000		5,223,549
Hutchison Whampoa Ltd.	950,600		8,897,199
Techtronic Industries Co. Ltd.	6,544,000		14,270,379
Television Broadcasts Ltd.	734,000		3,408,990
TOTAL HONG KONG			36,942,858
India - 2.9%
Cipla Ltd.	1,160,697		8,528,775
Dr. Reddy's Laboratories Ltd.	151,900		3,039,229
HDFC Bank Ltd.	176,031		2,117,867
Housing Development Finance Corp. Ltd.	1,107,583		19,694,490
Infosys Technologies Ltd.	346,252		16,745,787
Reliance Industries Ltd.	367,900		4,539,843
Satyam Computer Services Ltd.	1,219,887		11,571,298
State Bank of India	179,400		2,933,242
TOTAL INDIA			69,170,531
Italy - 0.9%
ENI Spa	880,486		22,160,072
Japan - 18.3%
Advantest Corp.	221,800		19,033,701
Aeon Co. Ltd.	929,400		15,515,709
Canon, Inc.	221,500		12,018,590
Daiwa Securities Group, Inc.	2,814,000		20,329,591
FamilyMart Co. Ltd.	276,700		8,063,551
Honda Motor Co. Ltd.	260,800		13,592,896
Ito Yokado Ltd.	327,300		13,740,018
JAFCO Co. Ltd.	247,800		16,837,724
Mizuho Financial Group, Inc.	6,790		34,205,214
Common Stocks - continued
	Shares		Value (Note 1)
Japan - continued
Murata Manufacturing Co. Ltd.	229,700		$ 12,849,566
Nikko Cordial Corp.	5,323,000		28,218,189
Nitto Denko Corp.	263,200		14,440,926
Nomura Holdings, Inc.	2,127,000		30,969,121
ORIX Corp.	92,700		12,597,716
Ricoh Co. Ltd.	608,000		11,735,000
Rohm Co. Ltd.	108,600		11,238,505
Softbank Corp. (d)	362,100		17,640,135
Sumitomo Electric Industries Ltd.	852,000		9,274,432
Sumitomo Mitsui Financial Group, Inc. (d)	5,585		40,621,157
TDK Corp.	135,900		10,070,107
Tokyo Electron Ltd.	469,700		28,934,951
Toyota Motor Corp.	875,800		35,850,874
UFJ Holdings, Inc. (a)	1,980		12,004,101
Yahoo! Japan Corp. (a)	1,334		6,407,576
TOTAL JAPAN			436,189,350
Korea (South) - 3.5%
Honam Petrochemical Corp.	358,630		16,750,157
Hyundai Motor Co.	66,243		3,551,475
Kookmin Bank (a)	323,810		12,668,379
LG Electronics, Inc.	360,200		22,303,731
LG Petrochemical Co. Ltd.	178,050		4,471,890
Samsung Electro-Mechanics Co. Ltd. (a)	183,200		4,601,237
Samsung Electronics Co. Ltd.	21,660		9,426,035
Shinhan Financial Group Co. Ltd.	414,900		9,378,536
TOTAL KOREA (SOUTH)			83,151,440
Netherlands - 7.1%
Aegon NV	1,385,500		18,851,385
ASML Holding NV (a)(d)	4,718,139		75,065,591
EADS NV	355,600		10,318,305
ING Groep NV (Certificaten Van Aandelen)	926,624		28,030,376
Unilever NV (NY Shares)	154,100		10,280,011
VNU NV	547,525		16,139,850
Wolters Kluwer NV (Certificaten Van Aandelen)	514,275		10,304,139
TOTAL NETHERLANDS			168,989,657
Spain - 2.4%
Banco Bilbao Vizcaya Argentaria SA	840,600		14,912,242
Banco Santander Central Hispano SA	1,208,868		14,953,697
Telefonica SA	1,446,462		27,241,701
TOTAL SPAIN			57,107,640
Sweden - 0.7%
Telefonaktiebolaget LM Ericsson ADR (a)	521,800		16,431,482
Switzerland - 9.2%
ABB Ltd. (Reg.) (a)	1,551,851		8,648,255
Actelion Ltd. (Reg.) (a)	22,893		2,346,661
Compagnie Financiere Richemont unit	312,115		10,367,768

	Shares		Value (Note 1)
Credit Suisse Group (Reg.)	1,331,669		$ 56,183,115
Nestle SA (Reg.)	32,100		8,381,017
Novartis AG (Reg.)	792,392		40,047,492
Phonak Holding AG	170,412		5,608,364
Roche Holding AG (participation certificate)	227,849		26,035,315
Societe Generale de Surveillance Holding SA (SGS) (Reg.)	4,450		3,110,645
UBS AG (Reg.)	696,987		58,435,390
TOTAL SWITZERLAND			219,164,022
Taiwan - 2.8%
Acer, Inc.	2,269,000		3,747,169
Hon Hai Precision Industries Co. Ltd.	2,110,109		9,757,346
Quanta Computer, Inc.	2,972,260		5,329,312
Taiwan Semiconductor Manufacturing Co. Ltd.	5,715,000		9,078,562
Taiwan Semiconductor Manufacturing Co. Ltd. sponsored ADR	727,900		6,179,871
United Microelectronics Corp.	39,939,360		25,755,171
United Microelectronics Corp. sponsored ADR	796,300		2,810,939
Yageo Corp. (a)	9,414,000		3,375,892
TOTAL TAIWAN			66,034,262
United Kingdom - 14.6%
3i Group PLC	663,873		8,484,877
AstraZeneca PLC (United Kingdom)	497,100		18,089,469
BHP Billiton PLC	1,008,495		11,815,326
BP PLC	4,252,306		41,389,112
British Sky Broadcasting Group PLC (BSkyB)	631,200		6,807,531
Carphone Warehouse Group PLC	1,559,814		5,141,098
Hilton Group PLC	996,000		5,437,858
HSBC Holdings PLC (United Kingdom) (Reg.)	2,564,190		43,663,027
ITV PLC	4,352,554		8,791,289
Kesa Electricals PLC	1,433,748		7,772,801
Man Group PLC	611,067		17,261,675
Prudential PLC	1,160		10,084
Reckitt Benckiser PLC	331,800		10,022,300
Rio Tinto PLC (Reg.)	782,606		23,323,615
Smith & Nephew PLC	1,796,100		18,593,227
Tesco PLC	1,548,141		9,559,064
Vodafone Group PLC	38,147,725		104,448,467
Xstrata PLC	367,500		6,572,938
TOTAL UNITED KINGDOM			347,183,758
United States of America - 1.4%
Freeport-McMoRan Copper & Gold, Inc. Class B	344,900		13,185,527
Common Stocks - continued
	Shares		Value (Note 1)
United States of America - continued
Synthes, Inc.	77,867		$ 8,713,013
Telewest Global, Inc. (a)	724,379		12,734,583
TOTAL UNITED STATES OF AMERICA			34,633,123
TOTAL COMMON STOCKS (Cost $1,721,420,863)		2,273,307,916
Money Market Funds - 5.6%

Fidelity Cash Central Fund, 2.24% (b)	82,926,736		82,926,736
Fidelity Securities Lending Cash Central Fund, 2.23% (b)(c)	49,646,431		49,646,431
TOTAL MONEY MARKET FUNDS (Cost $132,573,167)		132,573,167
TOTAL INVESTMENT PORTFOLIO - 101.1% (Cost $1,853,994,030)			2,405,881,083
NET OTHER ASSETS - (1.1)%			(25,904,251)
NET ASSETS - 100%		$ 2,379,976,832

Legend

(a) Non-income producing

(d) Security or a portion of the security is on loan at period end.

Income Tax Information

At December 31, 2004, the fund had a capital loss carryforward of approximately $472,630,000 of which $233,538,000, $191,786,000 and $47,306,000 will expire on December 31, 2009, 2010 and 2011, respectively.

Annual Report

See accompanying notes which are an integral part of the financial statements.

Fidelity Variable Insurance Products: Overseas Portfolio

Financial Statements

Statement of Assets and Liabilities

December 31, 2004
Assets
Investment in securities, at value (including securities loaned of $47,243,590) (cost $1,853,994,030) - See accompanying schedule		$ 2,405,881,083
Foreign currency held at value (cost $22,846,483)		23,660,247
Receivable for fund shares sold		5,794,295
Dividends receivable		4,143,285
Interest receivable		136,963
Prepaid expenses		7,963
Other affiliated receivables		10,094
Other receivables		274,898
Total assets		2,439,908,828
Liabilities
Payable for fund shares redeemed	$ 6,629,143
Accrued management fee	1,397,303
Distribution fees payable	102,217
Other affiliated payables	261,313
Other payables and accrued expenses	1,895,589
Collateral on securities loaned, at value	49,646,431
Total liabilities		59,931,996
Net Assets		$ 2,379,976,832
Net Assets consist of:
Paid in capital		$ 2,300,419,130
Undistributed net investment income		1,867,057
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions		(473,792,313)
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies		551,482,958
Net Assets		$ 2,379,976,832
Calculation of Maximum Offering Price
Initial Class: Net Asset Value, offering price and redemption price per share ($1,491,484,922 ÷ 85,154,763 shares)		$ 17.51
Service Class: Net Asset Value, offering price and redemption price per share ($322,649,186 ÷ 18,498,260 shares)		$ 17.44
Service Class 2: Net Asset Value, offering price and redemption price per share ($319,707,841 ÷ 18,384,916 shares)		$ 17.39
Initial Class R: Net Asset Value, offering price and redemption price per share ($132,063,904 ÷ 7,549,785 shares)		$ 17.49
Service Class R: Net Asset Value, offering price and redemption price per share ($86,509,078 ÷ 4,964,551 shares)		$ 17.43
Service Class 2R: Net Asset Value, offering price and redemption price per share ($27,561,901 ÷ 1,593,209 shares)		$ 17.30

Statement of Operations

Year ended December 31, 2004
Investment Income
Dividends		$ 35,350,755
Interest		2,188,079
Security lending		1,280,975
		38,819,809
Less foreign taxes withheld		(4,024,449)
Total income		34,795,360

Expenses
Management fee	$ 15,178,054
Transfer agent fees	1,432,011
Distribution fees	930,529
Accounting and security lending fees	992,201
Non-interested trustees' compensation	11,307
Appreciation in deferred trustee compensation account	4,711
Custodian fees and expenses	736,386
Registration fees	195
Audit	67,736
Legal	5,915
Miscellaneous	631,165
Total expenses before reductions	19,990,210
Expense reductions	(914,176)	19,076,034
Net investment income (loss)		15,719,326
Realized and Unrealized Gain (Loss) Net realized gain (loss) on:
Investment securities (net of foreign taxes of $215,095)	146,199,544
Foreign currency transactions	(190,461)
Total net realized gain (loss)		146,009,083
Change in net unrealized appreciation (depreciation) on: Investment securities (net of decrease in deferred foreign taxes of $2,494,712)	113,706,840
Assets and liabilities in foreign currencies	870,818
Total change in net unrealized appreciation (depreciation)		114,577,658
Net gain (loss)		260,586,741
Net increase (decrease) in net assets resulting from operations		$ 276,306,067

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products: Overseas Portfolio
Financial Statements - continued

Statement of Changes in Net Assets

	Year ended December 31, 2004	Year ended December 31, 2003
Increase (Decrease) in Net Assets
Operations
Net investment income (loss)	$ 15,719,326	$ 12,219,607
Net realized gain (loss)	146,009,083	(23,642,194)
Change in net unrealized appreciation (depreciation)	114,577,658	580,158,781
Net increase (decrease) in net assets resulting from operations	276,306,067	568,736,194
Distributions to shareholders from net investment income	(22,557,627)	(11,225,102)
Share transactions - net increase (decrease)	199,907,441	76,831,320
Redemption fees	51,279	30,862
Total increase (decrease) in net assets	453,707,160	634,373,274

Net Assets
Beginning of period	1,926,269,672	1,291,896,398
End of period (including undistributed net investment income of $1,867,057 and undistributed net investment income of $8,430,134, respectively)	$ 2,379,976,832	$ 1,926,269,672

Other Information:
Share Transactions	Year ended December 31, 2004
Shares	Initial Class	Service Class	Service Class 2	Initial Class R	Service Class R	Service Class 2R
Sold	14,747,796	5,622,052	11,770,833	5,679,220	1,860,289	1,379,237
Reinvested	1,047,651	175,526	101,002	30,931	41,469	4,934
Redeemed	(22,763,135)	(3,179,061)	(2,573,003)	(695,245)	(555,521)	(249,620)
Net increase (decrease)	(6,967,688)	2,618,517	9,298,832	5,014,906	1,346,237	1,134,551

Dollars Sold	$ 235,040,834	$ 88,487,632	$ 185,307,863	$ 89,613,678	$ 29,201,895	$ 21,125,719
Reinvested	16,877,656	2,818,947	1,619,063	497,678	665,579	78,704
Redeemed	(358,049,999)	(49,596,873)	(40,549,211)	(10,848,287)	(8,516,411)	(3,867,026)
Net increase (decrease)	$ (106,131,509)	$ 41,709,706	$ 146,377,715	$ 79,263,069	$ 21,351,063	$ 17,337,397

Share Transactions	Year ended December 31, 2003
Shares	Initial Class	Service Class	Service Class 2	Initial Class R	Service Class R	Service Class 2R
Sold	135,754,582	34,982,458	57,905,822	1,401,445	2,096,259	337,680
Reinvested	891,621	140,448	26,238	15,499	17,531	2,278
Redeemed	(138,456,054)	(35,447,830)	(53,234,293)	(307,443)	(140,438)	(29,586)
Net increase (decrease)	(1,809,851)	(324,924)	4,697,767	1,109,501	1,973,352	310,372

Dollars Sold	$ 1,613,667,675	$ 391,087,076	$ 672,794,854	$ 17,351,785	$ 25,897,371	$ 3,723,543
Reinvested	9,156,952	1,438,187	268,410	159,020	179,341	23,192
Redeemed	(1,637,501,847)	(397,130,238)	(618,521,317)	(3,679,685)	(1,677,969)	(405,030)
Net increase (decrease)	$ (14,677,220)	$ (4,604,975)	$ 54,541,947	$ 13,831,120	$ 24,398,743	$ 3,341,705

Distributions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2	Initial Class R	Service Class R	Service Class 2R
From net investment income	$ 16,877,656	$ 2,818,947	$ 1,619,063	$ 497,678	$ 665,579	$ 78,704

	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2	Initial Class R	Service Class R	Service Class 2R
From net investment income	$ 9,156,952	$ 1,438,187	$ 268,410	$ 159,020	$ 179,341	$ 23,192

See accompanying notes which are an integral part of the financial statements.

Overseas Portfolio

Financial Highlights - Initial Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 15.59	$ 10.98	$ 13.88	$ 20.00	$ 27.44
Income from Investment Operations
Net investment income (loss)^C	.13	.11	.10	.14	.19^D
Net realized and unrealized gain (loss)	1.97	4.60	(2.90)	(3.86)	(4.93)
Total from investment operations	2.10	4.71	(2.80)	(3.72)	(4.74)
Distributions from net investment income	(.18)	(.10)	(.10)	(.93)	(.31)
Distributions in excess of net investment income	-	-	-	-	(.06)
Distributions from net realized gain	-	-	-	(1.47)	(2.33)
Total distributions	(.18)	(.10)	(.10)	(2.40)	(2.70)
Redemption fees added to paid in capital^C	-^F	-^F	-^F	-	-
Net asset value, end of period	$ 17.51	$ 15.59	$ 10.98	$ 13.88	$ 20.00
Total Return^{A, B}	13.57%	43.37%	(20.28)%	(21.21)%	(19.07)%
Ratios to Average Net Assets^E
Expenses before expense reductions	.91%	.90%	.90%	.92%	.89%
Expenses net of voluntary waivers, if any	.91%	.90%	.90%	.92%	.89%
Expenses net of all reductions	.87%	.86%	.86%	.87%	.87%
Net investment income (loss)	.80%	.87%	.79%	.91%	.84%
Supplemental Data
Net assets, end of period (000 omitted)	$ 1,491,485	$ 1,436,137	$ 1,031,489	$ 1,496,873	$ 2,267,507
Portfolio turnover rate	84%	99%	77%	98%	136%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^D Investment income per share reflects a special dividend which amounted to $.04 per share.

^F Amount represents less than $.01 per share.

Financial Highlights - Service Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 15.53	$ 10.94	$ 13.83	$ 19.94	$ 27.39
Income from Investment Operations
Net investment income (loss)^C	.11	.09	.09	.12	.17^D
Net realized and unrealized gain (loss)	1.97	4.59	(2.89)	(3.84)	(4.93)
Total from investment operations	2.08	4.68	(2.80)	(3.72)	(4.76)
Distributions from net investment income	(.17)	(.09)	(.09)	(.92)	(.30)
Distributions in excess of net investment income	-	-	-	-	(.06)
Distributions from net realized gain	-	-	-	(1.47)	(2.33)
Total distributions	(.17)	(.09)	(.09)	(2.39)	(2.69)
Redemption fees added to paid in capital^C	-^F	-^F	-^F	-	-
Net asset value, end of period	$ 17.44	$ 15.53	$ 10.94	$ 13.83	$ 19.94
Total Return^{A, B}	13.49%	43.20%	(20.34)%	(21.27)%	(19.18)%
Ratios to Average Net Assets^E
Expenses before expense reductions	1.01%	1.00%	1.00%	1.03%	.99%
Expenses net of voluntary waivers, if any	1.01%	1.00%	1.00%	1.03%	.99%
Expenses net of all reductions	.97%	.96%	.96%	.97%	.97%
Net investment income (loss)	.69%	.77%	.69%	.81%	.74%
Supplemental Data
Net assets, end of period (000 omitted)	$ 322,649	$ 246,632	$ 177,322	$ 240,525	$ 257,257
Portfolio turnover rate	84%	99%	77%	98%	136%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^D Investment income per share reflects a special dividend which amounted to $.04 per share.

^F Amount represents less than $.01 per share.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Service Class 2

Years ended December 31,	2004	2003	2002	2001	2000^G
Selected Per-Share Data
Net asset value, beginning of period	$ 15.50	$ 10.90	$ 13.81	$ 19.91	$ 26.16
Income from Investment Operations
Net investment income (loss)^E	.08	.08	.07	.10	.12^F
Net realized and unrealized gain (loss)	1.97	4.58	(2.88)	(3.80)	(3.68)
Total from investment operations	2.05	4.66	(2.81)	(3.70)	(3.56)
Distributions from net investment income	(.16)	(.06)	(.10)	(.93)	(.30)
Distributions in excess of net investment income	-	-	-	-	(.06)
Distributions from net realized gain	-	-	-	(1.47)	(2.33)
Total distributions	(.16)	(.06)	(.10)	(2.40)	(2.69)
Redemption fees added to paid in capital^E	-^I	-^I	-^I	(1.47)	(2.33)
Net asset value, end of period	$ 17.39	$ 15.50	$ 10.90	$ 13.81	$ 19.91
Total Return^{B, C, D}	13.31%	43.04%	(20.46)%	(21.20)%	(15.50)%
Ratios to Average Net Assets^H
Expenses before expense reductions	1.16%	1.16%	1.16%	1.18%	1.15%^A
Expenses net of voluntary waivers, if any	1.16%	1.16%	1.16%	1.18%	1.15%^A
Expenses net of all reductions	1.12%	1.12%	1.12%	1.12%	1.13%^A
Net investment income (loss)	.54%	.61%	.53%	.65%	.58%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 319,708	$ 140,822	$ 47,824	$ 48,843	$ 12,351
Portfolio turnover rate	84%	99%	77%	98%	136%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F Investment income per share reflects a special dividend which amounted to $.04 per share.

^G For the period January 12, 2000 (commencement of sale of shares) to December 31, 2000.

^I Amount represents less than $.01 per share.

Financial Highlights - Initial Class R

Years ended December 31,	2004	2003	2002^F
Selected Per-Share Data
Net asset value, beginning of period	$ 15.57	$ 10.98	$ 14.05
Income from Investment Operations
Net investment income (loss)^E	.12	.11	.06
Net realized and unrealized gain (loss)	1.98	4.59	(3.13)
Total from investment operations	2.10	4.70	(3.07)
Distributions from net investment income	(.18)	(.11)	-
Redemption fees added to paid in capital^{E, H}	-	-	-
Net asset value, end of period	$ 17.49	$ 15.57	$ 10.98
Total Return^{B, C, D}	13.59%	43.32%	(21.85)%
Ratios to Average Net Assets^G
Expenses before expense reductions	.91%	.90%	.91%^A
Expenses net of voluntary waivers, if any	.91%	.90%	.91%^A
Expenses net of all reductions	.87%	.86%	.87%^A
Net investment income (loss)	.79%	.87%	.79%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 132,064	$ 39,466	$ 15,649
Portfolio turnover rate	84%	99%	77%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F For the period April 24, 2002 (commencement of sale of shares) to December 31, 2002.

^H Amount represents less than $.01 per share.

See accompanying notes which are an integral part of the financial statements.

Overseas Portfolio

Financial Highlights - Service Class R

Years ended December 31,	2004	2003	2002^F
Selected Per-Share Data
Net asset value, beginning of period	$ 15.52	$ 10.94	$ 14.01
Income from Investment Operations
Net investment income (loss)^E	.11	.10	.05
Net realized and unrealized gain (loss)	1.97	4.58	(3.12)
Total from investment operations	2.08	4.68	(3.07)
Distributions from net investment income	(.17)	(.10)	-
Redemption fees added to paid in capital^{E, H}	-	-	-
Net asset value, end of period	$ 17.43	$ 15.52	$ 10.94
Total Return^{B, C, D}	13.50%	43.25%	(21.91)%
Ratios to Average Net Assets^G
Expenses before expense reductions	1.01%	1.00%	1.01%^A
Expenses net of voluntary waivers, if any	1.01%	1.00%	1.01%^A
Expenses net of all reductions	.96%	.96%	.97%^A
Net investment income (loss)	.70%	.77%	.69%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 86,509	$ 56,141	$ 17,997
Portfolio turnover rate	84%	99%	77%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F For the period April 24, 2002 (commencement of sale of shares) to December 31, 2002.

^H Amount represents less than $.01 per share.

Financial Highlights - Service Class 2R

Years ended December 31,	2004	2003	2002^F
Selected Per-Share Data
Net asset value, beginning of period	$ 15.42	$ 10.90	$ 13.96
Income from Investment Operations
Net investment income (loss)^E	.08	.08	.04
Net realized and unrealized gain (loss)	1.96	4.55	(3.10)
Total from investment operations	2.04	4.63	(3.06)
Distributions from net investment income	(.16)	(.11)	-
Redemption fees added to paid in capital^{E, H}	-	-	-
Net asset value, end of period	$ 17.30	$ 15.42	$ 10.90
Total Return^{B, C, D}	13.32%	43.00%	(21.92)%
Ratios to Average Net Assets^G
Expenses before expense reductions	1.16%	1.15%	1.17%^A
Expenses net of voluntary waivers, if any	1.16%	1.15%	1.17%^A
Expenses net of all reductions	1.11%	1.11%	1.14%^A
Net investment income (loss)	.55%	.62%	.52%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 27,562	$ 7,072	$ 1,616
Portfolio turnover rate	84%	99%	77%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F For the period April 24, 2002 (commencement of sale of shares) to December 31, 2002.

^H Amount represents less than $.01 per share.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Notes to Financial Statements

For the period ended December 31, 2004

1. Significant Accounting Policies.

Equity-Income Portfolio, Growth Portfolio, High Income Portfolio, and Overseas Portfolio (the funds) are funds of Variable Insurance Products Fund. Asset Manager Portfolio, Contrafund Portfolio and Index 500 Portfolio (the funds) are funds of Variable Insurance Products Fund II. The Variable Insurance Products Fund and Variable Insurance Products Fund II (the trusts) (referred to in this report as Fidelity Variable Insurance Products) are registered under the Investment Company Act of 1940, as amended (the 1940 Act), as open-end management investment companies organized as Massachusetts business trusts. Certain funds may invest in affiliated fixed income and money market central funds (underlying funds) managed by affiliates of Fidelity Management & Research Company (FMR). Each fund is authorized to issue an unlimited number of shares. Shares of each fund may only be purchased by insurance companies for the purpose of funding variable annuity or variable life insurance contracts. Each fund offers the following classes of shares: Initial Class shares, Service Class shares and Service Class 2 shares. VIP Equity-Income, VIP Growth and VIP Contrafund Portfolios also offer Service Class 2R shares. VIP Overseas and VIP High Income Portfolios also offer Initial Class R, Service Class R, and Service Class 2R shares. All classes have equal rights and voting privileges, except for matters affecting a single class. Investment income, realized and unrealized capital gains and losses, the common expenses of the fund, and certain fund-level expense reductions, if any, are allocated on a pro rata basis to each class based on the relative net assets of each class to the total net assets of the fund. Each class differs with respect to distribution and service plan fees incurred. Certain expense reductions also differ by class.

Certain funds' investments in emerging markets can be subject to social, economic, regulatory, and political uncertainties and can be extremely volatile. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which require management to make certain estimates and assumptions at the date of the financial statements. The following summarizes the significant accounting policies of the funds and underlying funds (funds):

Security Valuation. Net asset value per share (NAV calculation) is calculated as of the close of business of the New York Stock Exchange, normally 4:00 p.m. Eastern time. Equity securities, including restricted securities, for which market quotations are available are valued at the last sale price or official closing price (closing bid price or last evaluated quote if no sale has occurred) on the primary market or exchange on which they trade. Debt securities, including restricted securities, for which quotations are readily available are valued at their most recent bid prices (sales prices if the principal market is an exchange) in the principal market in which such securities are normally traded, as determined by recognized dealers in such securities, or securities are valued on the basis of information provided by a pricing service. Pricing services use valuation matrices that incorporate both dealer-supplied valuations and valuation models. If prices are not readily available or do not accurately reflect fair value for a security, or if a security's value has been materially affected by events occurring after the close of the exchange or market on which the security is principally traded, that security may be valued by another method that the Board of Trustees believes accurately reflects fair value. A security's valuation may differ depending on the method used for determining value. Price movements in futures contracts and ADRs, market and trading trends, the bid/ask quotes of brokers and off-exchange institutional trading may be reviewed in the course of making a good faith determination of a security's fair value. Short-term securities with remaining maturities of sixty days or less for which quotations are not readily available are valued on the basis of amortized cost. Investments in open-end investment companies, including underlying funds, are valued at their net asset value each business day.

Foreign Currency. Certain funds may use foreign currency contracts to facilitate transactions in foreign-denominated securities. Losses from these transactions may arise from changes in the value of the foreign currency or if the counterparties do not perform under the contracts' terms.

Foreign-denominated assets, including investment securities, and liabilities are translated into U.S. dollars at the exchange rate at period end. Purchases and sales of investment securities, income and dividends received and expenses denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date.

The effects of exchange rate fluctuations on investments are included with the net realized and unrealized gain (loss) on investment securities. Other foreign currency transactions resulting in realized and unrealized gain (loss) are disclosed separately.

Investment Transactions and Income. Security transactions, including purchases and sales of the underlying funds, are accounted for as of trade date. Gains and losses on securities sold are determined on the basis of identified cost and may include proceeds received from litigation. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the funds are informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Distributions received on securities that represent a return of capital or capital gain are recorded as a reduction of cost of investments and/or as a realized gain. The funds estimate the components of distributions received that may be considered return of capital distributions or capital gain distributions. Large, non-recurring dividends recognized by the funds are presented separately on the Statement of Operations as "Special Dividends" and the impact of these dividends to net investment income per share is presented in the Financial Highlights. Interest income is accrued as earned. Interest income includes coupon interest and amortization of premium and accretion of discount on debt securities. Inflation-indexed bonds are fixed-income securities whose principal value is periodically adjusted according to the rate of inflation. Interest is accrued based on the principal value which is adjusted for inflation. Any increase in principal amount of an inflation-indexed bond is recorded as interest income, even though the principal is not received until maturity. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain. Debt obligations may be placed on non-accrual status and related interest income may be reduced by ceasing current

Annual Report

Notes to Financial Statements - continued

1. Significant Accounting Policies - continued

Investment Transactions and Income - continued

accruals and writing off interest receivables when the collection of all or a portion of interest has become doubtful based on consistently applied procedures. A debt obligation is removed from non-accrual status when the issuer resumes interest payments or when collectibility of interest is reasonably assured.

Expenses. Most expenses of each trust can be directly attributed to a fund. Expenses which cannot be directly attributed are apportioned among each fund in the trust.

Deferred Trustee Compensation. Under a Deferred Compensation Plan (the Plan) non-interested Trustees must defer receipt of a portion of, and may elect to defer receipt of an additional portion of, their annual compensation. Deferred amounts are treated as though equivalent dollar amounts had been invested in a cross-section of other Fidelity funds, and are marked-to-market. Deferred amounts remain in the fund until distributed in accordance with the Plan.

Income Tax Information and Distributions to Shareholders. Each year, each fund intends to qualify as a regulated investment company by distributing all of its taxable income and realized gains under Subchapter M of the Internal Revenue Code. As a result, no provision for income taxes is required in the accompanying financial statements. Foreign taxes are provided for based on each fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.

Distributions are recorded on the ex-dividend date. Income dividends and capital gain distributions are declared separately for each class. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from generally accepted accounting principles.

Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Temporary book-tax differences will reverse in a subsequent period.

Book-tax differences are primarily due to futures transactions, swap agreements, foreign currency transactions, passive foreign investment companies (PFIC), prior period premium and discount on debt securities, defaulted bonds, market discount, partnerships, financing transactions, capital loss carryforwards, redemptions in kind and losses deferred due to wash sales.

The tax-basis components of distributable earnings and the federal tax cost as of period end were as follows for each fund:

	Cost for Federal Income Tax Purposes	Unrealized Appreciation	Unrealized Depreciation	Net Unrealized Appreciation/ (Depreciation)
Asset Manager	$ 2,610,089,503	$ 290,106,762	$ (77,508,553)	$ 212,598,209
Contrafund	9,426,485,756	3,811,010,524	(61,655,951)	3,749,354,573
Equity-Income	8,626,903,027	3,162,571,582	(487,146,159)	2,675,425,423
Growth	7,836,788,157	2,326,119,909	(227,367,706)	2,098,752,203
High Income	1,741,532,055	106,238,193	(8,602,341)	97,635,852
Index 500	1,862,485,874	1,254,815,950	(206,580,316)	1,048,235,634
Overseas	1,880,129,646	559,624,822	(33,873,385)	525,751,437

	Undistributed Ordinary Income	Undistributed Long-term Capital Gain	Capital Loss Carryforward
Asset Manager	$ 72,216,287	$ -	$ (169,227,601)
Contrafund	35,699,521	-	(704,454,440)
Equity-Income	222,671,664	346,486,395	-
Growth	42,590,026	-	(3,653,617,452)
High Income	132,732,705	-	(1,144,183,642)
Index 500	49,722,398	-	(193,155,855)
Overseas	26,476,944	-	(472,629,652)

The tax character of distributions paid was as follows:

December 31, 2004	Ordinary Income	Long-term Capital Gains	Total
Asset Manager	$ 81,683,788	$ -	$ 81,683,788
Contrafund	33,283,266	-	33,283,266
Equity-Income	160,632,605	38,902,738	199,535,343
Growth	25,185,765	-	25,185,765
High Income	155,517,698	-	155,517,698
Index 500	40,638,037	-	40,638,037
Overseas	22,557,627	-	22,557,627

Annual Report

1. Significant Accounting Policies - continued

Income Tax Information and Distributions to Shareholders

The tax character of distributions paid was as follows - continued

December 31, 2003	Ordinary Income	Long-term Capital Gains	Total
Asset Manager	$ 104,597,799	$ -	$ 104,597,799
Contrafund	35,507,037	-	35,507,037
Equity-Income	152,426,442	-	152,426,442
Growth	23,104,405	-	23,104,405
High Income	110,937,981	-	110,937,981
Index 500	39,819,617	-	39,819,617
Overseas	11,225,102	-	11,225,102

Trading (Redemption) Fees. Initial Class R shares, Service Class R shares and Service Class 2R shares held less than 60 days are subject to a redemption fee equal to 1% of the proceeds of the redeemed shares. All redemption fees, including any estimated redemption fees paid by FMR, are retained by the applicable fund and accounted for as an addition to paid in capital.

2. Operating Policies.

Repurchase Agreements. FMR has received an Exemptive Order from the Securities and Exchange Commission (the SEC) which permits the funds and other affiliated entities of FMR to transfer uninvested cash balances into joint trading accounts. These accounts are then invested in repurchase agreements that are collateralized by U.S. Treasury or Government obligations. Certain funds may also invest directly with institutions, in repurchase agreements that are collateralized by commercial paper obligations and corporate obligations. Collateral is held in segregated accounts with custodian banks and may be obtained in the event of a default of the counterparty. Collateral is marked-to-market daily and maintained at a value at least equal to the principal amount of the repurchase agreement (including accrued interest).

Delayed Delivery Transactions and When-Issued Securities. Each fund may purchase or sell securities on a delayed delivery or when-issued basis. Payment and delivery may take place after the customary settlement period for that security. The price of the underlying securities and the date when the securities will be delivered and paid for are fixed at the time the transaction is negotiated. During the time a delayed delivery sell is outstanding, the contract is marked-to-market daily and equivalent deliverable securities are held for the transaction. The value of the securities purchased on a delayed delivery or when-issued basis are identified as such in each applicable fund's Schedule of Investments. Each fund may receive compensation for interest forgone in the purchase of a delayed delivery or when-issued security. With respect to purchase commitments, each fund identifies securities as segregated in its records with a value at least equal to the amount of the commitment. Losses may arise due to changes in the value of the underlying securities or if the counterparty does not perform under the contract's terms, or if the issuer does not issue the securities due to political, economic, or other factors.

Futures Contracts. Certain funds may use futures contracts to manage their exposure to the stock market. Buying futures tends to increase a fund's exposure to the underlying instrument, while selling futures tends to decrease a fund's exposure to the underlying instrument or hedge other fund investments. Futures contracts involve, to varying degrees, risk of loss in excess of any futures variation margin reflected in each applicable fund's Statement of Assets and Liabilities. The underlying face amount at value of any open futures contracts at period end is shown in each applicable fund's Schedule of Investments under the caption "Futures Contracts." This amount reflects each contract's exposure to the underlying instrument at period end. Losses may arise from changes in the value of the underlying instruments or if the counterparties do not perform under the contracts' terms. Gains (losses) are realized upon the expiration or closing of the futures contracts. Futures contracts are valued at the settlement price established each day by the board of trade or exchange on which they are traded.

Restricted Securities. Certain funds may invest in securities that are subject to legal or contractual restrictions on resale. These securities generally may be resold in transactions exempt from registration or to the public if the securities are registered. Disposal of these securities may involve time-consuming negotiations and expense, and prompt sale at an acceptable price may be difficult. Information regarding restricted securities is included at the end of each applicable fund's Schedule of Investments.

Loans and Other Direct Debt Instruments. Certain funds may invest in loans and loan participations, trade claims or other receivables. These investments may include standby financing commitments, including revolving credit facilities, that obligate the fund to supply additional cash to the borrower on demand. Loan participations involve a risk of insolvency of the lending bank or other financial intermediary. A fund may be contractually obligated to receive approval from the agent bank and/or borrower prior to the sale of these investments.

Annual Report

Notes to Financial Statements - continued

2. Operating Policies - continued

Swap Agreements. Certain funds may invest in swaps for the purpose of managing their exposure to interest rate, credit or market risk.

Interest rate swaps are agreements to exchange cash flows periodically based on a notional principal amount, for example, the exchange of fixed rate interest payments for floating rate interest payments. Periodic payments received or made by each applicable fund are recorded in the accompanying Statement of Operations as realized gains or losses, respectively. The primary risk associated with interest rate swaps is that unfavorable changes in the fluctuation of interest rates could adversely impact each fund.

Total return swaps are agreements to exchange the return generated by one instrument for the return generated by another instrument, for example, the agreement to pay interest in exchange for a market-linked return based on a notional amount. To the extent the total return of the index exceeds the offsetting interest obligation, each fund will receive a payment from the counterparty. To the extent it is less, each fund will make a payment to the counterparty. Periodic payments received or made by each applicable fund are recorded in the accompanying Statement of Operations as realized gains or losses, respectively.

Credit default swaps involve the exchange of a fixed rate premium for protection against the loss in value of an underlying debt instrument in the event of a defined credit event (such as payment default or bankruptcy). Under the terms of the swap, one party acts as a "guarantor" receiving a periodic payment that is a fixed percentage applied to a notional principal amount. In return the party agrees to purchase the notional amount of the underlying instrument, at par, if a credit event occurs during the term of the swap. Each applicable fund may enter into credit default swaps in which the fund or its counterparty act as guarantors. By acting as the guarantor of a swap, the fund assumes the market and credit risk of the underlying instrument including liquidity and loss of value. Periodic payments and premiums received or made by each applicable fund are recorded in the accompanying Statement of Operations as realized gains or losses, respectively.

Swaps are marked-to-market daily based on dealer-supplied valuations and changes in value are recorded as unrealized appreciation (depreciation). Gains or losses are realized upon early termination of the swap agreements. Collateral, in the form of cash or securities, may be required to be held in segregated accounts with each applicable fund's custodian in compliance with swap contracts. Risks may exceed amounts recognized on the Statement of Assets and Liabilities. These risks include changes in the fluctuation of interest rates or in the returns of the underlying instruments, failure of the counterparties to perform under the contracts' terms and the possible lack of liquidity with respect to the swap agreements. Details of swap agreements open at period end are included in each applicable fund's Schedule of Investments under the caption "Swap Agreements."

Mortgage Dollar Rolls. To earn additional income, certain funds may employ trading strategies which involve the sale and simultaneous agreement to repurchase similar securities ("mortgage dollar rolls") or the purchase and simultaneous agreement to sell similar securities ("reverse mortgage dollar rolls"). The securities traded are mortgage securities and bear the same interest rate but may be collateralized by different pools of mortgages. During the period between the sale and repurchase in a mortgage dollar roll transaction, a fund will not be entitled to receive interest and principal payments on the securities sold but will invest the proceeds of the sale in other securities which may enhance the yield and total return. In addition, the difference between the sale price and the future purchase price is recorded as an adjustment to investment income. During the period between the purchase and subsequent sale in a reverse mortgage dollar roll transaction a fund is entitled to interest and principal payments on the securities purchased. The price differential between the purchase and sale is recorded as an adjustment to investment income. Losses may arise due to changes in the value of the securities or if the counterparty does not perform under the terms of the agreement. If the counterparty files for bankruptcy or becomes insolvent, the fund's right to repurchase or sell securities may be limited.

3. Purchases and Sales of Investments.

Purchases and sales of securities, other than short-term securities and U.S. government securities, and in-kind transactions are noted in the table below.

	Purchases ($)	Sales ($)
Asset Manager	912,923,198	1,213,573,123
Contrafund	6,654,101,485	6,593,244,973
Equity-Income	2,315,881,327	2,277,968,277
Growth	7,269,389,954	8,239,247,322
High Income	2,223,362,294	2,482,350,638
Index 500	138,484,269	229,850,179
Overseas	1,798,890,461	1,655,883,993

For Index 500 Portfolio, securities delivered on an in-kind basis aggregated $353,017,055. Realized gain (loss) of $31,110,779 on securities delivered on an in-kind basis is included in the accompanying Statement of Operations as realized gain or loss on investment securities and is not taxable to the fund.

Annual Report

4. Fees and Other Transactions with Affiliates.

Management Fee. FMR and its affiliates provide the funds with investment management related services for which the funds pay a monthly management fee.

For all funds except the Index 500 Portfolio, the management fee is the sum of an individual fund fee rate applied to the average net assets of each fund and a group fee rate. The group fee rates differ for equity and fixed-income funds and are each based upon the average net assets of all the mutual funds advised by FMR. The group fee rates decrease as assets under management increase and increase as assets under management decrease. The annual individual fund fee rate is .45% of the fund's average net assets for High Income and Overseas Portfolios, .30% for Contrafund and Growth Portfolios, .25% for Asset Manager Portfolio, and .20% for Equity-Income Portfolio. The group fee rates averaged .28% for the equity funds and .13% for the fixed-income funds during the period.

For Index 500 Portfolio, FMR receives a fee that is computed at an annual rate of .24% of the fund's average net assets.

For the period each fund's total annual management fee rate, expressed as a percentage of each fund's average net assets, was as follows:

Asset Manager	.53%
Contrafund	.57%
Equity-Income	.47%
Growth	.58%
High Income	.58%
Index 500	.24%
Overseas	.72%

Sub-Adviser. Geode Capital Management, LLC (Geode), serves as sub-adviser for the Index 500 Portfolio. Geode provides discretionary investment advisory services to the fund and is paid by FMR for providing these services.

Distribution and Service Plan. In accordance with Rule 12b-1 of the 1940 Act, the funds have adopted separate 12b-1 Plans for each Service Class of shares. Each Service Class pays Fidelity Distributors Corporation (FDC), an affiliate of FMR, a service fee. For the period, the service fee is based on an annual rate of .10% of Service Class and Service Class R's average net assets and .25% of Service Class 2 and Service Class 2R's average net assets.

For the period, each class paid FDC the following amounts, all of which were re-allowed to insurance companies for the distribution of shares and providing shareholder support services:

	Service Class	Service Class 2	Service Class R	Service Class 2R
Asset Manager	$ 33,645	$ 68,053	$ -	$ -
Contrafund	1,850,568	3,019,587	-	11,308
Equity-Income	1,100,510	2,850,571	-	9,466
Growth	1,356,900	1,781,135	-	5,349
High Income	359,321	182,704	55	138
Index 500	18,715	202,280	-	-
Overseas	278,008	544,008	71,362	37,151

Transfer Agent Fees. Fidelity Investment Institutional Operations Company, Inc. (FIIOC), an affiliate of FMR, is the funds' transfer, dividend disbursing and shareholder servicing agent. FIIOC receives an asset-based fee with respect to each account. FIIOC pays a portion of the expenses related to the typesetting, printing and mailing of shareholder reports, except proxy statements. Each class pays a transfer agent fee, excluding out of pocket expenses, equal to an annual rate of .07% of their month end net assets. For the period, the total transfer agent fees paid by each class to FIIOC, including out of pocket expenses, were as follows:

Asset Manager
Initial Class	$ 1,886,467
Service Class	26,312
Service Class 2	24,310
	$ 1,937,089
Contrafund
Initial Class	$ 5,400,493
Service Class	1,238,671
Service Class 2	835,940
Service Class 2R	3,096
	$ 7,478,200

Annual Report

Notes to Financial Statements - continued

4. Fees and Other Transactions with Affiliates - continued

Transfer Agent Fees - continued

Equity-Income
Initial Class	$ 5,527,852
Service Class	728,268
Service Class 2	782,156
Service Class 2R	2,672
	$ 7,040,948
Growth
Initial Class	$ 5,336,742
Service Class	899,118
Service Class 2	486,224
Service Class 2R	1,447
	$ 6,723,531
High Income
Initial Class	$ 933,207
Service Class	240,550
Service Class 2	56,012
Initial Class R	36
Service Class R	36
Service Class 2R	36
	$ 1,229,877
Index 500
Initial Class	$ 1,867,269
Service Class	15,738
Service Class 2	62,603
	$ 1,945,610
Overseas
Initial Class	$ 972,332
Service Class	192,952
Service Class 2	157,275
Initial Class R	51,463
Service Class R	47,651
Service Class 2R	10,338
	$ 1,432,011

Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of FMR, maintains each fund's accounting records. The accounting fee is based on the level of average net assets for the month. Under a separate contract, FSC administers the security lending program. The security lending fee is based on the number and duration of lending transactions.

Central Funds. The funds may invest in affiliated Central Funds managed by Fidelity Investments Money Management, Inc. (FIMM) or Fidelity Management and Research Co, Inc. (FMRC), affiliates of FMR. The Central Funds are open-end investment companies available only to investment companies and other accounts managed by FMR and its affiliates. The Money Market central funds seek preservation of capital and current income. The High Income Central Investment Portfolio I seeks a high level of income and may also seek capital appreciation. The Floating Rate Central Investment Portfolio seeks a high level of current income. The central funds do not pay a management fee. Income distributions earned by the funds are recorded as income in the accompanying financial statements. Distributions from the Central Funds are noted in the table below:

	Income Distributions
Asset Manager	$ 9,377,924
Contrafund	13,680,343
Equity-Income	714,712
Growth	825,101
High Income	678,234
Index 500	259,769
Overseas	1,457,235

Annual Report

4. Fees and Other Transactions with Affiliates - continued

Central Funds - continued

Market value of securities delivered on an in-kind basis, in a non-taxable exchange, for 1,496,398 shares of the Fidelity High Income Central Investment Portfolio I aggregated $149,639,838 during the period for Asset Manager Portfolio.

Brokerage Commissions. Certain funds placed a portion of their portfolio transactions with brokerage firms which are affiliates of the investment adviser. The commissions paid to these affiliated firms were as follows:

	Amount
Asset Manager	$ 17,878
Contrafund	329,726
Equity-Income	127,479
Growth	609,973
High Income	1
Overseas	4,767

Interfund Lending Program. Pursuant to an Exemptive Order issued by the SEC, the funds, along with other registered investment companies having management contracts with FMR, may participate in an interfund lending program. This program provides an alternative credit facility allowing the funds to borrow from, or lend money to, other participating funds. At period end, there were no interfund loans outstanding. Each applicable fund's activity in this program during the period was as follows:

	Borrower or Lender	Average Daily Loan Balance	Weighted Average Interest Rate	Interest Earned (included in interest income)	Interest Expense
Equity-Income	Borrower	$ 8,867,217	1.63%	$ -	$ 9,256
Growth	Borrower	21,552,298	1.39%	-	39,066
High Income	Borrower	16,577,688	1.18%	-	8,699
Index 500	Borrower	4,096,300	1.43%	-	1,623

5. Committed Line of Credit.

Certain funds participate with other funds managed by FMR in a $4.2 billion credit facility (the "line of credit") to be utilized for temporary or emer-gency purposes to fund shareholder redemptions or for other short-term liquidity purposes. The participating funds have agreed to pay commitment fees on their pro rata portion of the line of credit. During the period, there were no borrowings on this line of credit.

6. Security Lending.

Certain funds lend portfolio securities from time to time in order to earn additional income. Each applicable fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the funds and any additional required collateral is delivered to the funds on the next business day. If the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, a fund could experience delays and costs in recovering the securities loaned or in gaining access to the collateral. Cash collateral is invested in cash equivalents. The value of loaned securities and cash collateral at period end are disclosed on each applicable fund's Statement of Assets and Liabilities.

7. Bank Borrowings.

Each fund is permitted to have bank borrowings for temporary or emergency purposes to fund shareholder redemptions. Each fund has established borrowing arrangements with certain banks. The interest rate on the borrowings is the bank's base rate, as revised from time to time. At period end, there were no bank borrowings outstanding. Each applicable fund's activity in this program during the period was as follows:

	Average Daily Loan Balance	Weighted Average Interest Rate
Equity-Income	$ 9,721,350	1.81%
High Income	6,280,667	1.62%

Annual Report

Notes to Financial Statements - continued

8. Expense Reductions.

FMR voluntarily agreed to reimburse certain funds to the extent annual operating expenses exceeded certain levels of average net assets as noted in the table below. Some expenses, for example interest expense, are excluded from this reimbursement. On February 17, 2005, the Board of Trustees approved the VIP Index 500 Portfolio 10 Basis Point Expense Contract and an amendment to the fund's management contract that will become effective March 1, 2005. Under the new contractual arrangements, FMR will be responsible for payment of all operating expenses of the fund (except Rule 12b-1 fees, fees and expenses of the non-interested trustees, interest, taxes, securities lending costs, brokerage commissions, and extraordinary expenses), and total operating expenses for Initial Class, Service Class and Service Class 2 will be limited to 0.10%, 0.20% and 0.35%, respectively.

	Expense Limitations	Reimbursement from adviser
Index 500
Initial Class	.28%	$ 2,050,886
Service Class	.38%	17,394
Service Class 2	.53%	70,230
		$ 2,138,510

Many of the brokers with whom FMR places trades on behalf of certain funds provided services to these funds in addition to trade execution. These services included payments of expenses on behalf of each applicable fund. In addition, through arrangements with each applicable fund's custodian, credits realized as a result of uninvested cash balances were used to reduce the fund's expenses. All of the applicable expense reductions are noted in the table below.

	Brokerage Service Arrangement	Custody expense reduction
Asset Manager	$ 232,376	$ 6,579
Contrafund	2,417,980	53,408
Equity-Income	873,945	612
Growth	3,292,493	1,393
High Income	3,244	729
Index 500	14	-
Overseas	912,968	1,208

9. Other Information.

At the end of the period, FMR or its affiliates and certain otherwise unaffiliated shareholders each were owners of record of more than 10% of the total outstanding shares of the following funds:

	Affiliated %	Number of Unaffiliated Shareholders	Unaffiliated Shareholders %
Asset Manager	22%	1	18%
Contrafund	13%	2	32%
Equity-Income	11%	2	37%
Growth	11%	2	35%
High Income	20%	2	49%
Index 500	35%	-	-
Overseas	14%	2	39%

Annual Report

Report of Independent Registered Public Accounting Firm

To the Trustees of Variable Insurance Products Fund II and Shareholders of Contrafund Portfolio:

We have audited the accompanying statement of assets and liabilities of Contrafund Portfolio (the Fund), a fund of Variable Insurance Products Fund II, including the portfolio of investments, as of December 31, 2004, and the related statement of operations for the year then ended, the statement of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of December 31, 2004, by correspondence with the custodians and brokers; where replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Contrafund Portfolio as of December 31, 2004, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and its financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.

/s/DELOITTE & TOUCHE LLP

DELOITTE & TOUCHE LLP

Boston, Massachusetts

February 10, 2005

Annual Report

Report of Independent Registered Public Accounting Firm

To the Trustees of Variable Insurance Products Fund II and Shareholders of Asset Manager Portfolio and Index 500 Portfolio:

We have audited the accompanying statement of assets and liabilities of Asset Manager Portfolio and Index 500 Portfolio, (the Funds), funds of Variable Insurance Products II, including the portfolios of investments, as of December 31, 2004, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the periods presented. These financial statements and financial highlights are the responsibility of the Funds' management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Funds' internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of December 31, 2004, by correspondence with the custodians and brokers; where replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Asset Manager Portfolio and Index 500 Portfolio as of December 31, 2004, the results of their operations for the year then ended, the changes in their net assets for each of the two years in the period then ended, and their financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America.

/s/DELOITTE & TOUCHE LLP

DELOITTE & TOUCHE LLP

Boston, Massachusetts

February 18, 2005

Annual Report

Report of Independent Registered Public Accounting Firm

To the Trustees of Variable Insurance Products Fund and Shareholders of Equity-Income Portfolio and Growth Portfolio:

In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of Equity-Income Portfolio and Growth Portfolio (funds of Variable Insurance Products Fund) at December 31, 2004 and the results of their operations, the changes in their net assets and the financial highlights for the periods indicated, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of Variable Insurance Products Funds' management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at December 31, 2004 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP

PricewaterhouseCoopers LLP

Boston, Massachusetts

February 10, 2005

Annual Report

Report of Independent Registered Public Accounting Firm

To the Trustees of Variable Insurance Products Fund and the Shareholders of High Income Portfolio:

In our opinion, the accompanying statement of assets and liabilities, including the schedule of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of High Income Portfolio (a fund of Variable Insurance Products Fund) at December 31, 2004 and the results of its operations, the changes in its net assets and the financial highlights for the periods indicated, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the High Income Portfolio's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at December 31, 2004 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP

PricewaterhouseCoopers LLP

Boston, Massachusetts

February 18, 2005

Annual Report

Report of Independent Registered Public Accounting Firm

To the Trustees of Variable Insurance Products Fund and the Shareholders of Overseas Portfolio:

In our opinion, the accompanying statement of assets and liabilities, including the schedule of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of Overseas Portfolio (a fund of Variable Insurance Products Fund) at December 31, 2004 and the results of its operations, the changes in its net assets and the financial highlights for the periods indicated, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Overseas Portfolio's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at December 31, 2004 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP

PricewaterhouseCoopers LLP

Boston, Massachusetts

February 14, 2005

Annual Report

December 31, 2004 (Unaudited)

Fidelity Floating Rate Central Investment Portfolio

Top Fifty Holdings (excluding cash equivalents)*

	Principal Amount	Value	% of Fund's Net Assets
General Growth Properties, Inc. Tranche B, term loan 4.53% 11/12/08	$ 6,000,000	$ 6,015,000	4.8
Lake Las Vegas LLC Tranche 1, term loan 5.1197% 11/1/09	4,310,000	4,342,325	3.5
Qwest Corp. Tranche A, term loan 7.39% 6/30/07	4,000,000	4,170,000	3.3
UPC Distribution Holdings BV Tranche F, term loan 5.98% 12/31/11	4,000,000	4,050,000	3.2
Dex Media West LLC/Dex Media West Finance Co. Tranche B, term loan 4.1033% 9/9/10	3,993,293	4,043,209	3.2
El Paso Corp. Credit-Linked Deposit 5.15% 11/22/09	4,000,000	4,030,000	3.2
Marina District Finance Co., Inc. term loan 3.93% 10/14/11	4,000,000	4,030,000	3.2
R.H. Donnelley Corp. Tranche B2, term loan 4.3086% 6/30/11	3,965,788	4,005,446	3.2
PacifiCare Health Systems, Inc. Tranche B, term loan 4.1618% 12/6/10	4,000,000	4,000,000	3.2
Nexstar Broadcasting, Inc. Tranche D, term loan 4.31% 12/31/10	3,989,975	3,999,975	3.2
Starwood Hotels & Resorts Worldwide, Inc. term loan 3.67% 10/9/06	3,666,667	3,666,667	2.9
Smurfit-Stone Container Enterprises, Inc. Tranche B, term loan 4.5208% 11/1/11	3,489,621	3,537,603	2.8
Vicar Operating, Inc. Tranche F, term loan 4.1875% 9/30/08	3,100,000	3,119,375	2.5
RailAmerica, Inc. term loan 4.375% 9/29/11	3,000,000	3,052,500	2.4
Constellation Brands, Inc. Tranche B, term loan 4.5866% 12/22/11	3,000,000	3,037,500	2.4
Texas Genco LLC term loan 4.48% 12/14/11	3,000,000	3,033,750	2.4
Lamar Media Corp. Tranche C, term loan 4.0625% 6/30/10	3,000,000	3,030,000	2.4
ON Semiconductor Corp. Tranche G, term loan 5.5625% 12/15/11	3,000,000	3,007,500	2.4
HCA, Inc. term loan 3.42% 11/9/09	3,000,000	2,992,500	2.4
Charter Communication Operating LLC Tranche A, term loan 5.13% 4/27/10	3,000,000	2,981,250	2.4
Century Cable Holdings LLC Tranche B, term loan 7.25% 6/30/09	3,000,000	2,977,500	2.4
Kansas City Southern Railway Co. Tranche B1, term loan 4.0939% 3/30/08	2,800,000	2,842,000	2.3
Iron Mountain, Inc. Tranche R, term loan 4.1875% 4/2/11	2,500,000	2,512,500	2.0
NRG Energy, Inc. term loan 4.95% 12/24/11	2,193,750	2,193,750	1.8
Valor Telecommunications Enterprises LLC Tranche 2, term loan 10.0815% 11/10/11	2,000,000	2,060,000	1.6
AM General LLC Tranche B1, term loan 6.759% 11/1/11	2,000,000	2,040,000	1.6
Simmons Bedding Co. Tranche C, term loan 4.0535% 12/19/11	2,000,000	2,030,000	1.6
Herbalife International, Inc. term loan 4.58% 12/21/10	2,000,000	2,027,500	1.6
Reliant Energy, Inc. term loan 4.795% 4/30/10	2,000,000	2,025,000	1.6
Advertising Directory Solutions, Inc. Tranche 1, term loan 4.4% 11/9/11	2,000,000	2,015,000	1.6
LNR Property Corp. Tranche B, term loan 5.59% 1/31/08	2,000,000	2,010,000	1.6
Community Health Systems, Inc. term loan 4.15% 8/19/11	1,995,000	2,004,975	1.6
Nextel Communications, Inc. Tranche E, term loan 4.6875% 12/15/10	1,994,962	1,996,209	1.6
NRG Energy, Inc. Credit-Linked Deposit 4.325% 12/24/11	1,706,250	1,708,383	1.4
Domino's, Inc. term loan 4.3125% 6/25/10	1,632,486	1,650,852	1.3
Goodman Global Holdings, Inc. term loan 4.8125% 12/23/11	1,220,000	1,226,100	1.0
Smurfit-Stone Container Enterprises, Inc. Tranche C, term loan 4.3958% 11/1/11	1,073,729	1,088,493	0.9
Georgia-Pacific Corp. term loan 3.4647% 7/2/09	1,000,000	998,750	0.8
Cooper Standard Auto, Inc. Tranche C, term loan 6.25% 12/23/11	616,667	624,375	0.5
Landry's Seafood Restaurants, Inc. term loan 4.5276% 12/28/10	465,000	469,650	0.4
Smurfit-Stone Container Enterprises, Inc. Credit-Linked Deposit 2.4% 11/1/10	436,650	442,654	0.4
Cooper Standard Auto, Inc. Tranche B, term loan 6.25% 12/23/11	383,333	388,125	0.3

* The fund commenced operations on December 15, 2004 and holds 42 securities, excluding cash equivalents, which represent 88.9% of the fund's net assets.

Annual Report

December 31, 2004 (Unaudited)

Fidelity High Income Central Investment Portfolio 1

Top Fifty Holdings (excluding cash equivalents)

	Principal Amount	Value	% of Fund's Net Assets
Ship Finance International Ltd. 8.5% 12/15/13	$ 17,800,000	$ 18,333,983	1.7
Invensys PLC 9.875% 3/15/11	11,735,000	12,673,800	1.2
Teekay Shipping Corp. 8.875% 7/15/11	10,780,000	12,504,800	1.1
Micron Technology, Inc. 6.5% 9/30/05	11,761,905	11,732,500	1.1
General Maritime Corp. 10% 3/15/13	9,940,000	11,431,000	1.1
EchoStar DBS Corp. 5.75% 10/1/08	10,505,000	10,662,575	1.0
Celestica, Inc. 7.875% 7/1/11	9,430,000	10,090,100	0.9
Millicom International Cellular SA 10% 12/1/13	8,805,000	9,201,225	0.8
Western Financial Bank 9.625% 5/15/12	8,060,000	9,188,400	0.8
PerkinElmer, Inc. 8.875% 1/15/13	7,470,000	8,497,125	0.8
OMI Corp. 7.625% 12/1/13	7,645,000	8,180,150	0.8
TFM SA de CV yankee 11.75% 6/15/09	8,030,000	8,150,450	0.8
BCP Caylux Holdings Luxembourg SCA 9.625% 6/15/14	7,120,000	7,974,400	0.7
Compass Minerals International, Inc. 0% 6/1/13	9,175,000	7,431,750	0.7
Gerdau AmeriSteel Corp./GUSAP Partners 10.375% 7/15/11	6,015,000	7,067,625	0.7
The Reader's Digest Association, Inc. 6.5% 3/1/11	6,610,000	6,907,450	0.6
Qwest Capital Funding, Inc. 7.25% 2/15/11	7,055,000	6,772,800	0.6
Wyndham International, Inc. term loan 7.125% 6/30/06	6,739,515	6,756,364	0.6
Hanover Compressor Co. 0% 3/31/07	7,660,000	6,664,200	0.6
NRG Energy, Inc. 8% 12/15/13	5,998,000	6,545,318	0.6
MGM MIRAGE 6% 10/1/09	6,360,000	6,519,000	0.6
KB Home 7.75% 2/1/10	6,055,000	6,509,125	0.6
Norske Skog Canada Ltd. 8.625% 6/15/11	6,065,000	6,489,550	0.6
Tenet Healthcare Corp. 6.375% 12/1/11	6,995,000	6,435,400	0.6
Millennium America, Inc. 9.25% 6/15/08	5,690,000	6,429,700	0.6
Elan Finance PLC/Elan Finance Corp. 7.75% 11/15/11	5,980,000	6,398,600	0.6
Mohegan Tribal Gaming Authority 6.375% 7/15/09	6,185,000	6,393,744	0.6
American Real Estate Partners/American Real Estate Finance Corp. 8.125% 6/1/12	5,920,000	6,312,200	0.6
Huntsman LLC 9.32% 7/15/11	5,660,000	6,310,900	0.6
Wheeling Island Gaming, Inc. 10.125% 12/15/09	5,835,000	6,214,275	0.6
General Growth Properties, Inc.:
Tranche B, term loan 4.53% 11/12/08	6,100,000	6,115,250	0.6
Tranche A, term loan 4.53% 11/12/07	6,100,000	6,100,000	0.6
Berry Plastics Corp. 10.75% 7/15/12	5,310,000	6,066,675	0.6
Astoria Energy LLC term loan 7.1882% 4/15/12	5,890,000	6,007,800	0.6
Levi Strauss & Co. 12.25% 12/15/12	5,370,000	5,960,700	0.5
Hilton Head Communications LP Tranche B, term loan 6.5% 3/31/08	6,050,000	5,944,125	0.5
Sonic Automotive, Inc. 8.625% 8/15/13	5,550,000	5,938,500	0.5
CDRV Investors, Inc. 0% 1/1/15	9,590,000	5,921,825	0.5
Hilcorp Energy I LP/Hilcorp Finance Co. 10.5% 9/1/10	5,205,000	5,881,650	0.5
Riverside Energy Center LLC term loan 6.38% 6/24/11	5,793,001	5,879,896	0.5
Wise Metals Group LLC/Alloys Finance 10.25% 5/15/12	5,830,000	5,830,000	0.5
Asbury Automotive Group, Inc. 9% 6/15/12	5,420,000	5,704,550	0.5
Xerox Corp. 7.125% 6/15/10	5,235,000	5,653,800	0.5
Browning-Ferris Industries, Inc. 6.375% 1/15/08	5,755,000	5,639,900	0.5
Range Resources Corp. 7.375% 7/15/13	5,235,000	5,601,450	0.5
Texas Industries, Inc. 10.25% 6/15/11	4,650,000	5,487,000	0.5
Owens-Brockway Glass Container, Inc. 8.875% 2/15/09	5,050,000	5,479,250	0.5
U.S. West Capital Funding, Inc. 6.375% 7/15/08	5,547,000	5,477,663	0.5
Nextel Communications, Inc. 6.875% 10/31/13	4,970,000	5,392,450	0.5
Qwest Capital Funding, Inc. 7% 8/3/09	5,440,000	5,385,600	0.5

Top 50 Holdings as a Percentage of Fund's Net Assets - 33.6%

Annual Report

Trustees and Officers

The Trustees, Member of the Advisory Board, and executive officers of the trusts and funds, as applicable, are listed below. The Board of Trustees governs each fund and is responsible for protecting the interests of shareholders. The Trustees are experienced executives who meet periodically throughout the year to oversee each fund's activities, review contractual arrangements with companies that provide services to each fund, and review each fund's performance. Except for William O. McCoy, Dennis J. Dirks, and Kenneth L. Wolfe, each of the Trustees oversees 301 funds advised by FMR or an affiliate. Mr. McCoy oversees 303 funds advised by FMR or an affiliate. Mr. Dirks and Mr. Wolfe oversee 233 funds advised by FMR or an affiliate.

The Trustees hold office without limit in time except that (a) any Trustee may resign; (b) any Trustee may be removed by written instrument, signed by at least two-thirds of the number of Trustees prior to such removal; (c) any Trustee who requests to be retired or who has become incapacitated by illness or injury may be retired by written instrument signed by a majority of the other Trustees; and (d) any Trustee may be removed at any special meeting of shareholders by a two-thirds vote of the outstanding voting securities of the trust. In any event, each non-interested Trustee shall retire not later than the last day of the calendar year in which his or her 72nd birthday occurs. The executive officers and Advisory Board Member hold office without limit in time, except that any officer and Advisory Board Member may resign or may be removed by a vote of a majority of the Trustees at any regular meeting or any special meeting of the Trustees. Except as indicated, each individual has held the office shown or other offices in the same company for the past five years.

The funds' Statement of Additional Information (SAI) includes more information about the Trustees. To request a free copy, call Fidelity at 1-800-544-5429.

Interested Trustees*:

Correspondence intended for each Trustee who is an "interested person" (as defined in the 1940 Act) may be sent to Fidelity Investments, 82 Devonshire Street, Boston, Massachusetts 02109.

Name, Age; Principal Occupation
Edward C. Johnson 3d (74)**
	Year of Election or Appointment: 1981 or 1988 Trustee of Variable Insurance Products Fund (1981) and Variable Insurance Products Fund II (1988). Mr. Johnson is Chairman of the Board of Trustees. Mr. Johnson serves as Chief Executive Officer, Chairman, and a Director of FMR Corp.; a Director and Chairman of the Board and of the Executive Committee of FMR; Chairman and a Director of Fidelity Management & Research (Far East) Inc.; Chairman (1998) and a Director of Fidelity Investments Money Management, Inc.; and Chairman (2001) and a Director (2000) of FMR Co., Inc.
Abigail P. Johnson (43)**
	Year of Election or Appointment: 2001 Senior Vice President of VIP Asset Manager (2001), VIP Contrafund (2001), VIP Equity-Income (2001), VIP Growth (2001), VIP High Income (2001), VIP Index 500 (2001), and VIP Overseas (2001). Ms. Johnson also serves as Senior Vice President of other Fidelity funds (2001). She is President and a Director of FMR (2001), Fidelity Investments Money Management, Inc. (2001), FMR Co., Inc. (2001), and a Director of FMR Corp. Previously, Ms. Johnson managed a number of Fidelity funds.
Laura B. Cronin (50)
	Year of Election or Appointment: 2003 Ms. Cronin is an Executive Vice President (2002) and Chief Financial Officer (2002) of FMR Corp. and is a member of the Fidelity Management Committee (2003). Previously, Ms. Cronin served as Vice President of Finance of FMR (1997-1999), and Chief Financial Officer of FMR (1999-2001), Fidelity Personal Investments (2001), and Fidelity Brokerage Company (2001-2002).
Robert L. Reynolds (52)
	Year of Election or Appointment: 2003 Mr. Reynolds is a Director (2003) and Chief Operating Officer (2002) of FMR Corp. and is the head of the Fidelity Management Committee (2003). He also serves on the Board at Fidelity Investments Canada, Ltd. (2000). Previously, Mr. Reynolds served as President of Fidelity Investments Institutional Retirement Group (1996-2000).

* Trustees have been determined to be "Interested Trustees" by virtue of, among other things, their affiliation with the trusts or various entities under common control with FMR.

** Edward C. Johnson 3d, Trustee, is Abigail P. Johnson's father.

Annual Report

Trustees and Officers - continued

Non-Interested Trustees:

Correspondence intended for each non-interested Trustee (that is, the Trustees other than the Interested Trustees) may be sent to Fidelity Investments, P.O. Box 55235, Boston, Massachusetts 02205-5235.

Dennis J. Dirks (56)
	Year of Election or Appointment: 2005 Mr. Dirks also serves as a Trustee (2005) or Member of the Advisory Board (2004) of other investment companies advised by FMR. Prior to his retirement in May 2003, Mr. Dirks was Chief Operating Officer and a member of the Board of The Depository Trust & Clearing Corporation (DTCC) (1999-2003). He also served as President, Chief Operating Officer, and Board member of The Depository Trust Company (DTC) (1999-2003) and President and Board member of the National Securities Clearing Corporation (NSCC) (1999-2003). In addition, Mr. Dirks served as Chief Executive Officer and Board member of the Government Securities Clearing Corporation (2001-2003) and Chief Executive Officer and Board member of the Mortgage-Backed Securities Clearing Corporation (2001-2003).
Robert M. Gates (61)
	Year of Election or Appointment: 1997 Dr. Gates is Vice Chairman of the non-interested Trustees (2005). Dr. Gates is President of Texas A&M University (2002). He was Director of the Central Intelligence Agency (CIA) from 1991 to 1993. From 1989 to 1991, Dr. Gates served as Assistant to the President of the United States and Deputy National Security Advisor. Dr. Gates is a Director of NACCO Industries, Inc. (mining and manufacturing), Parker Drilling Co., Inc. (drilling and rental tools for the energy industry, 2001), and Brinker International (restaurant management, 2003). He also serves as a member of the Advisory Board of VoteHere.net (secure Internet voting, 2001). Previously, Dr. Gates served as a Director of LucasVarity PLC (automotive components and diesel engines), a Director of TRW Inc. (automotive, space, defense, and information technology), and Dean of the George Bush School of Government and Public Service at Texas A&M University (1999-2001). Dr. Gates also is a Trustee of the Forum for International Policy.
George H. Heilmeier (68)
	Year of Election or Appointment: 2004 Dr. Heilmeier is Chairman Emeritus of Telcordia Technologies (communication software and systems), where prior to his retirement, he served as company Chairman and Chief Executive Officer. He currently serves on the Boards of Directors of The Mitre Corporation (systems engineering and information technology support for the government), INET Technologies Inc. (telecommunications network surveillance, 2001), Teletech Holdings (customer management services), and HRL Laboratories (private research and development, 2004). He is Chairman of the General Motors Technology Advisory Committee and a Life Fellow of the Institute of Electrical and Electronics Engineers (IEEE) (2000). Dr. Heilmeier is a member of the Defense Science Board and the National Security Agency Advisory Board. He is also a member of the National Academy of Engineering, the American Academy of Arts and Sciences, and the Board of Overseers of the School of Engineering and Applied Science of the University of Pennsylvania. Previously, Dr. Heilmeier served as a Director of TRW Inc. (automotive, space, defense, and information technology, 1992-2002), Compaq (1994-2002), and Automatic Data Processing, Inc. (ADP) (technology-based business outsourcing, 1995-2002).
Marie L. Knowles (58)
	Year of Election or Appointment: 2001 Prior to Ms. Knowles' retirement in June 2000, she served as Executive Vice President and Chief Financial Officer of Atlantic Richfield Company (ARCO) (diversified energy, 1996-2000). From 1993 to 1996, she was a Senior Vice President of ARCO and President of ARCO Transportation Company. She served as a Director of ARCO from 1996 to 1998. She currently serves as a Director of Phelps Dodge Corporation (copper mining and manufacturing), URS Corporation (multidisciplinary engineering, 1999), and McKesson Corporation (healthcare service, 2002). Ms. Knowles is a Trustee of the Brookings Institution and the Catalina Island Conservancy and also serves as a member of the Advisory Board for the School of Engineering of the University of Southern California.
Ned C. Lautenbach (60)
	Year of Election or Appointment: 2000 Mr. Lautenbach has been a partner of Clayton, Dubilier & Rice, Inc. (private equity investment firm) since September 1998. Previously, Mr. Lautenbach was with the International Business Machines Corporation (IBM) from 1968 until his retirement in 1998. He was most recently Senior Vice President and Group Executive of Worldwide Sales and Services. From 1993 to 1995, he was Chairman of IBM World Trade Corporation, and from 1994 to 1998 was a member of IBM's Corporate Executive Committee. Mr. Lautenbach serves as Co-Chairman and a Director of Covansys, Inc. (global provider of business and technology solutions, 2000). In addition, he is a Director of Italtel Holding S.p.A. (telecommunications (Milan, Italy), 2004) and Eaton Corporation (diversified industrial) as well as the Philharmonic Center for the Arts in Naples, Florida (1999). He also is a member of the Council on Foreign Relations.
Marvin L. Mann (71)
	Year of Election or Appointment: 1993 Mr. Mann is Chairman of the non-interested Trustees (2001). He is Chairman Emeritus of Lexmark International, Inc. (computer peripherals), where he served as CEO until April 1998, retired as Chairman May 1999, and remains a member of the Board. Prior to 1991, he held the positions of Vice President of International Business Machines Corporation (IBM) and President and General Manager of various IBM divisions and subsidiaries. He is a member of the Executive Committee of the Independent Director's Council of the Investment Company Institute. In addition, Mr. Mann is a member of the President's Cabinet at the University of Alabama and the Board of Visitors of the Culverhouse College of Commerce and Business Administration at the University of Alabama.
William O. McCoy (71)
	Year of Election or Appointment: 1997 Prior to his retirement in December 1994, Mr. McCoy was Vice Chairman of the Board of BellSouth Corporation (telecommunications) and President of BellSouth Enterprises. He is currently a Director of Liberty Corporation (holding company), Duke Realty Corporation (real estate), and Progress Energy, Inc. (electric utility). He is also a partner of Franklin Street Partners (private investment management firm) and a member of the Research Triangle Foundation Board. In addition, Mr. McCoy served as the Interim Chancellor (1999-2000) and a member of the Board of Visitors (1994-1998) for the University of North Carolina at Chapel Hill and currently serves on the Board of Directors of the University of North Carolina Health Care System and the Board of Visitors of the Kenan-Flagler Business School (University of North Carolina at Chapel Hill). He also served as Vice President of Finance for the University of North Carolina (16-school system, 1995-1998).
Cornelia M. Small (60)
	Year of Election or Appointment: 2005 Ms. Small is a member (2000) and Chairperson (2002) of the Investment Committee, and a member (2002) of the Board of Trustees of Smith College. Previously, she served as Chief Investment Officer (1999-2000), Director of Global Equity Investments (1996-1999), and a member of the Board of Directors of Scudder, Stevens & Clark (1990-1997) and Scudder Kemper Investments (1997-1998). In addition, Ms. Small served as Co-Chair (2000-2003) of the Annual Fund for the Fletcher School of Law and Diplomacy.
William S. Stavropoulos (65)
	Year of Election or Appointment: 2001 Mr. Stavropoulos is Chairman of the Board (2000), CEO (2002), a position he previously held from 1995-2000, Chairman of the Executive Committee (2000), and a Member of the Board of Directors of The Dow Chemical Company. Since joining The Dow Chemical Company in 1967, Mr. Stavropoulos served in numerous senior management positions, including President (1993-2000; 2002-2003). Currently, he is a Director of NCR Corporation (data warehousing and technology solutions), BellSouth Corporation (telecommunications), Chemical Financial Corporation, and Maersk Inc. (industrial conglomerate, 2002). He also serves as a member of the Board of Trustees of the American Enterprise Institute for Public Policy Research. In addition, Mr. Stavropoulos is a member of The Business Council, J.P. Morgan International Council and the University of Notre Dame Advisory Council for the College of Science.
Kenneth L. Wolfe (65)
	Year of Election or Appointment: 2005 Mr. Wolfe also serves as a Trustee (2005) or Member of the Advisory Board (2004) of other investment companies advised by FMR. Prior to his retirement in 2001, Mr. Wolfe was Chairman and Chief Executive Officer of Hershey Foods Corporation (1993-2001). He currently serves as a member of the boards of Adelphia Communications Corporation (2003), Bausch & Lomb, Inc., and Revlon Inc. (2004).

Advisory Board Member and Executive Officers:

Correspondence intended for each executive officer and Mr. Lynch may be sent to Fidelity Investments, 82 Devonshire Street, Boston, Massachusetts 02109

Name, Age; Principal Occupation
Peter S. Lynch (61)
	Year of Election or Appointment: 2003 Member of the Advisory Board of Variable Insurance Products Fund and Variable Insurance Products Fund II. Vice Chairman and a Director of FMR, and Vice Chairman (2001) and a Director (2000) of FMR Co., Inc. Previously, Mr. Lynch served as a Trustee of the Fidelity funds (1990-2003). Prior to May 31, 1990, he was a Director of FMR and Executive Vice President of FMR (a position he held until March 31, 1991), Vice President of Fidelity^® Magellan^® Fund and FMR Growth Group Leader, and Managing Director of FMR Corp. Mr. Lynch was also Vice President of Fidelity Investments Corporate Services. In addition, he serves as a Trustee of Boston College, Massachusetts Eye & Ear Infirmary, Historic Deerfield, John F. Kennedy Library, and the Museum of Fine Arts of Boston.
Philip L. Bullen (45)
	Year of Election or Appointment: 2001 Vice President of VIP Index 500 and VIP Overseas. Mr. Bullen also serves as Vice President of certain Equity Funds (2001) and certain High Income Funds (2001). He is Senior Vice President of FMR (2001) and FMR Co., Inc. (2001), President and a Director of Fidelity Management & Research (Far East) Inc. (2001), President and a Director of Fidelity Management & Research (U.K.) Inc. (2002), and a Director of Strategic Advisers, Inc. (2002). Before joining Fidelity Investments, Mr. Bullen was President and Chief Investment Officer of Santander Global Advisors (1997-2000) and President and Chief Executive Officer of Boston's Baring Asset Management Inc. (1994-1997).
Bart A. Grenier (45)
	Year of Election or Appointment: 2001 Vice President of VIP Asset Manager, VIP Equity-Income, and VIP High Income. Mr. Grenier also serves as Vice President of certain Equity Funds (2001), a position he previously held from 1999 to 2000, and Vice President of certain High Income Funds (2002). He is Senior Vice President of FMR (1999) and FMR Co., Inc. (2001), and President and Director of Strategic Advisers, Inc. (2002). He also heads Fidelity's Asset Allocation Group (2000), Fidelity's Growth and Income Group (2001), Fidelity's Value Group (2001), and Fidelity's High Income Division (2001). Previously, Mr. Grenier served as President of Fidelity Ventures (2000), Vice President of certain High Income Funds (1997-2000), High Income Division Head (1997-2000), Group Leader of the Income-Growth and Asset Allocation-Income Groups (1996-2000), and Assistant Equity Division Head (1997-2000).
John B. McDowell (46)
	Year of Election or Appointment: 2002 Vice President of VIP Contrafund and VIP Growth. Mr. McDowell also serves as Vice President of certain Equity Funds (2002). He is Senior Vice President of FMR (1999), FMR Co., Inc. (2001), and Fidelity Management Trust Company (FMTC). Since joining Fidelity Investments in 1985, Mr. McDowell has worked as a research analyst and manager.
Charles S. Morrison (44)
	Year of Election or Appointment: 2002 Vice President of VIP Asset Manager. Mr. Morrison also serves as Vice President of Fidelity's Bond Funds (2002), and Vice President of certain Asset Allocation and Balanced Funds (2002). He serves as Vice President (2002) and Bond Group Leader (2002) of Fidelity Investments Fixed Income Division. Mr. Morrison is also Vice President of FIMM (2002) and FMR (2002). Mr. Morrison joined Fidelity in 1987 as a Corporate Bond Analyst in the Fixed Income Research Division.
David L. Murphy (56)
	Year of Election or Appointment: 2002 Vice President of VIP Asset Manager. Mr. Murphy also serves as Vice President of Fidelity's Money Market Funds (2002) and Vice President of certain Asset Allocation Funds (2003). He serves as Senior Vice President (2000) and Money Market Group Leader (2002) of the Fidelity Investments Fixed Income Division. Mr. Murphy is also a Senior Vice President of FIMM (2003) and a Vice President of FMR (2000). Previously, Mr. Murphy served as Bond Group Leader (2000-2002) and Vice President of Fidelity's Taxable Bond Funds (2000-2002) and Fidelity's Municipal Bond Funds (2001-2002). Mr. Murphy joined Fidelity in 1989 as a portfolio manager in the Bond Group.
Matthew J. Conti (38)
	Year of Election or Appointment: 2002 or 2003 Vice President of VIP Equity-Income and VIP High Income. Mr. Conti also serves as Vice President of other funds advised by FMR. Prior to assuming his current responsibilities, Mr. Conti managed a variety of Fidelity funds. Mr. Conti also serves as Vice President of FMR (2003) and FMR Co., Inc. (2003).
William Danoff (44)
	Year of Election or Appointment: 1995 Vice President of VIP Contrafund. Mr. Danoff serves as Vice President of other funds advised by FMR. Mr. Danoff also serves as Senior Vice President of FMR and FMR Co., Inc. (2001).
Richard C. Habermann (64)
	Year of Election or Appointment: 2001 Vice President of VIP Asset Manager and VIP Asset Manager: Growth. Mr. Habermann also serves as Vice President of other funds advised by FMR. Prior to assuming his current responsibilities, Mr. Habermann managed a variety of Fidelity funds. Mr. Habermann also serves as Senior Vice President of FMR and FMR Co., Inc. (2001).
Name, Age; Principal Occupation
Richard R. Mace, Jr. (43)
	Year of Election or Appointment: 1996 Vice President of VIP Overseas. Mr. Mace serves as Vice President of other funds advised by FMR. Mr. Mace also serves as Senior Vice President of FMR (2001) and FMR Co., Inc. (2001).
Charles A. Mangum (40)
	Year of Election or Appointment: 2002Vice President of VIP Asset Manager and VIP Asset Manager: Growth. Mr. Magnum also serves as Vice President of other funds advised by FMR. Prior to assuming his current responsibilities, Mr. Mangum managed a variety of Fidelity funds. Mr. Mangum also serves as Vice President of FMR and FMR Co., Inc. (2001).
Christine McConnell (46)
	Year of Election or Appointment: 2000 Vice President of VIP Asset Manager and VIP Asset Manager: Growth. Ms. McConnell also serves as Vice President of another fund advised by FMR. Prior to assuming her current responsibilities, Ms. McConnell managed a variety of Fidelity funds. Ms. McConnell also serves as Vice President of FMR (2003) and FMR Co., Inc. (2003).
James Kim Miller (41)
	Year of Election or Appointment: 2004 Vice President of VIP Asset Manager and VIP Asset Manager: Growth. Mr. Miller also serves as Vice President of other funds advised by FMR. Prior to assuming his current responsibilities, Mr. Miller managed a variety of Fidelity funds.
Ford E. O'Neil (42)
	Year of Election or Appointment: 2001 Vice President of VIP Asset Manager and VIP Asset Manager: Growth. Mr. O'Neil also serves as Vice President of other funds advised by FMR. Prior to assuming his current responsibilities, Mr. O'Neil managed a variety of Fidelity funds.
Stephen R. Petersen (48)
	Year of Election or Appointment: 1997 Vice President of VIP Equity-Income. Mr. Petersen serves as Vice President of other funds advised by FMR. Mr. Petersen also serves as Senior Vice President of FMR and FMR Co., Inc. (2001).
Jennifer S. Uhrig (43)
	Year of Election or Appointment: 1997 Vice President of VIP Growth Portfolio. Ms. Uhrig serves as Vice President of another fund advised by FMR. Ms. Uhrig also serves as Vice President of FMR and FMR Co., Inc. (2001).
Eric D. Roiter (56)
	Year of Election or Appointment: 1998 Secretary of VIP Asset Manager, VIP Contrafund, VIP Equity-Income, VIP Growth, VIP High Income, VIP Index 500, and VIP Overseas. He also serves as Secretary of other Fidelity funds; Vice President, General Counsel, and Secretary of FMR Co., Inc. (2001-present) and FMR; Vice President and Secretary of FDC; Assistant Secretary of Fidelity Management & Research (U.K.) Inc. (2001-present), Fidelity Management & Research (Far East) Inc. (2001-present); and Fidelity Investments Money Management, Inc. (2001-present). Mr. Roiter is an Adjunct Member, Faculty of Law, at Boston College Law School (2003).
Stuart Fross (45)
	Year of Election or Appointment: 2003 Assistant Secretary of VIP Asset Manager, VIP Contrafund, VIP Equity-Income, VIP Growth, VIP High Income, VIP Index 500, and VIP Overseas. Mr. Fross also serves as Assistant Secretary of other Fidelity funds (2003) and is an employee of FMR.
Christine Reynolds (46)
	Year of Election or Appointment: 2004 President, Treasurer, and Anti-Money Laundering (AML) officer of VIP Asset Manager, VIP Contrafund, VIP Equity-Income, VIP Growth, VIP High Income, VIP Index 500, and VIP Overseas. Ms. Reynolds also serves as President, Treasurer, and AML officer of other Fidelity funds (2004) and is a Vice President (2003) and an employee (2002) of FMR. Before joining Fidelity Investments, Ms. Reynolds worked at PricewaterhouseCoopers LLP (PwC) (1980-2002), where she was most recently an audit partner with PwC's investment management practice.
Timothy F. Hayes (54)
	Year of Election or Appointment: 2002 Chief Financial Officer of VIP Asset Manager, VIP Contrafund, VIP Equity-Income, VIP Growth, VIP High Income, VIP Index 500, and VIP Overseas. Mr. Hayes also serves as Chief Financial Officer of other Fidelity funds (2002). Recently he was appointed President of Fidelity Service Company (2003) where he also serves as a Director. Mr. Hayes also serves as President of Fidelity Investments Operations Group (FIOG, 2002), which includes Fidelity Pricing and Cash Management Services Group (FPCMS), where he was appointed President in 1998. Previously, Mr. Hayes served as Chief Financial Officer of Fidelity Investments Corporate Systems and Service Group (1998) and Fidelity Systems Company (1997-1998).
Kenneth A. Rathgeber (57)
	Year of Election or Appointment: 2004 Chief Compliance Officer of VIP Asset Manager, VIP Contrafund, VIP Equity-Income, VIP Growth, VIP High Income, VIP Index 500, and VIP Overseas. Mr. Rathgeber also serves as Chief Compliance Officer of other Fidelity funds (2004) and Executive Vice President of Risk Oversight for Fidelity Investments (2002). Previously, he served as Executive Vice President and Chief Operating Officer for Fidelity Investments Institutional Services Company, Inc. (1998-2002).
John R. Hebble (46)
	Year of Election or Appointment: 2003 Deputy Treasurer of VIP Asset Manager, VIP Contrafund, VIP Equity-Income, VIP Growth, VIP High Income, VIP Index 500, and VIP Overseas. Mr. Hebble also serves as Deputy Treasurer of other Fidelity funds (2003), and is an employee of FMR. Before joining Fidelity Investments, Mr. Hebble worked at Deutsche Asset Management where he served as Director of Fund Accounting (2002-2003) and Assistant Treasurer of the Scudder Funds (1998-2003).
Kimberley H. Monasterio (41)
	Year of Election or Appointment: 2004 Deputy Treasurer of VIP Asset Manager, VIP Contrafund, VIP Equity-Income, VIP Growth, VIP High Income, VIP Index 500, and VIP Overseas. Ms. Monasterio also serves as Deputy Treasurer of other Fidelity funds (2004) and is an employee of FMR (2004). Before joining Fidelity Investments, Ms. Monasterio served as Treasurer (2000-2004) and Chief Financial Officer (2002-2004) of the Franklin Templeton Funds and Senior Vice President of Franklin Templeton Services, LLC (2000-2004).
John H. Costello (58)
	Year of Election or Appointment: 1985, 1986, 1987, 1989, 1992, or 1995 Assistant Treasurer of VIP Asset Manager (1989), VIP Contrafund (1995), VIP Equity-Income (1986), VIP Growth (1986), VIP High Income (1985), VIP Index 500 (1992), and VIP Overseas (1987). Mr. Costello also serves as Assistant Treasurer of other Fidelity funds and is an employee of FMR.
Peter L. Lydecker (50)
	Year of Election or Appointment: 2004 Assistant Treasurer of VIP Asset Manager, VIP Contrafund, VIP Equity-Income, VIP Growth, VIP High Income, VIP Index 500, and VIP Overseas. Mr. Lydecker also serves as Assistant Treasurer of other Fidelity funds (2004) and is an employee of FMR.
Mark Osterheld (49)
	Year of Election or Appointment: 2002 Assistant Treasurer of VIP Asset Manager, VIP Contrafund, VIP Equity-Income, VIP Growth, VIP High Income, VIP Index 500, and VIP Overseas. Mr. Osterheld also serves as Assistant Treasurer of other Fidelity funds (2002) and is an employee of FMR.
Kenneth B. Robins (35)
	Year of Election or Appointment: 2004 Assistant Treasurer of VIP Asset Manager, VIP Contrafund, VIP Equity-Income, VIP Growth, VIP High Income, VIP Index 500, and VIP Overseas. Mr. Robins also serves as Assistant Treasurer of other Fidelity funds (2004) and is an employee of FMR (2004). Before joining Fidelity Investments, Mr. Robins worked at KPMG LLP, where he was a partner in KPMG's department of professional practice (2002-2004) and a Senior Manager (1999-2000). In addition, Mr. Robins served as Assistant Chief Accountant, United States Securities and Exchange Commission (2000-2002).

Annual Report

Distributions

The Board of Trustees of each fund voted to pay to shareholders of record at the opening of business on record date, the following distributions per share derived from capital gains realized from sales of portfolio securities, and dividends derived from net investment income:

Fund	Pay Date	Record Date	Dividends	Capital Gains
Equity-Income
Initial Class	02/14/05	02/11/05	$.405	$.890
Service Class	02/14/05	02/11/05	$.385	$.890
Service Class 2	02/14/05	02/11/05	$.360	$.890
Asset Manager
Initial Class	02/11/05	02/11/05	$.390	$.005
Service Class	02/11/05	02/11/05	$.370	$.005
Service Class 2	02/11/05	02/11/05	$.365	$.005
Contrafund
Initial Class	02/11/05	02/11/05	$.080	$.010
Serice Class	02/11/05	02/11/05	$.060	$.010
Service Class 2	02/11/05	02/11/05	$.040	$.010
Overseas
Initial Class	02/11/05	02/11/05	$.115	$.090
Service Class	02/11/05	02/11/05	$.100	$.090
Service Class 2	02/11/05	02/11/05	$.090	$.090

A percentage of the dividends distributed during the fiscal year for the following funds was derived from interest on U.S. Government securities which is generally exempt from state income tax:

Fund
Asset Manager	7.48%

A percentage of the dividends distributed during the fiscal year for the following funds qualifies for the dividends-received deduction for corporate shareholders:

Fund
Asset Manager
Initial Class	29%
Service Class	30%
Service Class 2	31%
Contrafund
Initial Class	100%
Service Class	100%
Service Class 2	100%
Equity-Income
Initial Class	100%
Service Class	100%
Service Class 2	100%
Growth
Initial Class	100%
Service Class	100%
Service Class 2	100%
Index 500
Initial Class	100%
Service Class	100%
Service Class 2	100%

Annual Report

Notes to Financial Statements - continued

The amounts per share which represent income derived from sources within, and taxes paid to, foreign countries or possessions of the United States are as follows:

Fund	Pay Date	Income	Taxes
Overseas
Initial Class	02/13/04	$.199	$.019
Service Class	02/13/04	$.189	$.019
Service Class 2	02/13/04	$.179	$.019

The funds will notify shareholders in January 2005 of amounts for use in preparing 2004 income tax returns.

Annual Report

Proxy Voting Results

A special meeting of the Variable Insurance Products Fund shareholders was held on December 14, 2004. The results of votes taken among shareholders on proposals before them are reported below. Each vote reported represents one dollar of net asset value held on the record date for the meeting.

PROPOSAL 1
To amend the Declaration of Trust to allow the Board of Trustees, if permitted by applicable law, to authorize fund mergers without shareholder approval. ^A
	# of Votes	% of Votes
Affirmative	15,331,508,529.96	81.853
Against	2,429,553,894.02	12.972
Abstain	969,378,618.94	5.175
TOTAL	18,730,441,042.92	100.000
PROPOSAL 2
To elect a Board of Trustees. ^A
	# of Votes	% of Votes
J. Michael Cook
Affirmative	17,770,642,454.98	94.876
Withheld	959,798,587.94	5.124
TOTAL	18,730,441,042.92	100.000
Ralph F. Cox
Affirmative	17,759,356,374.26	94.815
Withheld	971,084,668.66	5.185
TOTAL	18,730,441,042.92	100.000
Laura B. Cronin
Affirmative	17,797,888,742.24	95.021
Withheld	932,552,300.68	4.979
TOTAL	18,730,441,042.92	100.000
Dennis J. Dirks^B
Affirmative	17,802,602,074.45	95.046
Withheld	927,838,968.47	4.954
TOTAL	18,730,441,042.92	100.000
Robert M. Gates
Affirmative	17,784,855,823.58	94.952
Withheld	945,585,219.34	5.048
TOTAL	18,730,441,042.92	100.000
George H. Heilmeier
Affirmative	17,768,875,556.56	94.866
Withheld	961,565,486.36	5.134
TOTAL	18,730,441,042.92	100.000
Abigail P. Johnson
Affirmative	17,781,929,073.06	94.936
Withheld	948,511,969.86	5.064
TOTAL	18,730,441,042.92	100.000
Edward C. Johnson 3d
Affirmative	17,752,140,336.45	94.777
Withheld	978,300,706.47	5.223
TOTAL	18,730,441,042.92	100.000
Donald J. Kirk
Affirmative	17,772,467,361.45	94.885
Withheld	957,973,681.47	5.115
TOTAL	18,730,441,042.92	100.000
Marie L. Knowles
Affirmative	17,776,922,254.30	94.909
Withheld	953,518,788.62	5.091
TOTAL	18,730,441,042.92	100.000
Ned C. Lautenbach
Affirmative	17,804,221,564.95	95.055
Withheld	926,219,477.97	4.945
TOTAL	18,730,441,042.92	100.000
Marvin L. Mann
Affirmative	17,763,277,607.06	94.836
Withheld	967,163,435.86	5.164
TOTAL	18,730,441,042.92	100.000
William O. McCoy
Affirmative	17,758,560,162.11	94.811
Withheld	971,880,880.81	5.189
TOTAL	18,730,441,042.92	100.000
Robert L. Reynolds
Affirmative	17,806,026,904.06	95.065
Withheld	924,414,138.86	4.935
TOTAL	18,730,441,042.92	100.000
Cornelia M. Small^B
Affirmative	17,798,878,892.31	95.026
Withheld	931,562,150.61	4.974
TOTAL	18,730,441,042.92	100.000
William S. Stavropoulos
Affirmative	17,786,496,107.78	94.960
Withheld	943,944,935.14	5.040
TOTAL	18,730,441,042.92	100.000
PROPOSAL 3
To approve a new sub-advisory agreement among FMR, FMR U.K., and Variable Insurance Products Fund for each of Equity-Income Portfolio and Growth Portfolio.
Equity-Income Portfolio
	# of Votes	% of Votes
Affirmative	6,731,293,010.62	89.239
Against	310,929,859.15	4.122
Abstain	500,745,863.80	6.639
TOTAL	7,542,968,733.57	100.000
Growth Portfolio
	# of Votes	% of Votes
Affirmative	5,975,028,070.83	88.802
Against	315,998,524.66	4.696
Abstain	437,489,754.25	6.502
TOTAL	6,728,516,349.74	100.000
PROPOSAL 4
To approve a new sub-advisory agreement among FMR, FMR Far East, and Variable Insurance Products Fund for each of Equity-Income Portfolio and Growth Portfolio.
Equity-Income Portfolio
	# of Votes	% of Votes
Affirmative	6,721,558,010.15	89.110
Against	322,563,327.80	4.277
Abstain	498,847,395.62	6.613
TOTAL	7,542,968,733.57	100.000
Growth Portfolio
	# of Votes	% of Votes
Affirmative	5,967,060,487.85	88.683
Against	322,604,636.29	4.795
Abstain	438,851,225.60	6.522
TOTAL	6,728,516,349.74	100.000
PROPOSAL 5
To approve a new amended and restated sub-advisory agreement between FMR Far East and FIJ for each of Equity-Income Portfolio and Growth Portfolio.
Equity-Income Portfolio
	# of Votes	% of Votes
Affirmative	6,718,405,992.36	89.068
Against	323,955,769.99	4.295
Abstain	500,606,971.22	6.637
TOTAL	7,542,968,733.57	100.000
Growth Portfolio
	# of Votes	% of Votes
Affirmative	5,952,404,198.80	88.465
Against	333,946,456.42	4.963
Abstain	442,165,694.52	6.572
TOTAL	6,728,516,349.74	100.000
PROPOSAL 6
To approve a new master international research agreement between FMR and FIIA for each of Equity-Income Portfolio and Growth Portfolio.
Equity-Income Portfolio
	# of Votes	% of Votes
Affirmative	6,734,087,467.07	89.276
Against	307,013,886.12	4.071
Abstain	501,867,380.38	6.653
TOTAL	7,542,968,733.57	100.000
Growth Portfolio
	# of Votes	% of Votes
Affirmative	5,970,554,038.68	88.735
Against	321,092,817.96	4.772
Abstain	436,869,493.10	6.493
TOTAL	6,728,516,349.74	100.000
PROPOSAL 7
To approve a new sub-research agreement between FIIA and FIIA (U.K.)L for each of Equity-Income Portfolio and Growth Portfolio.
Equity-Income Portfolio
	# of Votes	% of Votes
Affirmative	6,731,737,757.05	89.245
Against	311,103,851.74	4.125
Abstain	500,127,124.78	6.630
TOTAL	7,542,968,733.57	100.000
Growth Portfolio
	# of Votes	% of Votes
Affirmative	5,968,891,984.81	88.710
Against	319,296,673.74	4.746
Abstain	440,327,691.19	6.544
TOTAL	6,728,516,349.74	100.000
PROPOSAL 8
To approve a new sub-research agreement between FIIA and FIJ for each of Equity-Income Portfolio and Growth Portfolio.
Equity-Income Portfolio
	# of Votes	% of Votes
Affirmative	6,739,563,050.41	89.349
Against	309,142,220.41	4.098
Abstain	494,263,462.75	6.553
TOTAL	7,542,968,733.57	100.000
Growth Portfolio
	# of Votes	% of Votes
Affirmative	5,979,761,945.37	88.872
Against	322,291,647.58	4.790
Abstain	426,462,756.79	6.338
TOTAL	6,728,516,349.74	100.000
PROPOSAL 9
To amend the fundamental investment limitation concerning borrowing for each of Equity-Income Portfolio, Growth Portfolio, High Income Portfolio and Overseas Portfolio.
Equity-Income Portfolio
	# of Votes	% of Votes
Affirmative	6,685,392,791.57	88.631
Against	416,380,211.81	5.520
Abstain	441,195,730.19	5.849
TOTAL	7,542,968,733.57	100.000
Growth Portfolio
	# of Votes	% of Votes
Affirmative	5,946,204,016.89	88.373
Against	412,358,112.36	6.129
Abstain	369,954,220.49	5.498
TOTAL	6,728,516,349.74	100.000
High Income Portfolio
	# of Votes	% of Votes
Affirmative	1,451,356,817.10	90.478
Against	59,751,642.97	3.725
Abstain	92,989,319.11	5.797
TOTAL	1,604,097,779.18	100.000
Overseas Portfolio
	# of Votes	% of Votes
Affirmative	1,415,911,097.88	89.754
Against	58,404,622.92	3.702
Abstain	103,230,926.39	6.544
TOTAL	1,577,546,647.19	100.000
PROPOSAL 10
To amend the fundamental investment limitation concerning lending for each of Equity-Income Portfolio, Growth Portfolio, High Income Portfolio and Overseas Portfolio.
Equity-Income Portfolio
	# of Votes	% of Votes
Affirmative	6,589,639,425.26	87.361
Against	465,151,442.69	6.167
Abstain	488,177,865.62	6.472
TOTAL	7,542,968,733.57	100.000
Growth Portfolio
	# of Votes	% of Votes
Affirmative	5,843,159,022.83	86.842
Against	468,598,250.73	6.964
Abstain	416,759,076.18	6.194
TOTAL	6,728,516,349.74	100.000
High Income Portfolio
	# of Votes	% of Votes
Affirmative	1,453,764,730.70	90.628
Against	57,576,166.97	3.590
Abstain	92,756,881.51	5.782
TOTAL	1,604,097,779.18	100.000
Overseas Portfolio
	# of Votes	% of Votes
Affirmative	1,415,760,262.71	89.744
Against	59,625,618.33	3.780
Abstain	102,160,766.15	6.476
TOTAL	1,577,546,647.19	100.000
^A Denotes trust-wide proposals and voting results. ^B Effective January 1, 2005.

Annual Report

Proxy Voting Results

A special meeting of the Variable Insurance Products Fund II shareholders was held on December 14, 2004. The results of votes taken among shareholders on proposals before them are reported below. Each vote reported represents one dollar of net asset value held on the record date for the meeting.

PROPOSAL 1
To amend the Declaration of Trust to allow the Board of Trustees, if permitted by applicable law, to authorize fund mergers without shareholder approval. ^A
	# of Votes	% of Votes
Affirmative	10,633,156,497.88	78.949
Against	2,079,333,933.24	15.439
Abstain	755,879,753.86	5.612
TOTAL	13,468,370,184.98	100.000
PROPOSAL 2
To elect a Board of Trustees. ^A
	# of Votes	% of Votes
J. Michael Cook
Affirmative	12,653,134,619.02	93.947
Withheld	815,235,565.96	6.053
TOTAL	13,468,370,184.98	100.000
Ralph F. Cox
Affirmative	12,621,475,328.63	93.712
Withheld	846,894,856.35	6.288
TOTAL	13,468,370,184.98	100.000
Laura B. Cronin
Affirmative	12,672,564,623.97	94.091
Withheld	795,805,561.01	5.909
TOTAL	13,468,370,184.98	100.000
Dennis J. Dirks ^B
Affirmative	100,000,000.00	00.000
Withheld	100,000,000.00	00.000
TOTAL	13,468,370,184.98	100.000
Robert M. Gates
Affirmative	12,659,421,698.29	93.994
Withheld	808,948,486.69	6.006
TOTAL	13,468,370,184.98	100.000
George H. Heilmeier
Affirmative	12,643,445,665.25	93.875
Withheld	824,924,519.73	6.125
TOTAL	13,468,370,184.98	100.000
Abigail P. Johnson
Affirmative	12,656,994,867.39	93.976
Withheld	811,375,317.59	6.024
TOTAL	13,468,370,184.98	100.000
Edward C. Johnson 3d
Affirmative	12,611,555,734.60	93.638
Withheld	856,814,450.38	6.362
TOTAL	13,468,370,184.98	100.000
Donald J. Kirk
Affirmative	12,632,695,111.23	93.795
Withheld	835,675,073.75	6.205
TOTAL	13,468,370,184.98	100.000
Marie L. Knowles
Affirmative	12,674,914,386.54	94.109
Withheld	793,455,798.44	5.891
TOTAL	13,468,370,184.98	100.000
Ned C. Lautenbach
Affirmative	12,679,654,480.45	94.144
Withheld	788,715,704.53	5.856
TOTAL	13,468,370,184.98	100.000
Marvin L. Mann
Affirmative	12,631,864,234.33	93.789
Withheld	836,505,950.65	6.211
TOTAL	13,468,370,184.98	100.000
William O. McCoy
Affirmative	12,627,373,668.93	93.756
Withheld	840,996,516.05	6.244
TOTAL	13,468,370,184.98	100.000
Robert L. Reynolds
Affirmative	12,676,011,492.18	94.117
Withheld	792,358,692.80	5.883
TOTAL	13,468,370,184.98	100.000
Cornelia M. Small ^B
Affirmative	12,673,927,441.76	94.101
Withheld	794,442,743.22	5.899
TOTAL	13,468,370,184.98	100.000
William S. Stavropoulos
Affirmative	12,650,527,834.35	93.928
Withheld	817,842,350.63	6.072
TOTAL	13,468,370,184.98	100.000
PROPOSAL 3
To amend the fundamental investment limitation concerning lending for each of Asset Manager Portfolio, Contrafund Portfolio and Index 500 Portfolio.
Asset Manager Portfolio
	# of Votes	% of Votes
Affirmative	1,849,622,102.61	80.210
Against	253,772,754.95	11.005
Abstain	202,575,618.72	8.785
TOTAL	2,305,970,476.28	100.000
Contrafund Portfolio
	# of Votes	% of Votes
Affirmative	5,886,227,662.54	79.495
Against	936,831,415.64	12.652
Abstain	581,452,493.19	7.853
TOTAL	7,404,511,571.37	100.000
Index 500 Portfolio
	# of Votes	% of Votes
Affirmative	1,626,622,004.43	80.121
Against	236,642,441.54	11.656
Abstain	166,939,389.09	8.223
TOTAL	2,030,203,835.06	100.000
^A Denotes trust-wide proposals and voting results. ^B Effective January 1, 2005.

Annual Report

Investment Adviser

Fidelity Management & Research Company
Boston, MA

Investment Sub-Advisers

FMR Co., Inc.
Asset Manager, Contrafund, Equity-Income, Growth,
High Income, Index 500, and Overseas Portfolios

Fidelity Investments Money Management, Inc.
Asset Manager Portfolio

Fidelity Management & Research (U.K.) Inc.
Asset Manager, Contrafund, Equity-Income,
Growth, High Income, and Overseas Portfolios

Fidelity Management & Research (Far East) Inc.
Asset Manager, Contrafund, Equity-Income,
Growth, High Income, and Overseas Portfolios

Fidelity International Investment Advisors
Asset Manager, Contrafund, Equity-Income,
Growth, High Income, and Overseas Portfolios

Fidelity International Investment Advisors (U.K.) Limited
Asset Manager, Contrafund, Equity-Income,
Growth, High Income, and Overseas Portfolios

Fidelity Investments Japan Limited
Asset Manager, Contrafund, Equity-Income,
Growth, High Income, and Overseas Portfolios

Geode Capital Management, LLC
Index 500 Portfolio

General Distributor

Fidelity Distributors Corporation
Boston, MA

Transfer and Shareholder Servicing Agent

Fidelity Investments Institutional Operations Company, Inc.
Boston, MA

Custodian

The Bank of New York, New York, NY
High Income Portfolio

JPMorgan Chase Bank, New York, NY
Asset Manager and Overseas Portfolios

Brown Brothers Harriman & Co., Boston, MA
Contrafund Portfolio

Mellon Bank, N.A., Pittsburgh, PA
Growth and Index 500 Portfolios

The Northern Trust Company, Chicago, IL
Equity-Income Portfolios

VIPGRP1-ANN-0205
1.768592.103

Fidelity® Variable Insurance Products

Asset Manager: Growth® Portfolio

Balanced Portfolio

Growth & Income Portfolio

Growth Opportunities Portfolio

Investment Grade Bond Portfolio

Mid Cap Portfolio

Money Market Portfolio

Annual Report

December 31, 2004

(2_fidelity_logos) (Registered_Trademark)

Shareholder Expense Example	4	An example of shareholder expenses
Asset Manager: Growth Portfolio	7 8 9 10 20	Performance Management's Discussion Investment Summary Investments Financial Statements
Balanced Portfolio	24 25 26 27 41	Performance Management's Discussion Investment Summary Investments Financial Statements
Growth & Income Portfolio	45 46 47 48 50	Performance Management's Discussion Investment Summary Investments Financial Statements
Growth Opportunities Portfolio	54 55 56 57 60	Performance Management's Discussion Investment Summary Investments Financial Statements
Investment Grade Bond Portfolio	64 65 66 67 76	Performance Management's Discussion Investment Summary Investments Financial Statements
Mid Cap Portfolio	80 81 82 83 95	Performance Management's Discussion Investment Summary Investments Financial Statements
Money Market Portfolio	99 100 101 105	Performance Investment Summary Investments Financial Statements
Notes to Financial Statements	109	Notes to the Financial Statements
Report of Independent Registered Public Accounting Firm	116
Central Investment Portfolio Top Fifty Holdings	120	Top Fifty holdings of each Fidelity Central Investment Portfolio held by certain funds
Trustees and Officers	122
Distributions	128
Proxy Voting Results	129

Fidelity Variable Insurance Products are separate account options which are purchased through a variable insurance contract.

Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.

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 Corp. or an affiliated company.

(Recycle graphic) This report is printed on recycled paper using soy-based inks.

NOT FDIC INSURED · MAY LOSE VALUE · NO BANK GUARANTEE

Neither the funds nor Fidelity Distributors Corporation is a bank.

Annual Report

Shareholder Expense Example

As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (July 1, 2004 to December 31, 2004).

Actual Expenses

The first line of the table below for each class of each fund provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line for a class of the fund under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. The estimate of expenses does not include any fees or other expenses of any variable annuity or variable life insurance product. If they were, the estimate of expenses you paid during the period would be higher, and your ending account value would be lower.

Hypothetical Example for Comparison Purposes

The second line of the table below for each class of each fund provides information about hypothetical account values and hypothetical expenses based on a Class' actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Class' actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. The estimate of expenses does not include any fees or other expenses of any variable annuity or variable life insurance product. If they were, the estimate of expenses you paid during the period would be higher, and your ending account value would be lower.

	Beginning Account Value July 1, 2004	Ending Account Value December 31, 2004	Expenses Paid During Period* July 1, 2004 to December 31, 2004
Asset Manager: Growth
Initial Class
Actual	$ 1,000.00	$ 1,045.00	$ 3.91
Hypothetical ^A	$ 1,000.00	$ 1,021.32	$ 3.86
Service Class
Actual	$ 1,000.00	$ 1,044.40	$ 4.57
Hypothetical ^A	$ 1,000.00	$ 1,020.66	$ 4.52
Service Class 2
Actual	$ 1,000.00	$ 1,043.00	$ 5.44
Hypothetical ^A	$ 1,000.00	$ 1,019.81	$ 5.38
Balanced
Initial Class
Actual	$ 1,000.00	$ 1,055.10	$ 2.94
Hypothetical ^A	$ 1,000.00	$ 1,022.27	$ 2.90
Service Class
Actual	$ 1,000.00	$ 1,054.70	$ 3.51
Hypothetical ^A	$ 1,000.00	$ 1,021.72	$ 3.46
Service Class 2
Actual	$ 1,000.00	$ 1,052.60	$ 4.28
Hypothetical ^A	$ 1,000.00	$ 1,020.96	$ 4.22
Growth & Income
Initial Class
Actual	$ 1,000.00	$ 1,058.60	$ 3.21
Hypothetical ^A	$ 1,000.00	$ 1,022.02	$ 3.15
Service Class
Actual	$ 1,000.00	$ 1,059.00	$ 3.73
Hypothetical ^A	$ 1,000.00	$ 1,021.52	$ 3.66
Service Class 2
Actual	$ 1,000.00	$ 1,057.90	$ 4.50
Hypothetical ^A	$ 1,000.00	$ 1,020.76	$ 4.42
	Beginning Account Value July 1, 2004	Ending Account Value December 31, 2004	Expenses Paid During Period* July 1, 2004 to December 31, 2004
Growth Opportunities
Initial Class
Actual	$ 1,000.00	$ 1,056.50	$ 3.83
Hypothetical ^A	$ 1,000.00	$ 1,021.42	$ 3.76
Service Class
Actual	$ 1,000.00	$ 1,055.90	$ 4.34
Hypothetical ^A	$ 1,000.00	$ 1,020.91	$ 4.27
Service Class 2
Actual	$ 1,000.00	$ 1,054.90	$ 5.17
Hypothetical ^A	$ 1,000.00	$ 1,020.11	$ 5.08
Investment Grade Bond
Initial Class
Actual	$ 1,000.00	$ 1,044.10	$ 2.88
Hypothetical ^A	$ 1,000.00	$ 1,022.32	$ 2.85
Service Class
Actual	$ 1,000.00	$ 1,042.70	$ 3.39
Hypothetical ^A	$ 1,000.00	$ 1,021.82	$ 3.35
Service Class 2
Actual	$ 1,000.00	$ 1,042.20	$ 4.16
Hypothetical ^A	$ 1,000.00	$ 1,021.06	$ 4.12
Mid Cap
Initial Class
Actual	$ 1,000.00	$ 1,176.60	$ 3.94
Hypothetical ^A	$ 1,000.00	$ 1,021.52	$ 3.66
Service Class
Actual	$ 1,000.00	$ 1,175.50	$ 4.48
Hypothetical ^A	$ 1,000.00	$ 1,021.01	$ 4.17
Service Class 2
Actual	$ 1,000.00	$ 1,175.00	$ 5.30
Hypothetical ^A	$ 1,000.00	$ 1,020.26	$ 4.93
Money Market
Initial Class
Actual	$ 1,000.00	$ 1,007.40	$ 1.46
Hypothetical ^A	$ 1,000.00	$ 1,023.68	$ 1.48
Service Class
Actual	$ 1,000.00	$ 1,006.80	$ 2.02
Hypothetical ^A	$ 1,000.00	$ 1,023.13	$ 2.03
Service Class 2
Actual	$ 1,000.00	$ 1,006.10	$ 2.77
Hypothetical ^A	$ 1,000.00	$ 1,022.37	$ 2.80

^A5% return per year before expenses

	Annualized Expense Ratio
Asset Manager: Growth
Initial Class	.76%
Service Class	.89%
Service Class 2	1.06%
Balanced
Initial Class	.57%
Service Class	.68%
Service Class 2	.83%
	Annualized Expense Ratio
Growth & Income
Initial Class	.62%
Service Class	.72%
Service Class 2	.87%
Growth Opportunities
Initial Class	.74%
Service Class	.84%
Service Class 2	1.00%
Investment Grade Bond
Initial Class	.56%
Service Class	.66%
Service Class 2	.81%
Mid Cap
Initial Class	.72%
Service Class	.82%
Service Class 2	.97%
Money Market
Initial Class	.29%
Service Class	.40%
Service Class 2	.55%

Annual Report

Fidelity Variable Insurance Products: Asset Manager: Growth Portfolio

Performance: The Bottom Line

Average annual total return reflects the change in the value of an investment, assuming reinvestment of the class' dividend income and capital gains (the profits earned upon the sale of securities that have grown in value) and assuming a constant rate of performance each year. During periods of reimbursement by Fidelity, a fund's total return will be greater than it would be had the reimbursement not occurred. Performance numbers are net of all underlying fund operating expenses, but do not include any insurance charges imposed by your insurance company's separate account. If performance information included the effect of these additional charges, the total returns would be lower. How a fund did yesterday is no guarantee of how it will do tomorrow.

Average Annual Total Returns

Periods ended December 31, 2004	Past 1 year	Past 5 years	Life of fund ^A
Fidelity VIP: Asset Mgr: Growth - Initial Class	5.98%	-2.19%	8.40%
Fidelity VIP: Asset Mgr: Growth - Service Class ^B	5.85%	-2.30%	8.28%
Fidelity VIP: Asset Mgr: Growth - Service Class 2 ^C	5.63%	-2.48%	8.19%

^A From January 3, 1995

^BThe initial offering of Service Class shares took place on November 3, 1997. Performance for Service Class shares reflects an asset-based service fee (12b-1 fee), and returns prior to November 3, 1997 are those of Initial Class and do not include the effects of Service Class' 12b-1 fee. Had Service Class shares' 12b-1 fee been reflected, returns prior to November 3, 1997 would have been lower.

^CThe initial offering of Service Class 2 shares took place on January 12, 2000. Performance for Service Class 2 shares reflects an asset-based service fee (12b-1 fee). Returns from November 3, 1997 to January 12, 2000 are those of Service Class which reflect a different 12b-1 fee. Service Class 2 returns prior to November 3, 1997 are those of Initial Class and do not include the effects of a 12b-1 fee. Had Service Class 2's 12b-1 fee been reflected, returns prior to January 12, 2000 would have been lower.

$10,000 Over Life of Fund

Let's say hypothetically that $10,000 was invested in Fidelity® Variable Insurance Products: Asset Manager: Growth Portfolio - Initial Class on January 3, 1995. The chart shows how the value of your investment would have changed, and also shows how the S&P 500® Index performed over the same period.

Annual Report

Fidelity Variable Insurance Products: Asset Manager: Growth Portfolio

Management's Discussion of Fund Performance

Comments from Richard Habermann and Ford O'Neil, Co-Managers of Fidelity® Variable Insurance Products: Asset Manager: Growth Portfolio

During the past year, the fund trailed both the Fidelity Asset Manager: Growth Composite Index and the Lipper^SM Variable Annuity Flexible Portfolio Funds Average, which returned 8.79% and 8.25%, respectively. Disappointing stock selection was simply too much to overcome even in the face of favorable asset allocation and solid results within the fixed-income subportfolio. In an environment that favored riskier assets, the fund was rewarded relative to the index for overweighting stocks and high-yield bonds, both of which outperformed investment-grade debt. The fund's domestic equity investments trailed the S&P 500® by more than four percentage points, largely due to one major holding in media - radio broadcaster Clear Channel Communications - that stumbled badly. Unfavorable stock selection in financials and health care also hurt, led by insurance giant American International Group and large-cap pharmaceutical company Pfizer, respectively. Conversely, underweighting weak technology stocks helped, as did overweighting retailers Home Depot and pharmacy chain CVS, and energy holdings such as Diamond Offshore Drilling. In fixed income, our high-yield and investment-grade holdings easily beat the Lehman Brothers Aggregate Bond Index. The strategic cash portion of the fund topped its benchmark as well, though overweighting it curbed the fund's gains in a rising bond market.

Asset Manager: Growth Portfolio

Fidelity Variable Insurance Products: Asset Manager: Growth Portfolio

Investment Summary

Top Five Stocks as of December 31, 2004
	% of fund's net assets
American International Group, Inc.	3.6
Home Depot, Inc.	3.6
Cardinal Health, Inc.	3.5
Microsoft Corp.	3.3
Fannie Mae	2.9
	16.9
Top Five Market Sectors as of December 31, 2004
(stocks only)	% of fund's net assets
Financials	18.9
Health Care	12.4
Information Technology	11.1
Consumer Discretionary	8.3
Industrials	5.9

Asset Allocation as of December 31, 2004
% of fund's net assets*
	Stock class and Equity Futures	75.7%
	Bond class	14.4%
	Short-term class	9.9%

* Foreign investments

10.5%

Asset allocations in the pie chart reflect the categorization of assets as defined in the fund's prospectus in effect as of the time periods indicated above. Financial Statement categorizations conform to accounting standards and will differ from the pie chart. Percentages are adjusted for the effect of futures contracts and swap contracts, if applicable.

The information in the above table is based on the combined investments of the fund and its pro-rata share of the investments of Fidelity's fixed-income central funds.

Annual Report

Fidelity Variable Insurance Products: Asset Manager: Growth Portfolio

Investments December 31, 2004

Showing Percentage of Net Assets

Common Stocks - 72.3%
	Shares		Value (Note 1)
CONSUMER DISCRETIONARY - 8.3%
Auto Components - 0.1%
Aisin Seiki Co. Ltd.	5,700		$ 144,406
Exide Technologies warrants 3/18/06 (a)	5		0
			144,406
Automobiles - 0.1%
Honda Motor Co. Ltd.	4,300		224,116
Distributors - 0.0%
Li & Fung Ltd.	80,000		134,829
Hotels, Restaurants & Leisure - 0.4%
Enterprise Inns PLC	10,300		157,141
Kerzner International Ltd. (a)	2,900		174,145
McDonald's Corp.	27,200		872,032
			1,203,318
Household Durables - 0.2%
Techtronic Industries Co. Ltd.	188,500		411,058
Thomson SA	9,800		258,572
			669,630
Leisure Equipment & Products - 0.1%
Aruze Corp.	2,000		50,962
Fuji Photo Film Co. Ltd.	8,100		299,538
			350,500
Media - 3.4%
Antena 3 Television SA (a)	1,100		79,311
Clear Channel Communications, Inc.	246,700		8,261,983
Dow Jones & Co., Inc.	2,920		125,735
News Corp. Class A	76,400		1,425,624
SKY Perfect Communications, Inc.	99		107,283
Taylor Nelson Sofres PLC	34,500		149,628
Time Warner, Inc. (a)	33,100		643,464
Tv Asahi Corp.	71		144,177
			10,937,205
Specialty Retail - 3.9%
Fast Retailing Co. Ltd.	2,300		175,144
Hennes & Mauritz AB (H&M) (B Shares)	7,750		269,964
Home Depot, Inc.	265,700		11,356,018
Ross Stores, Inc.	4,300		124,141
Staples, Inc.	4,800		161,808
TJX Companies, Inc.	15,700		394,541
			12,481,616
Textiles, Apparel & Luxury Goods - 0.1%
The Swatch Group AG (Reg.)	11,296		335,078
TOTAL CONSUMER DISCRETIONARY			26,480,698

	Shares		Value (Note 1)
CONSUMER STAPLES - 5.5%
Beverages - 0.5%
PepsiCo, Inc.	19,100		$ 997,020
Pernod-Ricard	3,500		535,091
			1,532,111
Food & Staples Retailing - 2.9%
CVS Corp.	106,600		4,804,462
Safeway, Inc. (a)	90,200		1,780,548
Wal-Mart Stores, Inc.	52,800		2,788,896
			9,373,906
Food Products - 0.0%
People's Food Holdings Ltd.	201,000		184,731
Household Products - 0.3%
Colgate-Palmolive Co.	9,400		480,904
Kimberly-Clark Corp.	1,000		65,810
Procter & Gamble Co.	6,300		347,004
			893,718
Personal Products - 0.8%
Alberto-Culver Co.	46,500		2,258,505
Estee Lauder Companies, Inc. Class A	3,600		164,772
			2,423,277
Tobacco - 1.0%
Altria Group, Inc.	50,600		3,091,660
TOTAL CONSUMER STAPLES			17,499,403
ENERGY - 3.4%
Energy Equipment & Services - 2.2%
Diamond Offshore Drilling, Inc. (d)	47,400		1,898,370
ENSCO International, Inc.	33,600		1,066,464
GlobalSantaFe Corp.	47,900		1,585,969
Nabors Industries Ltd. (a)	4,800		246,192
Technip-Coflexip SA	1,300		239,838
Transocean, Inc. (a)	44,900		1,903,311
			6,940,144
Oil & Gas - 1.2%
Canadian Natural Resources Ltd.	7,300		311,771
ChevronTexaco Corp.	6,000		315,060
ConocoPhillips	18,600		1,615,038
EnCana Corp.	6,800		387,600
ENI Spa	12,600		317,117
Exxon Mobil Corp.	6,200		317,812
Total SA Series B	2,370		520,642
			3,785,040
TOTAL ENERGY			10,725,184
FINANCIALS - 18.9%
Capital Markets - 2.8%
Credit Suisse Group (Reg.)	9,448		398,611
Goldman Sachs Group, Inc.	17,500		1,820,700
Common Stocks - continued
	Shares		Value (Note 1)
FINANCIALS - continued
Capital Markets - continued
JAFCO Co. Ltd.	3,500		$ 237,821
Julius Baer Holding AG (Bearer)	455		136,666
Lehman Brothers Holdings, Inc.	6,900		603,612
Man Group PLC	8,000		225,987
Matsui Securities Co. Ltd.	3,500		121,986
Merrill Lynch & Co., Inc.	39,800		2,378,846
Morgan Stanley	38,900		2,159,728
Nomura Holdings, Inc.	17,000		247,520
UBS AG (Reg.)	8,509		713,395
			9,044,872
Commercial Banks - 3.7%
Banca Intesa Spa	57,800		277,566
Bank of America Corp.	126,228		5,931,454
HSBC Holdings PLC (United Kingdom) (Reg.)	20,900		355,885
Mitsui Trust Holdings, Inc.	15,000		149,956
Mizuho Financial Group, Inc.	76		382,857
North Fork Bancorp, Inc., New York	11,670		336,680
Societe Generale Series A	4,000		403,981
Sumitomo Mitsui Financial Group, Inc.	63		458,215
Synovus Financial Corp.	22,800		651,624
Wachovia Corp.	39,340		2,069,289
Wells Fargo & Co.	10,500		652,575
			11,670,082
Consumer Finance - 0.4%
MBNA Corp.	41,200		1,161,428
SFCG Co. Ltd.	810		204,813
			1,366,241
Diversified Financial Services - 2.1%
Citigroup, Inc.	98,200		4,731,276
ING Groep NV (Certificaten Van Aandelen)	9,900		299,475
J.P. Morgan Chase & Co.	41,380		1,614,234
			6,644,985
Insurance - 6.2%
ACE Ltd.	17,100		731,025
AFLAC, Inc.	4,800		191,232
Allianz AG (Reg.)	1,500		199,350
AMBAC Financial Group, Inc.	14,100		1,158,033
American International Group, Inc.	175,500		11,525,083
Hartford Financial Services Group, Inc.	39,800		2,758,538
MBIA, Inc.	14,500		917,560
MetLife, Inc.	29,400		1,190,994
PartnerRe Ltd.	5,500		340,670
Prudential Financial, Inc.	11,000		604,560
			19,617,045
Thrifts & Mortgage Finance - 3.7%
Fannie Mae	128,300		9,136,243
MGIC Investment Corp.	19,000		1,309,290

	Shares		Value (Note 1)
New York Community Bancorp, Inc.	29,733		$ 611,608
Sovereign Bancorp, Inc.	300		6,765
Washington Mutual, Inc.	19,500		824,460
			11,888,366
TOTAL FINANCIALS			60,231,591
HEALTH CARE - 12.4%
Biotechnology - 0.5%
Actelion Ltd. (Reg.) (a)	6,153		630,717
CSL Ltd.	21,942		502,147
Global Bio-Chem Technology Group Co. Ltd.	222,000		145,662
QIAGEN NV (a)	15,600		170,820
			1,449,346
Health Care Equipment & Supplies - 0.3%
Baxter International, Inc.	21,700		749,518
Medtronic, Inc.	6,100		302,987
Thermo Electron Corp. (a)	300		9,057
			1,061,562
Health Care Providers & Services - 3.7%
Cardinal Health, Inc.	193,050		11,225,858
Henry Schein, Inc. (a)	4,200		292,488
Service Corp. International (SCI) (a)	15,898		118,440
UnitedHealth Group, Inc.	2,500		220,075
			11,856,861
Pharmaceuticals - 7.9%
Barr Pharmaceuticals, Inc. (a)	3,300		150,282
Johnson & Johnson	59,900		3,798,858
Merck & Co., Inc.	34,300		1,102,402
Novartis AG (Reg.)	7,274		367,628
Novo Nordisk AS Series B	9,000		490,826
Pfizer, Inc.	322,100		8,661,269
Roche Holding AG (participation certificate)	3,412		389,874
Schering-Plough Corp.	56,553		1,180,827
Shire Pharmaceuticals Group PLC	21,300		226,845
Wyeth	207,100		8,820,389
			25,189,200
TOTAL HEALTH CARE			39,556,969
INDUSTRIALS - 5.9%
Aerospace & Defense - 0.8%
BAE Systems PLC	25,300		111,912
Lockheed Martin Corp.	12,600		699,930
Northrop Grumman Corp.	9,400		510,984
United Technologies Corp.	10,200		1,054,170
			2,376,996
Air Freight & Logistics - 0.0%
Ryder System, Inc.	2,500		119,425
Common Stocks - continued
	Shares		Value (Note 1)
INDUSTRIALS - continued
Airlines - 0.1%
British Airways PLC (a)	56,300		$ 253,900
Commercial Services & Supplies - 0.3%
Aramark Corp. Class B	9,900		262,449
Capita Group PLC	22,600		158,628
ChoicePoint, Inc. (a)	14,300		657,657
			1,078,734
Electrical Equipment - 0.2%
ABB Ltd. (Reg.) (a)	57,603		321,014
Johnson Electric Holdings Ltd.	161,000		156,385
			477,399
Industrial Conglomerates - 3.7%
General Electric Co.	212,980		7,773,770
Siemens AG (Reg.)	5,800		491,086
Tyco International Ltd.	97,900		3,498,946
			11,763,802
Machinery - 0.6%
Ingersoll-Rand Co. Ltd. Class A	20,600		1,654,180
Invensys PLC (a)	646,100		192,184
Weichai Power Co. Ltd. (H Shares)	21,000		58,222
			1,904,586
Marine - 0.0%
Alexander & Baldwin, Inc.	1,300		55,146
Road & Rail - 0.2%
CSX Corp.	6,700		268,536
Union Pacific Corp.	3,800		255,550
			524,086
Transportation Infrastructure - 0.0%
China Merchants Holdings International Co. Ltd.	74,000		139,474
TOTAL INDUSTRIALS			18,693,548
INFORMATION TECHNOLOGY - 11.1%
Communications Equipment - 2.1%
Alcatel SA (RFD) (a)	60,200		940,926
Cisco Systems, Inc. (a)	189,402		3,655,459
Comverse Technology, Inc. (a)	20,900		511,005
Lucent Technologies, Inc. warrants 12/10/07 (a)	13,478		21,295
Motorola, Inc.	86,220		1,482,984
			6,611,669
Computers & Peripherals - 1.7%
ASUSTeK Computer, Inc.	47,000		124,929
Dell, Inc. (a)	75,500		3,181,570
Diebold, Inc.	6,600		367,818
Hewlett-Packard Co.	70,700		1,482,579
Solomon Systech Ltd.	192,000		47,427
Sun Microsystems, Inc. (a)	27,700		149,026
			5,353,349

	Shares		Value (Note 1)
Electronic Equipment & Instruments - 0.8%
Flextronics International Ltd. (a)	34,300		$ 474,026
Hon Hai Precision Industries Co. Ltd.	43,000		198,836
Hoya Corp.	1,700		192,024
Jabil Circuit, Inc. (a)	19,500		498,810
Optimax Technology Corp.	41,000		104,467
Sanmina-SCI Corp. (a)	36,400		308,308
Solectron Corp. (a)	126,900		676,377
Yageo Corp. (a)	308,000		110,450
			2,563,298
Internet Software & Services - 0.1%
Softbank Corp.	5,300		258,196
IT Services - 0.5%
Affiliated Computer Services, Inc. Class A (a)	12,100		728,299
First Data Corp.	24,600		1,046,484
			1,774,783
Semiconductors & Semiconductor Equipment - 2.2%
Analog Devices, Inc.	3,400		125,528
Applied Materials, Inc. (a)	35,900		613,890
ASML Holding NV (a)	16,100		256,151
ASML Holding NV (NY Shares) (a)	48,200		766,862
Freescale Semiconductor, Inc. Class B	9,630		176,807
Intel Corp.	140,800		3,293,312
KLA-Tencor Corp. (a)	9,400		437,852
Lam Research Corp. (a)	12,500		361,375
Linear Technology Corp.	3,100		120,156
Novellus Systems, Inc. (a)	7,900		220,331
Taiwan Semiconductor Manufacturing Co. Ltd. sponsored ADR	43,905		372,753
United Microelectronics Corp. sponsored ADR (d)	82,448		291,041
Xilinx, Inc.	2,100		62,265
			7,098,323
Software - 3.7%
BEA Systems, Inc. (a)	59,400		526,284
Computer Associates International, Inc.	1,065		33,079
Microsoft Corp.	394,775		10,544,440
VERITAS Software Corp. (a)	20,800		593,840
			11,697,643
TOTAL INFORMATION TECHNOLOGY			35,357,261
MATERIALS - 0.9%
Chemicals - 0.1%
Praxair, Inc.	6,600		291,390
Construction Materials - 0.1%
HeidelbergCement AG	6,746		405,402
Metals & Mining - 0.3%
Alcan, Inc.	16,500		808,500
BHP Billiton PLC	17,500		205,027
			1,013,527
Common Stocks - continued
	Shares		Value (Note 1)
MATERIALS - continued
Paper & Forest Products - 0.4%
Aracruz Celulose SA sponsored ADR	16,500		$ 622,050
Bowater, Inc.	4,100		180,277
International Paper Co.	3,200		134,400
Votorantim Celulose e Papel SA sponsored ADR (non-vtg.)	16,500		267,300
			1,204,027
TOTAL MATERIALS			2,914,346
TELECOMMUNICATION SERVICES - 5.3%
Diversified Telecommunication Services - 4.8%
BellSouth Corp.	61,700		1,714,643
Deutsche Telekom AG (Reg.) (a)	25,400		576,072
e.Biscom Spa (a)	900		51,839
Qwest Communications International, Inc. (a)	310,400		1,378,176
SBC Communications, Inc.	344,900		8,888,073
Telefonica SA	14,600		274,967
Verizon Communications, Inc.	55,300		2,240,203
			15,123,973
Wireless Telecommunication Services - 0.5%
Nextel Communications, Inc. Class A (a)	25,800		774,000
Vodafone Group PLC	326,000		892,588
			1,666,588
TOTAL TELECOMMUNICATION SERVICES			16,790,561
UTILITIES - 0.6%
Electric Utilities - 0.6%
Entergy Corp.	7,700		520,443
FirstEnergy Corp.	17,000		671,670
PG&E Corp. (a)	24,600		818,688
			2,010,801
TOTAL COMMON STOCKS (Cost $202,201,296)		230,260,362
Convertible Preferred Stocks - 0.1%

MATERIALS - 0.1%
Paper & Forest Products - 0.1%
International Paper Capital Trust 2.625%	5,200		260,624
TELECOMMUNICATION SERVICES - 0.0%
Diversified Telecommunication Services - 0.0%
Cincinnati Bell, Inc. Series B, 6.75%	1,300		52,975
TOTAL CONVERTIBLE PREFERRED STOCKS (Cost $302,688)		313,599
Corporate Bonds - 1.7%
		Principal Amount		Value (Note 1)
Convertible Bonds - 0.5%
CONSUMER DISCRETIONARY - 0.1%
Specialty Retail - 0.1%
Gap, Inc. 5.75% 3/15/09 (e)		$ 180,000		$ 239,256
INDUSTRIALS - 0.4%
Industrial Conglomerates - 0.4%
Tyco International Group SA yankee 3.125% 1/15/23		720,000		1,211,184
INFORMATION TECHNOLOGY - 0.0%
Communications Equipment - 0.0%
CIENA Corp. 3.75% 2/1/08		100,000		88,750
TOTAL CONVERTIBLE BONDS				1,539,190
Nonconvertible Bonds - 1.2%
CONSUMER DISCRETIONARY - 0.2%
Auto Components - 0.0%
DaimlerChrysler NA Holding Corp. 7.2% 9/1/09		50,000		55,651
Automobiles - 0.1%
Ford Motor Co.:
6.625% 10/1/28		10,000		9,327
7.45% 7/16/31		45,000		45,258
General Motors Corp.:
8.25% 7/15/23		90,000		93,750
8.375% 7/15/33		25,000		25,902
				174,237
Media - 0.1%
AOL Time Warner, Inc. 7.625% 4/15/31		25,000		30,244
Cox Communications, Inc. 7.125% 10/1/12		20,000		22,417
Liberty Media Corp. 8.25% 2/1/30		40,000		45,482
News America, Inc. 6.2% 12/15/34 (e)		100,000		101,352
				199,495
TOTAL CONSUMER DISCRETIONARY				429,383
ENERGY - 0.1%
Energy Equipment & Services - 0.0%
Petronas Capital Ltd. 7% 5/22/12 (e)		55,000		63,004
Oil & Gas - 0.1%
Amerada Hess Corp.:
6.65% 8/15/11		5,000		5,498
7.125% 3/15/33		15,000		16,493
7.375% 10/1/09		10,000		11,172
Empresa Nacional de Petroleo 6.75% 11/15/12 (e)		25,000		27,801
Corporate Bonds - continued
		Principal Amount		Value (Note 1)
Nonconvertible Bonds - continued
ENERGY - continued
Oil & Gas - continued
EnCana Holdings Finance Corp. 5.8% 5/1/14		$ 35,000		$ 37,313
Enterprise Products Operating LP:
4.625% 10/15/09 (e)		10,000		9,984
5.6% 10/15/14 (e)		5,000		5,044
Kinder Morgan Energy Partners LP 7.125% 3/15/12		15,000		17,148
Pemex Project Funding Master Trust:
6.125% 8/15/08		50,000		53,000
7.875% 2/1/09 (h)		100,000		112,350
Williams Companies, Inc.:
7.125% 9/1/11		5,000		5,463
7.5% 1/15/31		10,000		10,350
				311,616
TOTAL ENERGY				374,620
FINANCIALS - 0.5%
Capital Markets - 0.1%
Goldman Sachs Group, Inc. 6.6% 1/15/12		125,000		139,505
Merrill Lynch & Co., Inc.:
4.125% 1/15/09		75,000		75,413
5% 1/15/15		25,000		24,902
Morgan Stanley:
4.75% 4/1/14		75,000		73,081
6.6% 4/1/12		40,000		44,613
				357,514
Commercial Banks - 0.1%
Bank of America Corp. 6.25% 4/15/12		70,000		77,308
Fleet Financial Group, Inc. 7.125% 4/15/06		40,000		41,864
Korea Development Bank 3.875% 3/2/09		75,000		74,028
Wachovia Corp. 4.875% 2/15/14		15,000		14,950
				208,150
Consumer Finance - 0.1%
Capital One Bank 5% 6/15/09		25,000		25,743
Ford Motor Credit Co. 7% 10/1/13		50,000		53,007
General Motors Acceptance Corp. 6.875% 9/15/11		35,000		35,868
Household Finance Corp.:
4.125% 11/16/09		15,000		14,919
7% 5/15/12		5,000		5,710
Household International, Inc. 8.875% 2/15/08		75,000		79,394

		Principal Amount		Value (Note 1)
MBNA America Bank NA 6.625% 6/15/12		$ 30,000		$ 33,086
MBNA Corp. 7.5% 3/15/12		45,000		51,988
				299,715
Diversified Financial Services - 0.1%
Hutchison Whampoa International 03/13 Ltd. 6.5% 2/13/13 (e)		10,000		10,777
Hutchison Whampoa International 03/33 Ltd.:
6.25% 1/24/14 (e)		25,000		26,328
7.45% 11/24/33 (e)		15,000		16,626
J.P. Morgan Chase & Co. 6.75% 2/1/11		155,000		174,128
				227,859
Insurance - 0.0%
Principal Life Global Funding I 6.25% 2/15/12 (e)		25,000		27,328
Real Estate - 0.1%
EOP Operating LP 4.65% 10/1/10		90,000		90,411
Regency Centers LP 6.75% 1/15/12		45,000		50,211
Simon Property Group LP 5.625% 8/15/14 (e)		40,000		41,424
				182,046
Thrifts & Mortgage Finance - 0.0%
Countrywide Home Loans, Inc. 4% 3/22/11		50,000		48,613
Independence Community Bank Corp. 3.75% 4/1/14 (h)		20,000		19,279
Washington Mutual, Inc.:
4.375% 1/15/08		20,000		20,312
4.625% 4/1/14		40,000		38,242
				126,446
TOTAL FINANCIALS				1,429,058
INDUSTRIALS - 0.0%
Aerospace & Defense - 0.0%
Raytheon Co. 8.3% 3/1/10		50,000		59,250
Airlines - 0.0%
Delta Air Lines, Inc. pass thru trust certificates 7.57% 11/18/10		20,000		19,728
TOTAL INDUSTRIALS				78,978
MATERIALS - 0.0%
Chemicals - 0.0%
Lubrizol Corp.:
4.625% 10/1/09		15,000		14,977
5.5% 10/1/14		5,000		5,029
6.5% 10/1/34		15,000		15,277
				35,283
Corporate Bonds - continued
		Principal Amount		Value (Note 1)
Nonconvertible Bonds - continued
MATERIALS - continued
Containers & Packaging - 0.0%
Sealed Air Corp. 5.625% 7/15/13 (e)		$ 5,000		$ 5,173
Paper & Forest Products - 0.0%
International Paper Co.:
4.25% 1/15/09		5,000		5,018
5.5% 1/15/14		20,000		20,660
				25,678
TOTAL MATERIALS				66,134
TELECOMMUNICATION SERVICES - 0.2%
Diversified Telecommunication Services - 0.2%
AT&T Broadband Corp. 8.375% 3/15/13		50,000		61,655
Bellsouth Capital Funding Corp. 7.875% 2/15/30		25,000		31,139
BellSouth Corp. 5.2% 9/15/14		25,000		25,481
British Telecommunications PLC 8.875% 12/15/30		50,000		66,951
Deutsche Telekom International Finance BV 8.75% 6/15/30		50,000		66,023
France Telecom SA:
8.5% 3/1/11		40,000		47,716
9.5% 3/1/31		50,000		67,780
SBC Communications, Inc.:
6.15% 9/15/34		30,000		30,896
6.45% 6/15/34		25,000		26,784
Sprint Capital Corp. 6.875% 11/15/28		25,000		27,370
Telecom Italia Capital:
4.95% 9/30/14 (e)		25,000		24,493
5.25% 11/15/13		50,000		50,537
Telefonica Europe BV 7.75% 9/15/10		25,000		29,317
Verizon Global Funding Corp.:
7.25% 12/1/10		45,000		51,556
7.75% 12/1/30		30,000		37,300
				644,998
Wireless Telecommunication Services - 0.0%
America Movil SA de CV:
4.125% 3/1/09		20,000		19,703
5.5% 3/1/14		15,000		14,819
AT&T Wireless Services, Inc. 7.875% 3/1/11		5,000		5,893
				40,415
TOTAL TELECOMMUNICATION SERVICES				685,413

		Principal Amount		Value (Note 1)
UTILITIES - 0.2%
Electric Utilities - 0.1%
Cleveland Electric Illuminating Co. 5.65% 12/15/13		$ 30,000		$ 31,113
DTE Energy Co. 7.05% 6/1/11		15,000		16,985
Duke Capital LLC:
6.25% 2/15/13		50,000		54,039
6.75% 2/15/32		55,000		59,851
Exelon Corp. 6.75% 5/1/11		50,000		55,931
FirstEnergy Corp. 6.45% 11/15/11		5,000		5,432
Illinois Power Co. 7.5% 6/15/09		65,000		73,312
MidAmerican Energy Holdings, Inc. 5.875% 10/1/12		50,000		52,982
Progress Energy, Inc. 7.1% 3/1/11		105,000		118,046
				467,691
Gas Utilities - 0.0%
Consolidated Natural Gas Co. 6.85% 4/15/11		25,000		28,213
NiSource Finance Corp. 7.875% 11/15/10		50,000		58,779
				86,992
Multi-Utilities & Unregulated Power - 0.1%
Constellation Energy Group, Inc. 7% 4/1/12		50,000		56,993
Dominion Resources, Inc.:
6.25% 6/30/12		85,000		92,802
8.125% 6/15/10		10,000		11,770
				161,565
TOTAL UTILITIES				716,248
TOTAL NONCONVERTIBLE BONDS				3,779,834
TOTAL CORPORATE BONDS (Cost $4,633,880)			5,319,024
U.S. Government and Government Agency Obligations - 2.4%

U.S. Government Agency Obligations - 0.5%
Fannie Mae:
3.25% 8/15/08		120,000		118,418
3.25% 2/15/09		270,000		264,750
5.5% 3/15/11		60,000		64,341
6.25% 2/1/11		105,000		115,113
Freddie Mac:
2.875% 5/15/07		500,000		494,899
3.625% 9/15/08		71,000		71,024
4% 6/12/13		87,000		83,093
U.S. Government and Government Agency Obligations - continued
		Principal Amount		Value (Note 1)
U.S. Government Agency Obligations - continued
Freddie Mac: - continued
5% 7/15/14		$ 165,000		$ 170,434
5.875% 3/21/11		170,000		183,540
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS				1,565,612
U.S. Treasury Inflation Protected Obligations - 0.2%
U.S. Treasury Inflation-Indexed Bonds 2.375% 1/15/25		202,516		216,558
U.S. Treasury Inflation-Indexed Notes:
0.875% 4/15/10		201,502		199,542
2% 1/15/14		413,192		427,654
TOTAL U.S. TREASURY INFLATION PROTECTED OBLIGATIONS				843,754
U.S. Treasury Obligations - 1.7%
U.S. Treasury Bills, yield at date of purchase 2.21% 3/10/05 (g)		600,000		597,712
U.S. Treasury Bonds:
5.375% 2/15/31		50,000		54,066
6.25% 5/15/30		200,000		239,117
U.S. Treasury Notes:
1.625% 2/28/06		2,925,000		2,885,352
3.125% 5/15/07		125,000		124,937
4.75% 5/15/14		560,000		583,581
6.5% 2/15/10		730,000		826,468
TOTAL U.S. TREASURY OBLIGATIONS				5,311,233
TOTAL U.S. GOVERNMENT AND GOVERNMENT AGENCY OBLIGATIONS (Cost $7,707,965)			7,720,599
U.S. Government Agency - Mortgage Securities - 2.2%

Fannie Mae - 2.1%
4% 7/1/19		244,586		238,916
4.302% 11/1/34 (h)		57,015		57,591
4.5% 5/1/19 to 10/1/33		1,385,596		1,348,345
5% 7/1/18 to 6/1/34		1,153,152		1,163,184
5.5% 4/1/16 to 9/1/34		1,820,206		1,854,964
5.5% 1/1/35 (f)		430,000		436,047
6% 4/1/13 to 4/1/33		189,865		198,878
6.5% 4/1/09 to 3/1/34		1,240,772		1,306,505
7.5% 5/1/24 to 2/1/28		39,448		42,403
TOTAL FANNIE MAE				6,646,833
Freddie Mac - 0.0%
7.5% 8/1/28		7,390		7,947

		Principal Amount		Value (Note 1)
Government National Mortgage Association - 0.1%
6.5% 8/15/27		$ 89,871		$ 94,959
7% 7/15/28 to 7/15/32		136,740		145,486
7.5% 1/15/26 to 8/15/28		92,005		98,899
8.5% 11/15/30		38,289		41,799
TOTAL GOVERNMENT NATIONAL MORTGAGE ASSOCIATION				381,143
TOTAL U.S. GOVERNMENT AGENCY - MORTGAGE SECURITIES (Cost $6,892,618)			7,035,923
Asset-Backed Securities - 0.1%

Ameriquest Mortgage Securities, Inc. Series 2004-R2 Class M1, 2.8475% 4/25/34 (h)		5,000		5,000
Amortizing Residential Collateral Trust Series 2003-BC1 Class M2, 3.5175% 1/25/32 (h)		10,000		10,041
Argent Securities, Inc. Series 2004-W5 Class M1, 3.0175% 4/25/34 (h)		15,000		15,020
Capital One Multi-Asset Execution Trust:
Series 2003-B4 Class B4, 3.2025% 7/15/11 (h)		25,000		25,456
Series 2004-6 Class B, 4.15% 7/16/12		40,000		39,957
CDC Mortgage Capital Trust Series 2004-HE2 Class M2, 3.6175% 7/26/34 (h)		10,000		10,000
Citibank Credit Card Issuance Trust Series 2002-C1 Class C1, 3.2% 2/9/09 (h)		50,000		50,667
Countrywide Home Loans, Inc.:
Series 2004-2 Class M1, 2.9175% 5/25/34 (h)		25,000		25,000
Series 2004-4:
Class A, 2.7875% 8/25/34 (h)		20,246		20,239
Class M1, 2.8975% 7/25/34 (h)		25,000		25,053
Class M2, 2.9475% 6/25/34 (h)		15,000		15,036
Discover Card Master Trust I Series 2003-4 Class B1, 2.7325% 5/16/11 (h)		30,000		30,160
Fremont Home Loan Trust Series 2004-A:
Class M1, 2.9675% 1/25/34 (h)		25,000		25,000
Class M2, 3.5675% 1/25/34 (h)		25,000		25,000
Asset-Backed Securities - continued
		Principal Amount		Value (Note 1)
Long Beach Mortgage Loan Trust Series 2004-2 Class M1, 2.9475% 6/25/34 (h)		$ 25,000		$ 24,980
Morgan Stanley Dean Witter Capital I Trust Series 2003-NC1 Class M1, 3.4675% 11/25/32 (h)		10,000		10,106
TOTAL ASSET-BACKED SECURITIES (Cost $355,800)			356,715
Collateralized Mortgage Obligations - 0.1%

Private Sponsor - 0.0%
CS First Boston Mortgage Securities Corp. floater:
Series 2004-AR3 Class 6A2, 2.7875% 4/25/34 (h)		13,705		13,725
Series 2004-AR5 Class 11A2, 2.7875% 6/25/34 (h)		19,286		19,245
TOTAL PRIVATE SPONSOR				32,970
U.S. Government Agency - 0.1%
Fannie Mae planned amortization class:
Series 1999-54 Class PH, 6.5% 11/18/29		100,000		106,089
Series 1999-57 Class PH, 6.5% 12/25/29		100,000		105,589
Fannie Mae guaranteed REMIC pass thru certificates planned amortization class Series 2004-81 Class KD, 4.5% 4/25/17		75,000		75,453
TOTAL U.S. GOVERNMENT AGENCY				287,131
TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS (Cost $289,530)			320,101
Commercial Mortgage Securities - 0.3%

Asset Securitization Corp. sequential pay Series 1995-MD4 Class A1, 7.1% 8/13/29		45,410		46,878
Bayview Commercial Asset Trust floater Series 2004-3 Class A1, 2.7675% 1/25/35 (e)(h)		49,914		49,914
CBM Funding Corp. sequential pay Series 1996-1:
Class A3PI, 7.08% 11/1/07		58,124		60,949
Class B, 7.48% 2/1/08		80,000		87,230

		Principal Amount		Value (Note 1)
COMM:
floater:
Series 2002-FL7 Class D, 2.9725% 11/15/14 (e)(h)		$ 10,000		$ 10,027
Series 2003-FL9 Class B, 2.9025% 11/15/15 (e)(h)		14,290		14,333
Series 2004-LBN2 Class X2, 1.2743% 3/10/39 (e)(h)(i)		59,847		2,552
CS First Boston Mortgage Securities Corp.:
sequential pay:
Series 1999-C1 Class A2, 7.29% 9/15/41		50,000		56,131
Series 2004-C1 Class A3, 4.321% 1/15/37		20,000		19,880
Series 1998-C1 Class D, 7.17% 5/17/40		15,000		16,803
Series 2004-C1 Class ASP, 1.0446% 1/15/37 (e)(h)(i)		295,000		11,798
Deutsche Mortgage & Asset Receiving Corp. sequential pay Series 1998-C1 Class D, 7.231% 6/15/31		145,000		159,490
Fannie Mae sequential pay Series 1999-10 Class MZ, 6.5% 9/17/38		43,787		46,377
GS Mortgage Securities Corp. II:
sequential pay Series 2001-LIBA Class A2, 6.615% 2/14/16 (e)		20,000		22,027
Series 1998-GLII Class E, 7.1905% 4/13/31 (h)		45,000		47,234
Leafs CMBS I Ltd./Leafs CMBS I Corp. Series 2002-1A Class B, 4.13% 11/20/37 (e)		100,000		95,523
Morgan Stanley Capital I, Inc. sequential pay Series 2004-HQ3 Class A2, 4.05% 1/13/41		20,000		19,851
Thirteen Affiliates of General Growth Properties, Inc. Series 1:
Class D2, 6.992% 11/15/07 (e)		140,000		150,697
Class E2, 7.224% 11/15/07 (e)		100,000		107,185
Wachovia Bank Commercial Mortgage Trust sequential pay Series 2003-C6 Class A2, 4.498% 8/15/35		30,000		30,427
TOTAL COMMERCIAL MORTGAGE SECURITIES (Cost $1,007,128)			1,055,306
Foreign Government and Government Agency Obligations - 0.1%

Chilean Republic:
5.625% 7/23/07		50,000		52,344
7.125% 1/11/12		15,000		17,222
Korean Republic 4.875% 9/22/14		10,000		9,891
Foreign Government and Government Agency Obligations - continued
		Principal Amount		Value (Note 1)
United Mexican States:
5.875% 1/15/14		$ 20,000		$ 20,490
7.5% 4/8/33		100,000		108,000
TOTAL FOREIGN GOVERNMENT AND GOVERNMENT AGENCY OBLIGATIONS (Cost $190,982)			207,947
Fixed-Income Funds - 7.7%
		Shares
Fidelity Floating Rate Central Investment Portfolio (b)		15,017		1,500,048
Fidelity High Income Central Investment Portfolio 1 (b)		227,807		22,921,904
TOTAL FIXED-INCOME FUNDS (Cost $22,979,335)			24,421,952
Money Market Funds - 13.3%

Fidelity Cash Central Fund, 2.24% (b)		40,132,218		40,132,218
Fidelity Securities Lending Cash Central Fund, 2.23% (b)(c)		2,250,900		2,250,900
TOTAL MONEY MARKET FUNDS (Cost $42,383,118)			42,383,118
TOTAL INVESTMENT PORTFOLIO - 100.3% (Cost $288,944,340)				319,394,646
NET OTHER ASSETS - (0.3)%				(951,058)
NET ASSETS - 100%				$ 318,443,588

Futures Contracts
	Expiration Date	Underlying Face Amount at Value	Unrealized Appreciation/(Depreciation)
Purchased
Equity Index Contracts
33 S&P 500 Index Contracts	March 2005	$ 10,013,025	$ 68,162

The face value of futures purchased as a percentage of net assets - 3.1%

Swap Agreements
	Expiration Date	Notional Amount	Value
Total Return Swap
Receive monthly a return equal to Lehman Brothers for CMBS US Aggregate Index and pay monthly a floating rate based on 1-month LIBOR with Deutsche Bank	June 2005	$ 45,000	$ 256
Receive monthly a return equal to Lehman Brothers for CMBS US Aggregate Index and pay monthly a floating rate based on 1-month LIBOR with Goldman Sachs	March 2005	105,000	555
Receive monthly a return equal to Lehman Brothers for CMBS AAA 8.5+ Index and pay monthly a floating rate based on 1-month LIBOR minus 40 basis points with Lehman Brothers, Inc.	April 2005	75,000	776
Receive monthly a return equal to Lehman Brothers for CMBS U.S. Aggregate Index and pay monthly a floating rate based on 1-month LIBOR minus 10 basis points with Lehman Brothers, Inc.	May 2005	500,000	2,608
Receive quarterly a return equal to Banc of America Securities LLC AAA 10Yr Commercial Mortgage-Backed Securities Daily Index and pay quarterly a floating rate based on 3-month LIBOR minus 72 basis points with Bank of America	Jan. 2005	75,000	(260)
Receive quarterly a return equal to that of Banc of America Securities LLC AAA 10Yr Commercial Mortgage Backed Securities Daily Index and pay quarterly a floating rate based on 3-month LIBOR minus 30 basis points with Bank of America	May 2005	100,000	(111)
		$ 900,000	$ 3,824

Legend

(a) Non-income producing

(d) Security or a portion of the security is on loan at period end.

(f) Security or a portion of the security purchased on a delayed delivery or when-issued basis.

(g) Security or a portion of the security was pledged to cover margin requirements for futures contracts. At the period end, the value of securities pledged amounted to $597,712.

(h) The coupon rate shown on floating or adjustable rate securities represents the rate at period end.

(i) Security represents right to receive monthly interest payments on an underlying pool of mortgages. Principal shown is the par amount of the mortgage pool.

Other Information

Distribution of investments by country of issue, as a percentage of total net assets, is as follows:

United States of America	89.5%
United Kingdom	1.3%
Japan	1.1%
France	1.1%
Others (individually less than 1%)	7.0%
	100.0%

The composition of credit quality ratings as a percentage of net assets is as follows (ratings are unaudited):

U.S.Government and U.S.Government Agency Obligations	4.5%
AAA,AA,A	0.4%
BBB	1.7%
BB	2.6%
B	3.9%
CCC,CC,C	0.8%
Not Rated	0.3%
Equities	75.5%
Short-Term Investments and Net Other Assets	10.3%
	100.0%

The information in the above tables are based on the combined investments of the fund and its pro-rata share of the investments of Fidelity's fixed-income central funds.

Income Tax Information

At December 31, 2004, the fund had a capital loss carryforward of approximately $68,822,000 of which $49,066,000, $11,142,000 and $8,614,000 will expire on December 31, 2009, 2010 and 2011, respectively.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products: Asset Manager: Growth Portfolio

Financial Statements

Statement of Assets and Liabilities

	December 31, 2004
Assets
Investment in securities, at value (including securities loaned of $2,187,830) (cost $288,944,340) - See accompanying schedule		$ 319,394,646
Cash		9,751
Foreign currency held at value (cost $1,391,671)		1,458,507
Receivable for investments sold		648,684
Receivable for fund shares sold		35,216
Dividends receivable		244,103
Interest receivable		401,173
Swap agreements, at value		3,824
Prepaid expenses		1,258
Other receivables		19,690
Total assets		322,216,852

Liabilities
Payable for investments purchased Regular delivery	$ 681,489
Delayed delivery	437,776
Payable for fund shares redeemed	124,430
Accrued management fee	151,894
Distribution fees payable	1,822
Payable for daily variation on futures contracts	8,250
Other affiliated payables	31,597
Other payables and accrued expenses	85,106
Collateral on securities loaned, at value	2,250,900
Total liabilities		3,773,264

Net Assets		$ 318,443,588
Net Assets consist of:
Paid in capital		$ 351,333,781
Undistributed net investment income		7,446,942
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions		(70,927,779)
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies		30,590,644
Net Assets		$ 318,443,588
Initial Class: Net Asset Value, offering price and redemption price per share ($306,137,126 ÷ 23,949,031 shares)		$ 12.78

Service Class: Net Asset Value, offering price and redemption price per share ($5,907,146 ÷ 465,360 shares)		$ 12.69

Service Class 2: Net Asset Value, offering price and redemption price per share ($6,399,316 ÷ 507,281 shares)		$ 12.61

Statement of Operations

	Year ended December 31, 2004
Investment Income
Dividends		$ 3,851,689
Special Dividends		1,184,325
Interest		4,527,681
Security lending		8,597
Total income		9,572,292

Expenses
Management fee	$ 1,905,182
Transfer agent fees	232,802
Distribution fees	23,220
Accounting and security lending fees	174,697
Non-interested trustees' compensation	1,833
Custodian fees and expenses	51,136
Registration fees	5
Audit	47,631
Legal	1,517
Miscellaneous	71,114
Total expenses before reductions	2,509,137
Expense reductions	(38,077)	2,471,060
Net investment income (loss)		7,101,232
Realized and Unrealized Gain (Loss) Net realized gain (loss) on:
Investment securities	6,062,481
Foreign currency transactions	(12,652)
Futures contracts	1,002,718
Swap agreements	33,792
Total net realized gain (loss)		7,086,339
Change in net unrealized appreciation (depreciation) on: Investment securities	4,194,646
Assets and liabilities in foreign currencies	68,328
Futures contracts	(328,259)
Swap agreements	(4,113)
Delayed delivery commitments	(9)
Total change in net unrealized appreciation (depreciation)		3,930,593
Net gain (loss)		11,016,932
Net increase (decrease) in net assets resulting from operations		$ 18,118,164

See accompanying notes which are an integral part of the financial statements.

Asset Manager: Growth Portfolio

Statement of Changes in Net Assets

	Year ended December 31, 2004	Year ended December 31, 2003
Increase (Decrease) in Net Assets
Operations
Net investment income (loss)	$ 7,101,232	$ 7,266,015
Net realized gain (loss)	7,086,339	(6,943,753)
Change in net unrealized appreciation (depreciation)	3,930,593	65,516,088
Net increase (decrease) in net assets resulting from operations	18,118,164	65,838,350
Distributions to shareholders from net investment income	(7,897,225)	(8,995,679)
Share transactions - net increase (decrease)	(40,448,482)	(2,618,363)
Total increase (decrease) in net assets	(30,227,543)	54,224,308

Net Assets
Beginning of period	348,671,131	294,446,823
End of period (including undistributed net investment income of $7,446,942 and undistributed net investment income of $8,517,550, respectively)	$ 318,443,588	$ 348,671,131

Other Information:
Share Transactions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2
Shares Sold	1,551,941	19,730	208,638
Reinvested	611,000	11,814	12,205
Redeemed	(5,399,771)	(112,237)	(262,595)
Net increase (decrease)	(3,236,830)	(80,693)	(41,752)

Dollars Sold	$ 19,043,356	$ 237,067	$ 2,533,515
Reinvested	7,600,835	146,142	150,249
Redeemed	(65,636,699)	(1,359,267)	(3,163,680)
Net increase (decrease)	$ (38,992,508)	$ (976,058)	$ (479,916)

Share Transactions	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2
Shares Sold	2,762,140	14,055	234,611
Reinvested	904,884	18,903	12,490
Redeemed	(4,008,936)	(81,582)	(93,999)
Net increase (decrease)	(341,912)	(48,624)	153,102

Dollars Sold	$ 30,831,473	$ 157,481	$ 2,571,962
Reinvested	8,695,938	180,711	119,030
Redeemed	(43,277,864)	(881,741)	(1,015,353)
Net increase (decrease)	$ (3,750,453)	$ (543,549)	$ 1,675,639

Distributions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2
From net investment income	$ 7,600,835	$ 146,142	$ 150,248

	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2
From net investment income	$ 8,695,938	$ 180,711	$ 119,030

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Initial Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 12.33	$ 10.33	$ 12.56	$ 14.41	$ 18.38
Income from Investment Operations
Net investment income (loss)^C	.26^D	.26	.32	.32	.42
Net realized and unrealized gain (loss)	.47	2.06	(2.23)	(1.31)	(2.52)
Total from investment operations	.73	2.32	(1.91)	(.99)	(2.10)
Distributions from net investment income	(.28)	(.32)	(.32)	(.39)	(.37)
Distributions from net realized gain	-	-	-	(.47)	(1.50)
Total distributions	(.28)	(.32)	(.32)	(.86)	(1.87)
Net asset value, end of period	$ 12.78	$ 12.33	$ 10.33	$ 12.56	$ 14.41
Total Return^A,B	5.98%	23.34%	(15.53)%	(7.39)%	(12.47)%
Ratios to Average Net Assets^E
Expenses before expense reductions	.75%	.73%	.73%	.73%	.69%
Expenses net of voluntary waivers, if any	.75%	.73%	.73%	.73%	.69%
Expenses net of all reductions	.74%	.72%	.69%	.72%	.68%
Net investment income (loss)	2.15%	2.33%	2.88%	2.55%	2.61%
Supplemental Data
Net assets, end of period (000 omitted)	$ 306,137	$ 335,285	$ 284,298	$ 399,273	$ 482,165
Portfolio turnover rate	57%	65%	149%	111%	147%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^D Investment income per share reflects a special dividend which amounted to $.04 per share.

Financial Highlights - Service Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 12.25	$ 10.27	$ 12.47	$ 14.32	$ 18.28
Income from Investment Operations
Net investment income (loss)^C	.25^D	.24	.30	.31	.40
Net realized and unrealized gain (loss)	.46	2.05	(2.20)	(1.32)	(2.50)
Total from investment operations	.71	2.29	(1.90)	(1.01)	(2.10)
Distributions from net investment income	(.27)	(.31)	(.30)	(.37)	(.36)
Distributions from net realized gain	-	-	-	(.47)	(1.50)
Total distributions	(.27)	(.31)	(.30)	(.84)	(1.86)
Net asset value, end of period	$ 12.69	$ 12.25	$ 10.27	$ 12.47	$ 14.32
Total Return^A,B	5.85%	23.15%	(15.54)%	(7.57)%	(12.54)%
Ratios to Average Net Assets^E
Expenses before expense reductions	.88%	.85%	.84%	.83%	.80%
Expenses net of voluntary waivers, if any	.88%	.85%	.84%	.83%	.80%
Expenses net of all reductions	.87%	.84%	.80%	.82%	.79%
Net investment income (loss)	2.02%	2.21%	2.77%	2.44%	2.50%
Supplemental Data
Net assets, end of period (000 omitted)	$ 5,907	$ 6,692	$ 6,105	$ 9,542	$ 12,449
Portfolio turnover rate	57%	65%	149%	111%	147%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^D Investment income per share reflects a special dividend which amounted to $.04 per share.

See accompanying notes which are an integral part of the financial statements.

Asset Manager: Growth Portfolio

Financial Highlights - Service Class 2

Years ended December 31,	2004	2003	2002	2001	2000^G
Selected Per-Share Data
Net asset value, beginning of period	$ 12.19	$ 10.21	$ 12.43	$ 14.30	$ 17.78
Income from Investment Operations
Net investment income (loss)^E	.22^F	.22	.28	.28	.34
Net realized and unrealized gain (loss)	.46	2.05	(2.21)	(1.30)	(1.96)
Total from investment operations	.68	2.27	(1.93)	(1.02)	(1.62)
Distributions from net investment income	(.26)	(.29)	(.29)	(.38)	(.36)
Distributions from net realized gain	-	-	-	(.47)	(1.50)
Total distributions	(.26)	(.29)	(.29)	(.85)	(1.86)
Net asset value, end of period	$ 12.61	$ 12.19	$ 10.21	$ 12.43	$ 14.30
Total Return^B,C,D	5.63%	23.03%	(15.83)%	(7.66)%	(10.21)%
Ratios to Average Net Assets^H
Expenses before expense reductions	1.06%	1.05%	1.03%	1.00%	.97%^A
Expenses net of voluntary waivers, if any	1.06%	1.05%	1.03%	1.00%	.97%^A
Expenses net of all reductions	1.05%	1.04%	.99%	.99%	.95%^A
Net investment income (loss)	1.84%	2.01%	2.58%	2.28%	2.33%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 6,399	$ 6,694	$ 4,044	$ 5,213	$ 3,091
Portfolio turnover rate	57%	65%	149%	111%	147%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F Investment income per share reflects a special dividend which amounted to $.04 per share.

^G For the period January 12, 2000 (commencement of sale of shares) to December 31, 2000.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products: Balanced Portfolio

Performance: The Bottom Line

Average Annual Total Returns

Periods ended December 31, 2004	Past 1 year	Past 5 years	Life of fund^A
Fidelity ® VIP: Balanced - Initial Class	5.47%	1.32%	7.23%
Fidelity VIP: Balanced - Service Class^B	5.42%	1.22%	7.14%
Fidelity VIP: Balanced - Service Class 2^C	5.15%	1.05%	7.05%

^A From January 3, 1995.

^BThe initial offering of Service Class shares took place on November 3, 1997. Performance for Service Class shares reflects an asset-based service fee (12b-1 fee), and returns prior to November 3, 1997 are those of Initial Class and do not include the effects of Service Class' 12b-1 fee. Had Service Class shares' 12b-1 fee been reflected, returns prior to November 3, 1997 would have been lower.

^CThe initial offering of Service Class 2 shares took place on January 12, 2000. Performance for Service Class 2 shares reflects an asset-based service fee (12b-1 fee). Returns from November 3, 1997 through January 12, 2000 are those of Service Class which reflects a different 12b-1 fee. Service Class 2 returns prior to November 3, 1997 are those of Initial Class, and do not include the effects of a 12b-1 fee. Had Service Class 2's 12b-1 fee been reflected, returns prior to January 12, 2000 would have been lower.

$10,000 Over Life of Fund

Let's say hypothetically that $10,000 was invested in Fidelity® Variable Insurance Products: Balanced Portfolio - Initial Class on January 3, 1995, when the fund started. The chart shows how the value of your investment would have changed, and also shows how the S&P 500® Index performed over the same period.

Balanced Portfolio

Fidelity Variable Insurance Products: Balanced Portfolio

Management's Discussion of Fund Performance

Comments from Louis Salemy, Lead Portfolio Manager of Fidelity® Variable Insurance Products: Balanced Portfolio

Equity and fixed-income benchmarks finished the year ending December 31, 2004, with positive returns. In the equity markets, small-cap stocks outperformed large-caps for the sixth consecutive year, as the Russell 2000® Index was up 18.33% compared to 10.88% for the larger-cap Standard & Poor's 500^SM Index. Meanwhile, value stocks topped growth stocks: The Russell 3000® Value Index advanced 16.94%, compared to 6.93% for the Russell 3000 Growth Index. Elsewhere, the tech-heavy NASDAQ Composite® Index returned 9.15%, thanks primarily to a 14.87% jump in the fourth quarter, and the Dow Jones Industrial Average^SM gained 5.37%. Despite five increases in short-term interest rates, the Lehman Brothers® Aggregate Bond Index rose 4.34% in 2004. While that's roughly half of the benchmark's historical average annual return, it's better than many analysts expected as 2004 began, given concerns about the potentially high levels of economic growth and subsequent inflation at the start of the year. However, the economic expansion was more moderate than anticipated, and the Fed reassured investors that rate tightening would be undertaken at a "measured pace."

For the 12 months ending December 31, 2004, the fund lagged the 8.30% return of the Fidelity Balanced 60/40 Composite Index and the 8.55% gain of the Lipper^SM Variable Annuity Balanced Funds Average. Unrewarding stock picking and a significant overweighting in the media industry caused the fund to underperform the index, whereas the fixed-income subportfolio helped reduce the degree of underperformance - largely on the strength of some out-of-index investments in the outperforming high-yield sector. EchoStar Communications, a detractor on the equity side, was the victim of fears about increasing competition from rival satellite TV providers and from the cable industry. Meanwhile, brokerage holdings Morgan Stanley and Merrill Lynch both were sidetracked by investors' concerns about the impact of rising interest rates on future business. On the other hand, my decision to underweight both information technology and health care helped relative performance. In the consumer staples sector, razor manufacturer Gillette was a significant contributor both in absolute terms and compared with the index. Verizon Communications also aided performance, boosted by a regulatory change that enabled the company to charge higher rates for leasing its network to competitors.

Annual Report

Fidelity Variable Insurance Products: Balanced Portfolio

Investment Summary

Top Five Stocks as of December 31, 2004
	% of fund's net assets
EchoStar Communications Corp. Class A	5.1
Omnicom Group, Inc.	4.6
BellSouth Corp.	3.4
Morgan Stanley	3.2
Wells Fargo & Co.	3.2
	19.5
Top Five Market Sectors as of December 31, 2004
	% of fund's net assets
Financials	16.7
Consumer Discretionary	15.8
Telecommunication Services	9.0
Consumer Staples	8.7
Information Technology	4.1

Asset Allocation as of December 31, 2004
% of fund's net assets*
	Stocks	55.9%
	Bonds	36.3%
	Short-Term Investments and Net Other Assets	7.7%
	Other Investments	0.1%
* Foreign investments		5.0%

Percentages are adjusted for the effect of futures contracts and swaps, if applicable.

Balanced Portfolio

Fidelity Variable Insurance Products: Balanced Portfolio

Investments December 31, 2004

Showing Percentage of Net Assets

Common Stocks - 55.9%
	Shares		Value (Note 1)
CONSUMER DISCRETIONARY - 14.1%
Hotels, Restaurants & Leisure - 0.4%
Carnival Corp. unit	21,100		$ 1,215,993
Media - 11.7%
E.W. Scripps Co. Class A	89,600		4,325,888
EchoStar Communications Corp. Class A	532,979		17,716,209
News Corp. Class B (e)	143,000		2,745,600
Omnicom Group, Inc.	190,200		16,037,664
			40,825,361
Multiline Retail - 1.6%
Kohl's Corp. (a)	111,900		5,502,123
Textiles, Apparel & Luxury Goods - 0.4%
Liz Claiborne, Inc.	29,000		1,224,090
Reebok International Ltd.	7,400		325,600
			1,549,690
TOTAL CONSUMER DISCRETIONARY			49,093,167
CONSUMER STAPLES - 8.4%
Beverages - 0.5%
The Coca-Cola Co.	44,200		1,840,046
Food & Staples Retailing - 3.9%
Costco Wholesale Corp.	63,500		3,074,035
Wal-Mart Stores, Inc.	142,800		7,542,696
Walgreen Co.	75,100		2,881,587
			13,498,318
Food Products - 0.3%
McCormick & Co., Inc. (non-vtg.)	30,200		1,165,720
Household Products - 1.6%
Colgate-Palmolive Co.	29,800		1,524,568
Kimberly-Clark Corp.	59,900		3,942,019
			5,466,587
Personal Products - 1.3%
Gillette Co.	101,500		4,545,170
Tobacco - 0.8%
Altria Group, Inc.	48,650		2,972,515
TOTAL CONSUMER STAPLES			29,488,356
ENERGY - 2.8%
Oil & Gas - 2.8%
BP PLC sponsored ADR	49,200		2,873,280
Exxon Mobil Corp.	133,232		6,829,472
			9,702,752
FINANCIALS - 14.0%
Capital Markets - 7.4%
Goldman Sachs Group, Inc.	58,000		6,034,320

	Shares		Value (Note 1)
Merrill Lynch & Co., Inc.	144,900		$ 8,660,673
Morgan Stanley	205,100		11,387,152
			26,082,145
Commercial Banks - 3.2%
Wells Fargo & Co.	178,200		11,075,130
Consumer Finance - 0.6%
American Express Co.	35,600		2,006,772
Insurance - 2.8%
Allstate Corp.	44,000		2,275,680
American International Group, Inc.	70,450		4,626,452
PartnerRe Ltd.	19,200		1,189,248
St. Paul Travelers Companies, Inc.	45,249		1,677,380
			9,768,760
TOTAL FINANCIALS			48,932,807
HEALTH CARE - 1.0%
Health Care Equipment & Supplies - 0.5%
Alcon, Inc.	20,800		1,676,480
Pharmaceuticals - 0.5%
Pfizer, Inc.	66,900		1,798,941
TOTAL HEALTH CARE			3,475,421
INDUSTRIALS - 2.8%
Aerospace & Defense - 0.7%
Lockheed Martin Corp.	19,500		1,083,225
Northrop Grumman Corp.	27,800		1,511,208
			2,594,433
Airlines - 0.3%
Continental Airlines, Inc. Class B (a)	75,200		1,018,208
Industrial Conglomerates - 1.4%
General Electric Co.	131,800		4,810,700
Road & Rail - 0.4%
Union Pacific Corp.	19,900		1,338,275
TOTAL INDUSTRIALS			9,761,616
INFORMATION TECHNOLOGY - 3.6%
Communications Equipment - 0.9%
Cisco Systems, Inc. (a)	162,500		3,136,250
Lucent Technologies, Inc. warrants 12/10/07 (a)	13,353		21,098
			3,157,348
Computers & Peripherals - 0.4%
Diebold, Inc.	25,500		1,421,115
IT Services - 0.4%
Paychex, Inc.	39,600		1,349,568
Common Stocks - continued
	Shares		Value (Note 1)
INFORMATION TECHNOLOGY - continued
Software - 1.9%
Computer Associates International, Inc.	119		$ 3,696
Microsoft Corp.	253,700		6,776,327
			6,780,023
TOTAL INFORMATION TECHNOLOGY			12,708,054
MATERIALS - 1.5%
Containers & Packaging - 1.5%
Packaging Corp. of America	25,900		609,945
Smurfit-Stone Container Corp. (a)	256,623		4,793,718
			5,403,663
TELECOMMUNICATION SERVICES - 7.4%
Diversified Telecommunication Services - 7.4%
BellSouth Corp.	424,500		11,796,855
SBC Communications, Inc.	138,870		3,578,680
Telewest Global, Inc. (a)	5,008		88,041
Verizon Communications, Inc.	260,000		10,532,600
			25,996,176
Wireless Telecommunication Services - 0.0%
DigitalGlobe, Inc. (f)	163		163
TOTAL TELECOMMUNICATION SERVICES			25,996,339
UTILITIES - 0.3%
Electric Utilities - 0.3%
Entergy Corp.	13,200		892,188
TOTAL COMMON STOCKS (Cost $162,312,978)		195,454,363
Nonconvertible Preferred Stocks - 0.0%

CONSUMER DISCRETIONARY - 0.0%
Media - 0.0%
PRIMEDIA, Inc. Series D, 10.00%	80		8,040
TOTAL NONCONVERTIBLE PREFERRED STOCKS (Cost $7,680)		8,040
Corporate Bonds - 11.8%
		Principal Amount
Convertible Bonds - 0.1%
INFORMATION TECHNOLOGY - 0.1%
Electronic Equipment & Instruments - 0.1%
Celestica, Inc. liquid yield option note 0% 8/1/20		$ 410,000		227,550

		Principal Amount		Value (Note 1)
TELECOMMUNICATION SERVICES - 0.0%
Wireless Telecommunication Services - 0.0%
Nextel Communications, Inc. 5.25% 1/15/10		$ 150,000		$ 153,000
TOTAL CONVERTIBLE BONDS				380,550
Nonconvertible Bonds - 11.7%
CONSUMER DISCRETIONARY - 1.7%
Auto Components - 0.1%
DaimlerChrysler NA Holding Corp. 7.2% 9/1/09		150,000		166,952
Dana Corp. 6.5% 3/1/09		30,000		31,650
Delco Remy International, Inc. 9.375% 4/15/12		95,000		98,325
Stoneridge, Inc. 11.5% 5/1/12		15,000		17,175
Tenneco Automotive, Inc. 8.625% 11/15/14 (f)		40,000		41,500
Visteon Corp.:
7% 3/10/14		55,000		52,388
8.25% 8/1/10		45,000		47,250
				455,240
Automobiles - 0.2%
Ford Motor Co.:
6.625% 10/1/28		40,000		37,310
7.45% 7/16/31		200,000		201,148
General Motors Corp.:
8.25% 7/15/23		415,000		432,294
8.375% 7/15/33		120,000		124,330
				795,082
Hotels, Restaurants & Leisure - 0.3%
Argosy Gaming Co. 7% 1/15/14		40,000		44,400
Carrols Corp. 9% 1/15/13 (f)		55,000		56,925
Friendly Ice Cream Corp. 8.375% 6/15/12		15,000		14,700
Gaylord Entertainment Co. 8% 11/15/13		40,000		43,200
Host Marriott LP 7.125% 11/1/13		35,000		37,275
Landry's Seafood Restaurants, Inc. 7.5% 12/15/14 (f)		105,000		104,606
Mandalay Resort Group 6.5% 7/31/09		95,000		99,750
MGM MIRAGE:
5.875% 2/27/14		90,000		89,100
9.75% 6/1/07		15,000		16,725
Mohegan Tribal Gaming Authority 6.375% 7/15/09		80,000		82,700
Morton's Restaurant Group, Inc. 7.5% 7/1/10		30,000		29,250
NCL Corp. Ltd. 10.625% 7/15/14 (f)		25,000		24,750
Penn National Gaming, Inc. 6.875% 12/1/11		90,000		93,600
Corporate Bonds - continued
		Principal Amount		Value (Note 1)
Nonconvertible Bonds - continued
CONSUMER DISCRETIONARY - continued
Hotels, Restaurants & Leisure - continued
Six Flags, Inc. 9.625% 6/1/14		$ 90,000		$ 91,125
Station Casinos, Inc. 6% 4/1/12		60,000		61,800
Vail Resorts, Inc. 6.75% 2/15/14		40,000		40,650
Virgin River Casino Corp./RBG LLC/B&BB, Inc. 9% 1/15/12 (f)		20,000		20,800
Wynn Las Vegas LLC/ Wynn Las Vegas Capital Corp. 6.625% 12/1/14 (f)		130,000		128,863
				1,080,219
Household Durables - 0.1%
Levitz Home Furnishings, Inc. 12% 11/1/11 (f)		60,000		61,200
Standard Pacific Corp. 7.75% 3/15/13		150,000		161,063
WCI Communities, Inc. 7.875% 10/1/13		40,000		42,100
				264,363
Leisure Equipment & Products - 0.0%
K2, Inc. 7.375% 7/1/14 (f)		30,000		32,550
True Temper Sports, Inc. 8.375% 9/15/11		20,000		18,600
				51,150
Media - 0.8%
Advanstar Communications, Inc. 10.75% 8/15/10		40,000		45,100
AMC Entertainment, Inc. 9.875% 2/1/12		35,000		37,800
AOL Time Warner, Inc. 7.625% 4/15/31		100,000		120,976
Cablevision Systems Corp.:
6.6688% 4/1/09 (f)(h)		90,000		95,625
8% 4/15/12 (f)		130,000		138,288
CanWest Media, Inc. 8% 9/15/12 (f)		30,000		32,025
CBD Media LLC/ CBD Finance, Inc. 8.625% 6/1/11		20,000		21,100
Charter Communications Operating LLC/Charter Communications Operating Capital Corp. 8% 4/30/12 (f)		80,000		83,400
Corus Entertainment, Inc. 8.75% 3/1/12		240,000		263,100
Cox Communications, Inc. 7.125% 10/1/12		100,000		112,086
CSC Holdings, Inc.:
7.625% 4/1/11		170,000		183,600
7.625% 7/15/18		20,000		21,200
Dex Media, Inc.:
0% 11/15/13 (d)		45,000		35,100
8% 11/15/13		110,000		118,800

		Principal Amount		Value (Note 1)
Houghton Mifflin Co. 9.875% 2/1/13		$ 85,000		$ 92,863
Kabel Deutschland GmbH 10.625% 7/1/14 (f)		40,000		46,000
LBI Media Holdings, Inc. 0% 10/15/13 (d)		90,000		66,150
LBI Media, Inc. 10.125% 7/15/12		160,000		178,400
Liberty Media Corp. 8.25% 2/1/30		100,000		113,706
Loews Cineplex Entertainment Corp. 9% 8/1/14 (f)		80,000		86,800
News America, Inc. 6.2% 12/15/34 (f)		250,000		253,379
Nexstar Broadcasting, Inc. 7% 1/15/14		60,000		59,400
PanAmSat Corp. 9% 8/15/14 (f)		40,000		44,600
PEI Holdings, Inc. 11% 3/15/10		27,000		31,455
PRIMEDIA, Inc. 7.625% 4/1/08		235,000		237,350
Rogers Cable, Inc. 6.75% 3/15/15 (f)		120,000		121,950
Time Warner, Inc. 6.625% 5/15/29		105,000		113,139
Videotron Ltee 6.875% 1/15/14 (f)		110,000		114,400
				2,867,792
Multiline Retail - 0.1%
Dillard's, Inc. 6.69% 8/1/07		125,000		128,750
Specialty Retail - 0.1%
Asbury Automotive Group, Inc.:
8% 3/15/14		145,000		143,550
9% 6/15/12		45,000		47,363
Blockbuster, Inc. 9% 9/1/12 (f)		60,000		60,000
Sonic Automotive, Inc. 8.625% 8/15/13		90,000		96,300
				347,213
TOTAL CONSUMER DISCRETIONARY				5,989,809
CONSUMER STAPLES - 0.3%
Food & Staples Retailing - 0.2%
Ahold Finance USA, Inc.:
6.875% 5/1/29		50,000		48,750
8.25% 7/15/10		120,000		136,800
Jean Coutu Group, Inc.:
7.625% 8/1/12 (f)		30,000		31,725
8.5% 8/1/14 (f)		70,000		71,750
NeighborCare, Inc. 6.875% 11/15/13		75,000		79,125
Rite Aid Corp.:
6% 12/15/05 (f)		35,000		35,350
8.125% 5/1/10		60,000		63,300
9.5% 2/15/11		60,000		66,000
Stater Brothers Holdings, Inc. 5.99% 6/15/10 (h)		60,000		61,650
				594,450
Corporate Bonds - continued
		Principal Amount		Value (Note 1)
Nonconvertible Bonds - continued
CONSUMER STAPLES - continued
Food Products - 0.1%
Del Monte Corp. 9.25% 5/15/11		$ 145,000		$ 159,500
Doane Pet Care Co. 10.75% 3/1/10		45,000		48,150
Hines Nurseries, Inc. 10.25% 10/1/11		20,000		21,850
Reddy Ice Group, Inc. 8.875% 8/1/11		20,000		21,600
Smithfield Foods, Inc. 7% 8/1/11 (f)		140,000		149,450
United Agriculture Products, Inc. 8.25% 12/15/11 (f)		27,000		28,958
				429,508
Personal Products - 0.0%
Jafra Cosmetics International, Inc./Distribuidora Comercial Jafra SA de CV 10.75% 5/15/11		40,000		45,200
Tobacco - 0.0%
Altria Group, Inc. 7% 11/4/13		110,000		119,190
TOTAL CONSUMER STAPLES				1,188,348
ENERGY - 1.2%
Energy Equipment & Services - 0.2%
Grant Prideco, Inc. 9% 12/15/09		20,000		22,425
Hanover Compressor Co.:
8.625% 12/15/10		30,000		32,700
9% 6/1/14		30,000		33,300
Hornbeck Offshore Services, Inc. 6.125% 12/1/14 (f)		85,000		84,575
Petronas Capital Ltd. 7% 5/22/12 (f)		395,000		452,484
Pride International, Inc. 7.375% 7/15/14		40,000		43,600
Seabulk International, Inc. 9.5% 8/15/13		80,000		84,800
				753,884
Oil & Gas - 1.0%
Amerada Hess Corp.:
6.65% 8/15/11		25,000		27,492
7.125% 3/15/33		75,000		82,467
7.375% 10/1/09		60,000		67,035
Belden & Blake Corp. 8.75% 7/15/12 (f)		20,000		20,450
Chesapeake Energy Corp.:
7.5% 9/15/13		70,000		76,213
7.5% 6/15/14		40,000		43,600
El Paso Corp.:
7% 5/15/11		90,000		90,450
7.875% 6/15/12		120,000		124,800

		Principal Amount		Value (Note 1)
El Paso Energy Corp.:
6.95% 12/15/07		$ 55,000		$ 57,338
7.375% 12/15/12		30,000		30,113
El Paso Production Holding Co. 7.75% 6/1/13		180,000		187,650
Empresa Nacional de Petroleo 6.75% 11/15/12 (f)		120,000		133,445
EnCana Holdings Finance Corp. 5.8% 5/1/14		80,000		85,287
Enterprise Products Operating LP:
4.625% 10/15/09 (f)		45,000		44,929
5.6% 10/15/14 (f)		30,000		30,266
General Maritime Corp. 10% 3/15/13		120,000		138,000
Kinder Morgan Energy Partners LP 7.125% 3/15/12		70,000		80,026
Overseas Shipholding Group, Inc. 8.25% 3/15/13		110,000		122,375
Pemex Project Funding Master Trust:
6.125% 8/15/08		400,000		424,000
7.875% 2/1/09 (h)		180,000		202,230
Plains Exploration & Production Co.:
7.125% 6/15/14		40,000		43,800
8.75% 7/1/12		60,000		67,125
Range Resources Corp. 7.375% 7/15/13		110,000		117,700
Ship Finance International Ltd. 8.5% 12/15/13		360,000		370,800
Stone Energy Corp. 6.75% 12/15/14 (f)		20,000		19,800
Teekay Shipping Corp. 8.875% 7/15/11		100,000		116,000
The Coastal Corp.:
6.5% 5/15/06		15,000		15,506
6.5% 6/1/08		75,000		75,375
7.5% 8/15/06		90,000		94,950
7.625% 9/1/08		10,000		10,388
7.75% 6/15/10		35,000		36,575
Venoco, Inc. 8.75% 12/15/11 (f)		60,000		61,800
Williams Companies, Inc.:
7.125% 9/1/11		125,000		136,563
7.5% 1/15/31		10,000		10,350
7.625% 7/15/19		105,000		114,450
8.75% 3/15/32		25,000		28,750
				3,388,098
TOTAL ENERGY				4,141,982
FINANCIALS - 2.7%
Capital Markets - 0.7%
BCP Caylux Holdings Luxembourg SCA 9.625% 6/15/14 (f)		150,000		168,000
Equinox Holdings Ltd. 9% 12/15/09		20,000		21,200
Corporate Bonds - continued
		Principal Amount		Value (Note 1)
Nonconvertible Bonds - continued
FINANCIALS - continued
Capital Markets - continued
Goldman Sachs Group, Inc.:
5.25% 10/15/13		$ 500,000		$ 511,550
6.6% 1/15/12		410,000		457,576
Merrill Lynch & Co., Inc.:
4.125% 1/15/09		700,000		703,855
5% 1/15/15		25,000		24,902
Morgan Stanley:
3.875% 1/15/09		500,000		497,221
4.75% 4/1/14		75,000		73,081
6.6% 4/1/12		160,000		178,451
				2,635,836
Commercial Banks - 0.3%
Bank of America Corp.:
6.25% 4/15/12		125,000		138,051
7.4% 1/15/11		155,000		179,549
Fleet Financial Group, Inc. 7.125% 4/15/06		140,000		146,523
Korea Development Bank 3.875% 3/2/09		250,000		246,759
PNC Funding Corp. 5.75% 8/1/06		155,000		160,742
Wachovia Corp. 4.875% 2/15/14		90,000		89,701
Wells Fargo & Co. 4.2% 1/15/10		45,000		45,183
				1,006,508
Consumer Finance - 0.4%
Capital One Bank 5% 6/15/09		250,000		257,427
Ford Motor Credit Co. 7% 10/1/13		275,000		291,536
General Motors Acceptance Corp. 6.875% 9/15/11		115,000		117,851
Household Finance Corp. 4.125% 11/16/09		300,000		298,387
Household International, Inc. 8.875% 2/15/08		150,000		158,787
MBNA Corp.:
6.25% 1/17/07		120,000		126,268
7.5% 3/15/12		175,000		202,177
				1,452,433
Diversified Financial Services - 0.7%
Alliance Capital Management LP 5.625% 8/15/06		150,000		155,022
BRL Universal Equipment 2001 A LP/BRL Universal Equipment Corp. 8.875% 2/15/08		120,000		127,200
Charter Communications Holdings LLC/Charter Communications Holdings Capital Corp.:
0% 5/15/11 (d)		116,000		85,260
9.625% 11/15/09		170,000		148,750

		Principal Amount		Value (Note 1)
CMS Energy X-TRAS pass thru trust certificates 7% 1/15/05		$ 75,000		$ 75,000
Couche Tard U.S. LP /Couche Tard Financing Corp. 7.5% 12/15/13		70,000		75,950
Dex Media West LLC/Dex Media West Finance Co. 9.875% 8/15/13		39,000		44,850
Gerdau AmeriSteel Corp./GUSAP Partners 10.375% 7/15/11		130,000		152,750
Hutchison Whampoa International 03/13 Ltd. 6.5% 2/13/13 (f)		55,000		59,273
Hutchison Whampoa International 03/33 Ltd.:
6.25% 1/24/14 (f)		120,000		126,372
7.45% 11/24/33 (f)		85,000		94,213
J.P. Morgan Chase & Co. 6.75% 2/1/11		635,000		713,363
National Beef Packing Co. LLC/National Beef Finance Corp. 10.5% 8/1/11		105,000		108,675
Refco Finance Holdings LLC/Refco Finance, Inc. 9% 8/1/12 (f)		100,000		109,000
U.S. West Capital Funding, Inc. 6.375% 7/15/08		45,000		44,438
UGS Corp. 10% 6/1/12 (f)		35,000		39,725
Universal City Development Partners Ltd./UCDP Finance, Inc. 11.75% 4/1/10		80,000		94,700
Universal City Florida Holding Co. I/II 7.2% 5/1/10 (f)(h)		40,000		41,500
				2,296,041
Insurance - 0.1%
Principal Life Global Funding I 6.25% 2/15/12 (f)		85,000		92,915
Provident Companies, Inc.:
7% 7/15/18		10,000		9,650
7.25% 3/15/28		15,000		14,194
UnumProvident Corp.:
6.75% 12/15/28		65,000		57,525
7.625% 3/1/11		55,000		57,613
				231,897
Real Estate - 0.3%
BRE Properties, Inc. 5.95% 3/15/07		250,000		260,509
EOP Operating LP:
4.65% 10/1/10		200,000		200,914
7% 7/15/11		200,000		225,549
Senior Housing Properties Trust:
7.875% 4/15/15		40,000		44,000
8.625% 1/15/12		80,000		91,400
Simon Property Group LP 5.625% 8/15/14 (f)		200,000		207,122
				1,029,494
Corporate Bonds - continued
		Principal Amount		Value (Note 1)
Nonconvertible Bonds - continued
FINANCIALS - continued
Thrifts & Mortgage Finance - 0.2%
Countrywide Home Loans, Inc. 4% 3/22/11		$ 250,000		$ 243,065
Independence Community Bank Corp. 3.75% 4/1/14 (h)		95,000		91,573
Washington Mutual, Inc.:
4.375% 1/15/08		90,000		91,403
4.625% 4/1/14		200,000		191,211
				617,252
TOTAL FINANCIALS				9,269,461
HEALTH CARE - 0.4%
Health Care Providers & Services - 0.3%
AmeriPath, Inc. 10.5% 4/1/13		105,000		111,563
Community Health Systems, Inc. 6.5% 12/15/12 (f)		60,000		60,450
HCA, Inc. 6.375% 1/15/15		70,000		70,150
IASIS Healthcare LLC/IASIS Capital Corp. 8.75% 6/15/14		130,000		141,869
National Nephrology Associates, Inc. 9% 11/1/11 (f)		30,000		34,725
Psychiatric Solutions, Inc. 10.625% 6/15/13		45,000		52,088
Rotech Healthcare, Inc. 9.5% 4/1/12		75,000		82,125
Tenet Healthcare Corp.:
6.375% 12/1/11		65,000		59,800
7.375% 2/1/13		150,000		146,250
9.875% 7/1/14 (f)		70,000		76,125
U.S. Oncology, Inc.:
9% 8/15/12 (f)		170,000		187,850
10.75% 8/15/14 (f)		50,000		57,250
				1,080,245
Pharmaceuticals - 0.1%
Elan Finance PLC/Elan Finance Corp. 7.75% 11/15/11 (f)		160,000		171,200
TOTAL HEALTH CARE				1,251,445
INDUSTRIALS - 0.8%
Aerospace & Defense - 0.1%
BE Aerospace, Inc.:
8% 3/1/08		65,000		65,000
8.875% 5/1/11		25,000		26,125
Bombardier, Inc. 6.3% 5/1/14 (f)		200,000		173,500
Raytheon Co. 8.3% 3/1/10		150,000		177,749
				442,374

		Principal Amount		Value (Note 1)
Airlines - 0.3%
American Airlines, Inc. pass thru trust certificates:
6.817% 5/23/11		$ 115,000		$ 108,100
7.377% 5/23/19		95,503		66,852
7.379% 5/23/16		67,347		47,143
7.8% 4/1/08		50,000		46,500
8.608% 10/1/12		75,000		70,125
10.18% 1/2/13		45,000		35,100
Continental Airlines, Inc. pass thru trust certificates:
6.9% 7/2/18		18,985		15,947
7.568% 12/1/06		20,000		16,200
8.312% 10/2/12		20,167		15,529
8.321% 11/1/06		10,000		9,700
Delta Air Lines, Inc. 9.5% 11/18/08 (f)		19,000		17,813
Delta Air Lines, Inc. pass thru trust certificates:
7.299% 9/18/06		1,000		800
7.57% 11/18/10		45,000		44,388
7.779% 1/2/12		354,807		230,625
7.92% 5/18/12		75,000		57,750
Northwest Airlines, Inc. 7.875% 3/15/08		255,000		206,550
Northwest Airlines, Inc. pass thru trust certificates:
7.068% 7/2/17		24,306		21,876
7.626% 4/1/10		72,130		59,868
7.67% 1/2/15		21,263		18,552
				1,089,418
Building Products - 0.1%
Building Materials Corp. of America 7.75% 8/1/14 (f)		80,000		80,000
Mueller Group, Inc. 6.91% 11/1/11 (h)		80,000		82,800
Nortek, Inc. 8.5% 9/1/14 (f)		90,000		94,050
				256,850
Commercial Services & Supplies - 0.1%
Allied Waste North America, Inc.:
5.75% 2/15/11		40,000		37,600
6.375% 4/15/11		40,000		38,000
7.625% 1/1/06		30,000		30,975
				106,575
Machinery - 0.2%
Cummins, Inc. 9.5% 12/1/10 (h)		50,000		56,500
Dresser-Rand Group, Inc. 7.375% 11/1/14 (f)		40,000		40,700
Invensys PLC 9.875% 3/15/11 (f)		180,000		194,400
Park-Ohio Industries, Inc. 8.375% 11/15/14 (f)		40,000		39,900
Corporate Bonds - continued
		Principal Amount		Value (Note 1)
Nonconvertible Bonds - continued
INDUSTRIALS - continued
Machinery - continued
Terex Corp.:
7.375% 1/15/14		$ 20,000		$ 21,300
9.25% 7/15/11		195,000		218,888
				571,688
Marine - 0.0%
H-Lines Finance Holding Corp. 0% 4/1/13 (d)(f)		30,000		21,825
OMI Corp. 7.625% 12/1/13		45,000		48,150
				69,975
Road & Rail - 0.0%
TFM SA de CV yankee:
10.25% 6/15/07		20,000		21,400
11.75% 6/15/09		60,000		60,900
				82,300
TOTAL INDUSTRIALS				2,619,180
INFORMATION TECHNOLOGY - 0.4%
Communications Equipment - 0.1%
L-3 Communications Corp. 6.125% 1/15/14		70,000		72,100
Lucent Technologies, Inc.:
6.45% 3/15/29		70,000		63,700
6.5% 1/15/28		30,000		27,000
Nortel Networks Corp. 6.125% 2/15/06		80,000		81,700
				244,500
Electronic Equipment & Instruments - 0.1%
Celestica, Inc. 7.875% 7/1/11		200,000		214,000
Flextronics International Ltd. 6.5% 5/15/13		20,000		20,400
Sanmina-SCI Corp. 10.375% 1/15/10		85,000		97,325
Solectron Corp. 7.375% 3/1/06		115,000		118,594
				450,319
IT Services - 0.0%
Iron Mountain, Inc. 6.625% 1/1/16		50,000		46,750
Office Electronics - 0.0%
Xerox Corp.:
7.125% 6/15/10		60,000		64,800
7.625% 6/15/13		70,000		77,000
				141,800
Semiconductors & Semiconductor Equipment - 0.2%
Freescale Semiconductor, Inc.:
4.82% 7/15/09 (h)		70,000		73,150
6.875% 7/15/11		80,000		85,800

		Principal Amount		Value (Note 1)
7.125% 7/15/14		$ 80,000		$ 86,800
MagnaChip Semiconductor SA/MagnaChip Semiconductor Finance Co.:
5.78% 12/15/11 (f)(h)		30,000		30,788
6.875% 12/15/11 (f)		40,000		41,200
8% 12/15/14 (f)		20,000		20,850
Semiconductor Note Participation Trust 0% 8/4/11 (f)		105,000		157,500
Viasystems, Inc. 10.5% 1/15/11		80,000		78,400
				574,488
TOTAL INFORMATION TECHNOLOGY				1,457,857
MATERIALS - 1.1%
Chemicals - 0.3%
America Rock Salt Co. LLC 9.5% 3/15/14		50,000		52,250
Berry Plastics Corp. 10.75% 7/15/12		60,000		68,550
Equistar Chemicals LP/Equistar Funding Corp. 10.625% 5/1/11		110,000		127,050
Huntsman Advanced Materials LLC 11% 7/15/10 (f)		40,000		47,000
Huntsman ICI Holdings LLC 0% 12/31/09		55,000		31,075
Huntsman International LLC 9.875% 3/1/09		60,000		65,700
JohnsonDiversey Holdings, Inc. 0% 5/15/13 (d)		45,000		38,925
Lubrizol Corp.:
4.625% 10/1/09		80,000		79,877
5.5% 10/1/14		35,000		35,206
6.5% 10/1/34		65,000		66,200
Lyondell Chemical Co.:
9.5% 12/15/08		25,000		27,250
9.625% 5/1/07		30,000		32,925
Methanex Corp. yankee 7.75% 8/15/05		155,000		158,875
Millennium America, Inc. 9.25% 6/15/08		70,000		79,100
Nalco Co. 7.75% 11/15/11		50,000		53,875
PolyOne Corp.:
8.875% 5/1/12		45,000		49,050
10.625% 5/15/10		25,000		28,125
The Scotts Co. 6.625% 11/15/13		50,000		52,750
				1,093,783
Construction Materials - 0.1%
RMCC Acquisition Co. 9.5% 11/1/12 (f)		180,000		177,300
Texas Industries, Inc. 10.25% 6/15/11		140,000		165,200
U.S. Concrete, Inc. 8.375% 4/1/14		50,000		53,750
				396,250
Corporate Bonds - continued
		Principal Amount		Value (Note 1)
Nonconvertible Bonds - continued
MATERIALS - continued
Containers & Packaging - 0.3%
Anchor Glass Container Corp. 11% 2/15/13		$ 60,000		$ 65,100
BWAY Corp. 10% 10/15/10		40,000		42,600
Cellu Tissue Holdings, Inc. 9.75% 3/15/10		60,000		62,400
Crown European Holdings SA 10.875% 3/1/13		80,000		94,600
Jefferson Smurfit Corp. U.S. 7.5% 6/1/13		130,000		139,100
Owens-Brockway Glass Container, Inc.:
6.75% 12/1/14 (f)		50,000		51,000
7.75% 5/15/11		50,000		54,250
8.75% 11/15/12		25,000		28,063
8.875% 2/15/09		95,000		103,075
Owens-Illinois, Inc.:
7.35% 5/15/08		295,000		311,225
7.8% 5/15/18		45,000		46,575
Sealed Air Corp. 5.625% 7/15/13 (f)		30,000		31,036
				1,029,024
Metals & Mining - 0.2%
Allegheny Technologies, Inc. 8.375% 12/15/11		45,000		49,950
California Steel Industries, Inc. 6.125% 3/15/14		60,000		59,550
Compass Minerals International, Inc. 0% 12/15/12 (d)		80,000		68,400
CSN Islands VIII Corp. 9.75% 12/16/13 (f)		100,000		107,000
Foundation Pennsylvania Coal Co. 7.25% 8/1/14 (f)		50,000		52,875
IMCO Recycling Escrow, Inc. 9% 11/15/14 (f)		55,000		56,925
International Steel Group, Inc. 6.5% 4/15/14		85,000		91,800
Ispat Inland ULC 9.75% 4/1/14		45,000		55,575
Massey Energy Co. 6.625% 11/15/10		40,000		41,600
Wise Metals Group LLC/Alloys Finance 10.25% 5/15/12		160,000		160,000
				743,675
Paper & Forest Products - 0.2%
Boise Cascade LLC/Boise Cascade Finance Corp. 7.125% 10/15/14 (f)		30,000		31,500
Georgia-Pacific Corp.:
7.5% 5/15/06		120,000		125,700
8% 1/15/24		80,000		92,700
8.125% 5/15/11		120,000		138,000

		Principal Amount		Value (Note 1)
International Paper Co.:
4.25% 1/15/09		$ 35,000		$ 35,128
5.5% 1/15/14		95,000		98,136
Norske Skog Canada Ltd. 8.625% 6/15/11		150,000		160,500
				681,664
TOTAL MATERIALS				3,944,396
TELECOMMUNICATION SERVICES - 1.5%
Diversified Telecommunication Services - 1.1%
AT&T Broadband Corp. 8.375% 3/15/13		100,000		123,310
Bellsouth Capital Funding Corp. 7.875% 2/15/30		115,000		143,237
BellSouth Corp. 5.2% 9/15/14		100,000		101,922
British Telecommunications PLC 8.875% 12/15/30		200,000		267,804
Deutsche Telekom International Finance BV 8.75% 6/15/30		250,000		330,115
France Telecom SA:
8.5% 3/1/11		105,000		125,255
9.5% 3/1/31		200,000		271,118
Koninklijke KPN NV yankee 8% 10/1/10		200,000		236,068
New Skies Satellites BV 7.4375% 11/1/11 (f)(h)		90,000		94,500
NTL Cable PLC 8.75% 4/15/14 (f)		45,000		50,625
Primus Telecommunications Group, Inc. 8% 1/15/14		60,000		52,800
Qwest Capital Funding, Inc.:
7% 8/3/09		60,000		59,400
7.75% 8/15/06		270,000		284,175
Qwest Communications International, Inc.:
7.25% 2/15/11 (f)		20,000		20,400
7.5% 2/15/14 (f)		120,000		121,200
Qwest Corp. 9.125% 3/15/12 (f)		85,000		98,175
Qwest Services Corp. 14% 12/15/10 (f)(h)		75,000		90,000
SBC Communications, Inc.:
6.15% 9/15/34		150,000		154,482
6.45% 6/15/34		100,000		107,137
Sprint Capital Corp. 6.875% 11/15/28		145,000		158,744
Telecom Italia Capital:
4.95% 9/30/14 (f)		95,000		93,075
5.25% 11/15/13		250,000		252,684
Telefonica Europe BV 7.75% 9/15/10		105,000		123,132
Verizon Global Funding Corp.:
7.25% 12/1/10		240,000		274,965
7.75% 12/1/30		200,000		248,665
				3,882,988
Corporate Bonds - continued
		Principal Amount		Value (Note 1)
Nonconvertible Bonds - continued
TELECOMMUNICATION SERVICES - continued
Wireless Telecommunication Services - 0.4%
America Movil SA de CV:
4.125% 3/1/09		$ 100,000		$ 98,514
5.5% 3/1/14		90,000		88,911
American Tower Corp. 9.375% 2/1/09		28,000		29,400
AT&T Wireless Services, Inc. 7.875% 3/1/11		55,000		64,824
Centennial Communications Corp./Centennial Cellular Operating Co. LLC/Centennial Puerto Rico Operations Corp. 8.125% 2/1/14 (h)		80,000		82,400
Crown Castle International Corp.:
Series B, 7.5% 12/1/13		80,000		85,800
10.75% 8/1/11		15,000		16,350
DirecTV Holdings LLC/DirecTV Financing, Inc. 8.375% 3/15/13		50,000		56,000
Inmarsat Finance PLC 7.625% 6/30/12		50,000		52,000
Intelsat Ltd.:
6.5% 11/1/13		55,000		49,775
7.625% 4/15/12		15,000		14,775
Millicom International Cellular SA 10% 12/1/13 (f)		80,000		83,600
Nextel Communications, Inc. 7.375% 8/1/15		160,000		176,800
Nextel Partners, Inc. 8.125% 7/1/11		80,000		88,800
Rogers Communications, Inc.:
5.525% 12/15/10 (f)(h)		50,000		52,375
6.375% 3/1/14		115,000		113,850
7.25% 12/15/12 (f)		30,000		31,800
7.5% 3/15/15 (f)		70,000		73,675
8% 12/15/12 (f)		40,000		42,200
9.625% 5/1/11		40,000		46,600
Western Wireless Corp. 9.25% 7/15/13		100,000		109,000
				1,457,449
TOTAL TELECOMMUNICATION SERVICES				5,340,437
UTILITIES - 1.6%
Electric Utilities - 0.6%
Allegheny Energy Supply Co. LLC 8.25% 4/15/12 (f)		170,000		191,463
Cleveland Electric Illuminating Co. 5.65% 12/15/13		145,000		150,381
Duke Capital LLC:
4.37% 3/1/09		400,000		402,602
6.75% 2/15/32		210,000		228,524
Exelon Corp. 6.75% 5/1/11		200,000		223,725

		Principal Amount		Value (Note 1)
FirstEnergy Corp. 6.45% 11/15/11		$ 25,000		$ 27,162
Illinois Power Co. 7.5% 6/15/09		155,000		174,820
Nevada Power Co.:
5.875% 1/15/15 (f)		30,000		30,075
10.875% 10/15/09		65,000		75,075
Niagara Mohawk Power Corp. 8.875% 5/15/07		75,000		83,300
Progress Energy, Inc. 7.1% 3/1/11		270,000		303,546
Sierra Pacific Power Co. 6.25% 4/15/12		30,000		31,275
TECO Energy, Inc.:
6.125% 5/1/07		55,000		56,925
10.5% 12/1/07		105,000		121,538
Texas Genco LLC/Texas Genco Financing Corp. 6.875% 12/15/14 (f)		60,000		62,400
				2,162,811
Gas Utilities - 0.2%
Consolidated Natural Gas Co. 6.85% 4/15/11		70,000		78,997
Dynegy Holdings, Inc. 10.125% 7/15/13 (f)		50,000		57,000
NiSource Finance Corp. 7.875% 11/15/10		230,000		270,383
Sonat, Inc.:
6.625% 2/1/08		65,000		65,813
6.75% 10/1/07		70,000		73,500
7.625% 7/15/11		20,000		20,625
Southern Natural Gas Co. 8.875% 3/15/10		40,000		44,750
Texas Eastern Transmission Corp. 7.3% 12/1/10		185,000		212,519
Transcontinental Gas Pipe Line Corp. 6.125% 1/15/05		20,000		20,100
				843,687
Multi-Utilities & Unregulated Power - 0.8%
AES Corp.:
8.5% 11/1/07		19,000		19,310
8.75% 6/15/08		30,000		32,700
8.75% 5/15/13 (f)		170,000		192,525
8.875% 2/15/11		54,000		61,695
9% 5/15/15 (f)		90,000		102,938
9.375% 9/15/10		16,000		18,500
9.5% 6/1/09		144,000		163,620
Calpine Corp.:
7.82% 7/15/07 (f)(h)		79,000		71,890
8.5% 7/15/10 (f)		20,000		17,100
CMS Energy Corp.:
7.75% 8/1/10		125,000		136,719
8.5% 4/15/11		85,000		96,581
8.9% 7/15/08		125,000		137,969
9.875% 10/15/07		105,000		117,075
Corporate Bonds - continued
		Principal Amount		Value (Note 1)
Nonconvertible Bonds - continued
UTILITIES - continued
Multi-Utilities & Unregulated Power - continued
Constellation Energy Group, Inc. 7% 4/1/12		$ 350,000		$ 398,948
Dominion Resources, Inc.:
6.25% 6/30/12		685,000		747,875
8.125% 6/15/10		60,000		70,622
NRG Energy, Inc. 8% 12/15/13 (f)		120,000		130,950
Reliant Energy, Inc.:
6.75% 12/15/14		70,000		70,000
9.25% 7/15/10		30,000		33,600
9.5% 7/15/13		10,000		11,375
				2,631,992
TOTAL UTILITIES				5,638,490
TOTAL NONCONVERTIBLE BONDS				40,841,405
TOTAL CORPORATE BONDS (Cost $38,686,197)			41,221,955
U.S. Government and Government Agency Obligations - 10.0%

U.S. Government Agency Obligations - 2.3%
Fannie Mae:
2.5% 6/15/06		410,000		406,381
3.25% 8/15/08		550,000		542,751
3.25% 2/15/09		1,216,000		1,192,355
5.5% 3/15/11		380,000		407,493
6% 5/15/11		2,015,000		2,216,897
6.25% 2/1/11		280,000		306,968
Freddie Mac:
3.625% 9/15/08		318,000		318,109
4% 6/12/13		1,575,000		1,504,262
6.625% 9/15/09		475,000		531,212
6.75% 3/15/31		404,000		491,010
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS				7,917,438
U.S. Treasury Inflation Protected Obligations - 1.2%
U.S. Treasury Inflation-Indexed Bonds 2.375% 1/15/25		1,012,580		1,082,788

		Principal Amount		Value (Note 1)
U.S. Treasury Inflation-Indexed Notes:
0.875% 4/15/10		$ 1,007,510		$ 997,710
2% 1/15/14		2,065,960		2,138,269
TOTAL U.S. TREASURY INFLATION PROTECTED OBLIGATIONS				4,218,767
U.S. Treasury Obligations - 6.5%
U.S. Treasury Bonds 6.25% 5/15/30		275,000		328,786
U.S. Treasury Notes:
1.625% 2/28/06		15,370,000		15,161,660
3.125% 5/15/07		200,000		199,898
3.125% 4/15/09		800,000		787,875
4.75% 5/15/14		2,105,000		2,193,639
6.5% 2/15/10		1,220,000		1,381,221
7% 7/15/06		2,600,000		2,756,608
TOTAL U.S. TREASURY OBLIGATIONS				22,809,687
TOTAL U.S. GOVERNMENT AND GOVERNMENT AGENCY OBLIGATIONS (Cost $34,957,848)			34,945,892
U.S. Government Agency - Mortgage Securities - 8.9%

Fannie Mae - 8.4%
3.836% 6/1/33 (h)		17,022		17,035
3.941% 10/1/34 (h)		24,543		24,719
4.021% 12/1/34 (h)		25,000		25,148
4.037% 12/1/34 (h)		24,825		25,031
4.048% 1/1/35 (h)		25,000		25,182
4.072% 12/1/34 (h)		25,000		25,195
4.105% 1/1/35 (h)		50,000		49,809
4.17% 11/1/34 (h)		24,998		25,134
4.324% 12/1/34 (h)		24,999		25,405
4.5% 1/1/20 (g)		2,000,000		1,991,875
4.5% 1/1/20 (g)		50,000		49,797
4.5% 7/1/33 to 10/1/33		3,893,403		3,769,926
4.549% 8/1/34 (h)		46,664		47,760
5% 11/1/17 to 8/1/18		4,374,587		4,448,907
5% 1/1/35 (g)		3,000,000		2,973,750
5% 1/1/35 (g)		1,275,000		1,263,844
5.5% 2/1/11 to 6/1/29		1,368,049		1,412,583
5.5% 1/1/35 (g)		3,935,130		3,990,468
5.5% 1/1/35 (g)		4,000,000		4,056,250
6% 4/1/09 to 1/1/29		1,557,236		1,631,715
6% 1/1/35 (g)		299,817		309,748
6.5% 5/1/11 to 7/1/32		2,374,873		2,500,094
6.5% 1/1/20 (g)		54,792		58,080
U.S. Government Agency - Mortgage Securities - continued
		Principal Amount		Value (Note 1)
Fannie Mae - continued
7% 12/1/24 to 2/1/28		$ 131,621		$ 140,237
7.5% 10/1/26 to 8/1/28		440,456		472,564
TOTAL FANNIE MAE				29,360,256
Freddie Mac - 0.0%
4.985% 8/1/33 (h)		25,000		25,678
7.5% 1/1/27		32,697		35,120
TOTAL FREDDIE MAC				60,798
Government National Mortgage Association - 0.5%
6.5% 10/15/27 to 9/15/32		844,073		890,137
7% 1/15/28 to 7/15/32		495,343		526,572
7.5% 6/15/27 to 3/15/28		138,250		148,713
TOTAL GOVERNMENT NATIONAL MORTGAGE ASSOCIATION				1,565,422
TOTAL U.S. GOVERNMENT AGENCY - MORTGAGE SECURITIES (Cost $30,788,615)			30,986,476
Asset-Backed Securities - 0.9%

ACE Securities Corp. Series 2004-HE1:
Class M1, 2.9175% 2/25/34 (h)		50,000		50,008
Class M2, 3.5175% 2/25/34 (h)		50,000		50,018
American Express Credit Account Master Trust Series 2001-6 Class B, 2.7525% 12/15/08 (h)		200,000		200,600
Ameriquest Mortgage Securities, Inc. Series 2004-R2:
Class M1, 2.8475% 4/25/34 (h)		25,000		25,000
Class M2, 2.8975% 4/25/34 (h)		25,000		25,000
Amortizing Residential Collateral Trust Series 2003-BC1 Class M2, 3.5175% 1/25/32 (h)		45,000		45,186
Argent Securities, Inc. Series 2004-W5 Class M1, 3.0175% 4/25/34 (h)		75,000		75,100
Capital One Multi-Asset Execution Trust:
Series 2003-B4 Class B4, 3.2025% 7/15/11 (h)		105,000		106,913
Series 2004-6 Class B, 4.15% 7/16/12		125,000		124,866
Chase Manhattan Auto Owner Trust Series 2001-A Class A4, 5.07% 2/15/08		239,196		240,194
Citibank Credit Card Issuance Trust Series 2002-C1 Class C1, 3.2% 2/9/09 (h)		250,000		253,336

		Principal Amount		Value (Note 1)
Countrywide Home Loans, Inc.:
Series 2004-2 Class M1, 2.9175% 5/25/34 (h)		$ 100,000		$ 100,002
Series 2004-3 Class M1, 2.9175% 6/25/34 (h)		25,000		25,026
Series 2004-4:
Class A, 2.7875% 8/25/34 (h)		80,984		80,956
Class M1, 2.8975% 7/25/34 (h)		75,000		75,158
Class M2, 2.9475% 6/25/34 (h)		80,000		80,191
Discover Card Master Trust I:
Series 2001-6 Class A, 5.75% 12/15/08		600,000		621,227
Series 2003-4 Class B1, 2.7325% 5/16/11 (h)		155,000		155,826
Fremont Home Loan Trust Series 2004-A:
Class M1, 2.9675% 1/25/34 (h)		75,000		75,001
Class M2, 3.5675% 1/25/34 (h)		100,000		100,002
Home Equity Asset Trust Series 2002-4 Class M2, 4.4675% 3/25/33 (h)		25,000		25,371
MBNA Credit Card Master Note Trust Series 2001-A1 Class A1, 5.75% 10/15/08		200,000		206,739
Meritage Mortgage Loan Trust Series 2004-1:
Class M1, 2.9175% 7/25/34 (h)		50,000		50,001
Class M3, 3.3675% 7/25/34 (h)		25,000		25,000
Morgan Stanley ABS Capital I, Inc.:
Series 2003-HE1 Class M2, 4.3175% 5/25/33 (h)		25,000		25,349
Series 2003-NC5 Class M2, 4.4175% 4/25/33 (h)		50,000		50,924
Morgan Stanley Dean Witter Capital I Trust Series 2003-NC1 Class M1, 3.4675% 11/25/32 (h)		45,000		45,478
Sears Credit Account Master Trust II Series 2000-2 Class A, 6.75% 9/16/09		365,000		374,114
Structured Asset Securities Corp. Series 2004-GEL1 Class A, 2.7775% 2/25/34 (h)		31,853		31,854
TOTAL ASSET-BACKED SECURITIES (Cost $3,298,664)			3,344,440
Collateralized Mortgage Obligations - 0.4%
		Principal Amount		Value (Note 1)
Private Sponsor - 0.0%
CS First Boston Mortgage Securities Corp. floater Series 2004-AR3 Class 6A2, 2.7875% 4/25/34 (h)		$ 68,523		$ 68,624
Master Alternative Loan Trust Series 2004-3 Class 3A1, 6% 4/25/34		22,382		22,913
Residential Asset Mortgage Products, Inc. sequential pay Series 2004-SL2 Class A1, 6.5% 10/25/16		38,090		39,125
TOTAL PRIVATE SPONSOR				130,662
U.S. Government Agency - 0.4%
Fannie Mae guaranteed REMIC pass thru certificates planned amortization class Series 2004-81 Class KD:
4.5% 4/25/17		380,000		382,294
4.5% 7/25/18		170,000		168,639
Freddie Mac Multi-class participation certificates guaranteed planned amortization class:
Series 2677 Class LD, 4.5% 3/15/17		560,000		559,802
Series 2885 Class PC, 4.5% 3/15/18		165,000		165,958
TOTAL U.S. GOVERNMENT AGENCY				1,276,693
TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS (Cost $1,411,824)			1,407,355
Commercial Mortgage Securities - 1.2%

Bayview Commercial Asset Trust floater:
Series 2004-1 Class A, 2.7775% 4/25/34 (f)(h)		92,980		92,697
Series 2004-3 Class A1, 2.7675% 1/25/35 (f)(h)		149,743		149,743
COMM:
floater:
Series 2002-FL7 Class D, 2.9725% 11/15/14 (f)(h)		45,000		45,121
Series 2003-FL9 Class B, 2.9025% 11/15/15 (f)(h)		85,741		85,997
Series 2004-LBN2 Class X2, 1.2743% 3/10/39 (f)(h)(i)		314,195		13,398
CS First Boston Mortgage Securities Corp.:
sequential pay:
Series 1999-C1 Class A2, 7.29% 9/15/41		250,000		280,656

		Principal Amount		Value (Note 1)
Series 2000-C1 Class A2, 7.545% 4/15/62		$ 500,000		$ 570,857
Series 2004-C1 Class A3, 4.321% 1/15/37		95,000		94,428
Series 1997-C2 Class D, 7.27% 1/17/35		150,000		165,774
Series 2004-C1 Class ASP, 1.0446% 1/15/37 (f)(h)(i)		1,540,000		61,591
DLJ Commercial Mortgage Corp. sequential pay Series 2000-CF1 Class A1B, 7.62% 6/10/33		500,000		573,195
Fannie Mae sequential pay Series 1999-10 Class MZ, 6.5% 9/17/38		248,127		262,803
GS Mortgage Securities Corp. II:
sequential pay:
Series 2001-LIBA Class A2, 6.615% 2/14/16 (f)		105,000		115,643
Series 2003-C1 Class A2A, 3.59% 1/10/40		125,000		124,418
Series 1998-GLII Class E, 7.1905% 4/13/31 (h)		120,000		125,956
J.P. Morgan Commercial Mortgage Finance Corp. sequential pay Series 2000-C9 Class A2, 7.77% 10/15/32		225,000		257,901
Leafs CMBS I Ltd./Leafs CMBS I Corp. Series 2002-1A:
Class B, 4.13% 11/20/37 (f)		110,000		105,076
Class C, 4.13% 11/20/37 (f)		110,000		100,375
Merrill Lynch Mortgage Trust sequential pay Series 2004-KEY2 Class A2, 4.166% 8/12/39		215,000		214,202
Morgan Stanley Capital I, Inc. sequential pay Series 2004-HQ3 Class A2, 4.05% 1/13/41		105,000		104,217
Thirteen Affiliates of General Growth Properties, Inc. sequential pay Series 1 Class A2, 6.602% 11/15/07 (f)		500,000		532,438
Wachovia Bank Commercial Mortgage Trust sequential pay Series 2003-C6 Class A2, 4.498% 8/15/35		165,000		167,348
TOTAL COMMERCIAL MORTGAGE SECURITIES (Cost $4,038,439)			4,243,834
Foreign Government and Government Agency Obligations - 0.4%

Chilean Republic:
5.625% 7/23/07		150,000		157,031
7.125% 1/11/12		190,000		218,144
Korean Republic 4.875% 9/22/14		100,000		98,911
State of Israel 4.625% 6/15/13		30,000		28,669
United Mexican States:
5.875% 1/15/14		90,000		92,205
Foreign Government and Government Agency Obligations - continued
		Principal Amount		Value (Note 1)
United Mexican States: - continued
6.375% 1/16/13		$ 300,000		$ 319,500
6.75% 9/27/34		150,000		148,125
7.5% 4/8/33		175,000		189,000
TOTAL FOREIGN GOVERNMENT AND GOVERNMENT AGENCY OBLIGATIONS (Cost $1,201,314)			1,251,585
Floating Rate Loans - 0.1%

TELECOMMUNICATION SERVICES - 0.1%
Diversified Telecommunication Services - 0.1%
Qwest Corp. Tranche A, term loan 7.39% 6/30/07 (h)		190,000		198,075
UTILITIES - 0.0%
Multi-Utilities & Unregulated Power - 0.0%
AES Corp. term loan 5.22% 8/10/11 (h)		85,714		86,893
TOTAL FLOATING RATE LOANS (Cost $276,110)			284,968
Money Market Funds - 15.2%
		Shares
Fidelity Cash Central Fund, 2.24% (b)		50,175,503		50,175,503
Fidelity Securities Lending Cash Central Fund, 2.23% (b)(c)		2,822,275		2,822,275
TOTAL MONEY MARKET FUNDS (Cost $52,997,778)			52,997,778
Cash Equivalents - 0.0%
		Maturity Amount
Investments in repurchase agreements (Collateralized by U.S. Treasury Obligations, in a joint trading account at 1.52%, dated 12/31/04 due 1/3/05) (Cost $42,000)		$ 42,005		$ 42,000
TOTAL INVESTMENT PORTFOLIO - 104.8% (Cost $330,019,447)				366,188,686
NET OTHER ASSETS - (4.8)%				(16,764,900)
NET ASSETS - 100%			$ 349,423,786

Swap Agreements
	Expiration Date	Notional Amount	Value
Interest Rate Swap
Receive quarterly a fixed rate equal to 3.524% and pay quarterly a floating rate based on 3-month LIBOR with Morgan Stanley, Inc.	May 2007	$ 2,800,000	$ 4,197
TOTAL INTEREST RATE SWAP		2,800,000	4,197
Total Return Swap
Receive monthly a return equal to Lehman Brothers for CMBS U.S. Aggregate Index and pay monthly a floating rate based on 1-month LIBOR with Deutsche Bank	June 2005	570,000	3,247
Receive monthly a return equal to Lehman Brothers for CMBS U.S. Aggregate Index and pay monthly a floating rate based on 1-month LIBOR with Goldman Sachs	March 2005	1,430,000	7,555
Receive monthly a return equal to Lehman Brothers for CMBS AAA 8.5+ Index and pay monthly a floating rate based on 1-month LIBOR minus 40 basis points with Lehman Brothers, Inc.	April 2005	500,000	5,171
Receive monthly a return equal to Lehman Brothers for CMBS U.S. Aggregate Index and pay monthly a floating rate based on 1-month LIBOR minus 10 basis points with Lehman Brothers, Inc.	May 2005	2,500,000	13,044
Receive quarterly a return equal to Banc of America Securities LLC AAA 10Yr Commercial Mortgage-Backed Securities Daily Index and pay quarterly a floating rate based on 3-month LIBOR minus 72 basis points with Bank of America	Jan. 2005	500,000	(1,735)
Swap Agreements - continued
	Expiration Date	Notional Amount	Value
Total Return Swap - continued
Receive quarterly a return equal to that of Banc of America Securities LLC AAA 10Yr Commercial Mortgage Backed Securities Daily Index and pay quarterly a floating rate based on 3-month LIBOR minus 30 basis points with Bank of America	May 2005	$ 500,000	$ (556)
Receive quarterly a return equal to that of Lehman Brothers Commercial Mortgage-Backed Securities AAA Daily Index and pay quarterly a floating rate based on 3-month LIBOR minus 8 basis points with Bank of America	April 2005	490,000	(3,013)
TOTAL TOTAL RETURN SWAP		6,490,000	23,713
		$ 9,290,000	$ 27,910

Legend

(a) Non-income producing

(d) Debt obligation initially issued in zero coupon form which converts to coupon form at a specified rate and date. The rate shown is the rate at period end.

(e) Security or a portion of the security is on loan at period end.

(f) Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At the period end, the value of these securities amounted to $8,715,733 or 2.5% of net assets.

(g) Security or a portion of the security purchased on a delayed delivery or when-issued basis.

(h) The coupon rate shown on floating or adjustable rate securities represents the rate at period end.

(i) Security represents right to receive monthly interest payments on an underlying pool of mortgages. Principal shown is the par amount of the mortgage pool.

Other Information

The composition of credit quality ratings as a percentage of net assets is as follows (ratings are unaudited):

U.S.Government and U.S.Government Agency Obligations	19.4%
AAA,AA,A	4.2%
BBB	3.8%
BB	1.8%
B	3.8%
CCC,CC,C	0.5%
Not Rated	0.2%
Equities	55.9%
Short-Term Investments and Net Other Assets	10.4%
	100.0%

We have used ratings from Moody's® Investors Services, Inc.
Where Moody's ratings are not available, we have used S&P® ratings.

Income Tax Information

At December 31, 2004, the fund had a capital loss carryforward of approximately $11,446,000 of which $1,788,000 and $9,658,000 will expire on December 31, 2009 and 2010, respectively.

See accompanying notes which are an integral part of the financial statements.

Balanced Portfolio

Fidelity Variable Insurance Products: Balanced Portfolio

Financial Statements

Statement of Assets and Liabilities

	December 31, 2004

Assets
Investment in securities, at value (including securities loaned of $2,743,680 and repurchase agreements of $42,000) (cost $330,019,447) - See accompanying schedule		$ 366,188,686
Cash		806
Receivable for fund shares sold		68,544
Dividends receivable		176,836
Interest receivable		1,293,331
Swap agreements, at value		27,910
Prepaid expenses		1,322
Other receivables		13,937
Total assets		367,771,372

Liabilities
Payable for investments purchased Regular delivery	$ 317,217
Delayed delivery	14,753,084
Payable for fund shares redeemed	219,642
Accrued management fee	123,028
Distribution fees payable	9,420
Other affiliated payables	31,431
Other payables and accrued expenses	71,489
Collateral on securities loaned, at value	2,822,275
Total liabilities		18,347,586

Net Assets		$ 349,423,786
Net Assets consist of:
Paid in capital		$ 316,130,162
Undistributed net investment income		9,092,580
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions		(11,996,105)
Net unrealized appreciation (depreciation) on investments		36,197,149
Net Assets		$ 349,423,786

Initial Class: Net Asset Value, offering price and redemption price per share ($291,175,630 ÷ 20,297,277 shares)		$ 14.35

Service Class: Net Asset Value, offering price and redemption price per share ($21,227,681 ÷ 1,487,026 shares)		$ 14.28

Service Class 2: Net Asset Value, offering price and redemption price per share ($37,020,475 ÷ 2,606,181 shares)		$ 14.20

Statement of Operations

	Year ended December 31, 2004

Investment Income
Dividends		$ 3,518,465
Special Dividends		761,100
Interest		6,666,531
Security lending		3,282
Total income		10,949,378

Expenses
Management fee	$ 1,470,347
Transfer agent fees	238,939
Distribution fees	103,770
Accounting and security lending fees	144,610
Non-interested trustees' compensation	1,905
Custodian fees and expenses	21,654
Audit	46,946
Legal	894
Miscellaneous	30,857
Total expenses before reductions	2,059,922
Expense reductions	(13,464)	2,046,458
Net investment income (loss)		8,902,920
Realized and Unrealized Gain (Loss) Net realized gain (loss) on:
Investment securities	8,330,480
Foreign currency transactions	(1,576)
Swap agreements	251,460
Total net realized gain (loss)		8,580,364
Change in net unrealized appreciation (depreciation) on: Investment securities	592,685
Swap agreements	(18,253)
Delayed delivery commitments	(464)
Total change in net unrealized appreciation (depreciation)		573,968
Net gain (loss)		9,154,332
Net increase (decrease) in net assets resulting from operations		$ 18,057,252

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products: Balanced Portfolio
Financial Statements - continued

Statement of Changes in Net Assets

	Year ended December 31, 2004	Year ended December 31, 2003
Increase (Decrease) in Net Assets
Operations
Net investment income (loss)	$ 8,902,920	$ 6,987,022
Net realized gain (loss)	8,580,364	3,062,346
Change in net unrealized appreciation (depreciation)	573,968	38,999,107
Net increase (decrease) in net assets resulting from operations	18,057,252	49,048,475
Distributions to shareholders from net investment income	(6,988,389)	(7,974,845)
Share transactions - net increase (decrease)	(8,689,636)	32,311,069
Total increase (decrease) in net assets	2,379,227	73,384,699

Net Assets
Beginning of period	347,044,559	273,659,860
End of period (including undistributed net investment income of $9,092,580 and undistributed net investment income of $7,087,612, respectively)	$ 349,423,786	$ 347,044,559

Other Information:
Share Transactions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2
Shares Sold	2,035,766	95,487	798,702
Reinvested	432,646	31,049	40,193
Redeemed	(3,476,835)	(224,978)	(377,301)
Net increase (decrease)	(1,008,423)	(98,442)	461,594

Dollars Sold	$ 28,145,848	$ 1,311,596	$ 10,871,355
Reinvested	6,005,122	429,413	553,854
Redeemed	(47,800,698)	(3,078,714)	(5,127,412)
Net increase (decrease)	$ (13,649,728)	$ (1,337,705)	$ 6,297,797

Share Transactions	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2
Shares Sold	4,747,709	87,816	932,305
Reinvested	599,512	50,167	45,486
Redeemed	(3,372,673)	(205,767)	(374,801)
Net increase (decrease)	1,974,548	(67,784)	602,990

Dollars Sold	$ 61,609,403	$ 1,115,888	$ 11,910,142
Reinvested	6,882,396	573,909	518,540
Redeemed	(42,908,423)	(2,600,420)	(4,790,366)
Net increase (decrease)	$ 25,583,376	$ (910,623)	$ 7,638,316

Distributions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2
From net investment income	$ 6,005,122	$ 429,413	$ 553,854
	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2
From net investment income	$ 6,882,396	$ 573,909	$ 518,540

See accompanying notes which are an integral part of the financial statements.

Balanced Portfolio

Financial Highlights - Initial Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 13.88	$ 12.16	$ 13.72	$ 14.45	$ 16.00
Income from Investment Operations
Net investment income (loss) ^C	.36 ^D	.30	.36	.42	.48
Net realized and unrealized gain (loss)	.39	1.78	(1.53)	(.63)	(1.15)
Total from investment operations	.75	2.08	(1.17)	(.21)	(.67)
Distributions from net investment income	(.28)	(.36)	(.39)	(.52)	(.48)
Distributions from net realized gain	-	-	-	-	(.35)
Distributions in excess of net realized gain	-	-	-	-	(.05)
Total distributions	(.28)	(.36)	(.39)	(.52)	(.88)
Net asset value, end of period	$ 14.35	$ 13.88	$ 12.16	$ 13.72	$ 14.45
Total Return^{A, B}	5.47%	17.72%	(8.72)%	(1.58)%	(4.30)%
Ratios to Average Net Assets ^E
Expenses before expense reductions	.56%	.59%	.57%	.57%	.58%
Expenses net of voluntary waivers, if any	.56%	.59%	.57%	.57%	.58%
Expenses net of all reductions	.56%	.58%	.55%	.55%	.56%
Net investment income (loss)	2.60%	2.32%	2.84%	3.11%	3.18%
Supplemental Data
Net assets, end of period (000 omitted)	$ 291,176	$ 295,656	$ 235,064	$ 264,608	$ 250,802
Portfolio turnover rate	74%	102%	134%	126%	126%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^D Investment income per share reflects a special dividend which amounted to $.03 per share.

Financial Highlights - Service Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 13.81	$ 12.11	$ 13.66	$ 14.39	$ 15.94
Income from Investment Operations
Net investment income (loss) ^C	.34 ^D	.28	.34	.41	.46
Net realized and unrealized gain (loss)	.40	1.77	(1.51)	(.64)	(1.14)
Total from investment operations	.74	2.05	(1.17)	(.23)	(.68)
Distributions from net investment income	(.27)	(.35)	(.38)	(.50)	(.47)
Distributions from net realized gain	-	-	-	-	(.35)
Distributions in excess of net realized gain	-	-	-	-	(.05)
Total distributions	(.27)	(.35)	(.38)	(.50)	(.87)
Net asset value, end of period	$ 14.28	$ 13.81	$ 12.11	$ 13.66	$ 14.39
Total Return^{A, B}	5.42%	17.53%	(8.75)%	(1.72)%	(4.38)%
Ratios to Average Net Assets ^E
Expenses before expense reductions	.67%	.69%	.67%	.67%	.68%
Expenses net of voluntary waivers, if any	.67%	.69%	.67%	.67%	.68%
Expenses net of all reductions	.67%	.68%	.65%	.65%	.66%
Net investment income (loss)	2.50%	2.22%	2.74%	3.01%	3.08%
Supplemental Data
Net assets, end of period (000 omitted)	$ 21,228	$ 21,903	$ 20,019	$ 25,455	$ 27,563
Portfolio turnover rate	74%	102%	134%	126%	126%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^D Investment income per share reflects a special dividend which amounted to $.03 per share.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Service Class 2

Years ended December 31,	2004	2003	2002	2001	2000 ^G
Selected Per-Share Data
Net asset value, beginning of period	$ 13.75	$ 12.05	$ 13.61	$ 14.37	$ 15.59
Income from Investment Operations
Net investment income (loss) ^E	.32 ^F	.26	.32	.38	.40
Net realized and unrealized gain (loss)	.38	1.77	(1.51)	(.63)	(.75)
Total from investment operations	.70	2.03	(1.19)	(.25)	(.35)
Distributions from net investment income	(.25)	(.33)	(.37)	(.51)	(.47)
Distributions from net realized gain	-	-	-	-	(.35)
Distributions in excess of net realized gain	-	-	-	-	(.05)
Total distributions	(.25)	(.33)	(.37)	(.51)	(.87)
Net asset value, end of period	$ 14.20	$ 13.75	$ 12.05	$ 13.61	$ 14.37
Total Return^{B, C, D}	5.15%	17.41%	(8.93)%	(1.87)%	(2.37)%
Ratios to Average Net Assets^H
Expenses before expense reductions	.82%	.84%	.83%	.83%	.85%^A
Expenses net of voluntary waivers, if any	.82%	.84%	.83%	.83%	.85%^A
Expenses net of all reductions	.82%	.84%	.81%	.81%	.83%^A
Net investment income (loss)	2.35%	2.06%	2.58%	2.85%	2.91%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 37,020	$ 29,485	$ 18,577	$ 16,798	$ 4,797
Portfolio turnover rate	74%	102%	134%	126%	126%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F Investment income per share reflects a special dividend which amounted to $.03 per share.

^G For the period January 12, 2000 (commencement of sale of shares) to December 31, 2000.

See accompanying notes which are an integral part of the financial statements.

Balanced Portfolio

Fidelity Variable Insurance Products: Growth & Income Portfolio

Performance: The Bottom Line

Average annual total return reflects the change in the value of an investment, assuming reinvestment of the class' dividend income and capital gains (the profits earned upon the sale of securities that have grown in value) and assuming a constant rate of performance each year. The $10,000 table and the fund's returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. During periods of reimbursement by Fidelity, a fund's total return will be greater than it would be had the reimbursement not occurred. Performance numbers are net of all underlying fund operating expenses, but do not include any insurance charges imposed by your insurance company's separate account. If performance information included the effect of these additional charges, the total returns would have been lower. How a fund did yesterday is no guarantee of how it will do tomorrow.

Average Annual Total Returns

Periods ended December 31, 2004	Past 1 year	Past 5 years	Life of fund ^A
Fidelity® VIP: Growth & Income - Initial Class	5.80%	-0.80%	7.24%
Fidelity VIP: Growth & Income - Service Class^B	5.75%	-0.90%	7.13%
Fidelity VIP: Growth & Income - Service Class 2 ^C	5.52%	-1.06%	7.02%

^A From December 31, 1996.

^BThe initial offering of Service Class shares took place on November 3, 1997. Performance for Service Class shares reflects an asset based distribution fee (12b-1 fee), and returns prior to November 3, 1997 are those of Initial Class and do not include the effects of Service Class' 12b-1 fee. Had Service Class shares' 12b-1 fee been reflected, returns prior to November 3, 1997 would have been lower.

^CThe initial offering of Service Class 2 shares took place on January 12, 2000. Performance for Service Class 2 shares reflects an asset based distribution fee (12b-1 fee). Returns from November 3, 1997 to January 12, 2000 are those of Service Class which reflect a different 12b-1 fee. Service Class 2 returns prior to November 3, 1997 are those of the Initial Class and do not include the effects of a 12b-1 fee. Had Service Class 2's 12b-1 fee been reflected, returns prior to January 12, 2000 would have been lower.

$10,000 Over Life of Fund

Let's say hypothetically that $10,000 was invested in Fidelity® Variable Insurance Products: Growth & Income Portfolio - Initial Class on December 31, 1996, when the fund started. The chart shows how the value of your investment would have changed, and also shows how the Standard & Poor's 500^SM Index performed over the same period.

Annual Report

Fidelity Variable Insurance Products: Growth & Income Portfolio

Management's Discussion of Fund Performance

Comments from Louis Salemy, Portfolio Manager of Fidelity® Variable Insurance Products: Growth & Income Portfolio

For the 12 months ending December 31, 2004, the fund's return was slightly more than half of the 10.88% return posted by the S&P 500®. The fund also finished well behind the Lipper^SM Variable Annuity Growth & Income Funds Average, which returned 11.14%. A significant overweighting in the media industry hurt performance versus the index. One media detractor, EchoStar Communications, was the victim of fears about competition from rival satellite TV providers and from the cable industry. Diversified financials was another weak group for the fund compared with the index. For example, top-10 holdings Morgan Stanley and Merrill Lynch both were sidetracked by investors' concerns about the impact of rising interest rates on future business. On the other hand, my decision to underweight both information technology and health care helped relative performance. In consumer staples, razor manufacturer Gillette was a significant contributor both in absolute terms and compared with the index. The introduction of a number of popular products helped the stock. Verizon Communications also aided performance, boosted by a regulatory change that enabled the company to charge higher rates for leasing its network to competitors.

Growth & Income Portfolio

Fidelity Variable Insurance Products: Growth & Income Portfolio

Investment Summary

Top Five Stocks as of December 31, 2004
	% of fund's net assets
EchoStar Communications Corp. Class A	8.1
Omnicom Group, Inc.	7.4
BellSouth Corp.	5.4
Morgan Stanley	5.2
Wells Fargo & Co.	4.9
	31.0
Top Five Market Sectors as of December 31, 2004
	% of fund's net assets
Consumer Discretionary	22.7
Financials	22.5
Consumer Staples	14.0
Telecommunication Services	12.0
Information Technology	5.9

Asset Allocation as of December 31, 2004
% of fund's net assets*
	Stocks	90.5%
	Short-Term Investments and Net Other Assets	9.5%

* Foreign
investments

2.9%

Annual Report

Fidelity Variable Insurance Products: Growth & Income Portfolio

Investments December 31, 2004

Showing Percentage of Net Assets

Common Stocks - 90.5%
	Shares		Value (Note 1)
CONSUMER DISCRETIONARY - 22.7%
Hotels, Restaurants & Leisure - 0.5%
Carnival Corp. unit	152,200		$ 8,771,286
Media - 18.9%
E.W. Scripps Co. Class A	696,300		33,617,364
EchoStar Communications Corp. Class A	3,995,800		132,820,391
News Corp. Class B (d)	1,111,400		21,338,880
Omnicom Group, Inc.	1,426,200		120,257,184
			308,033,819
Multiline Retail - 2.6%
Kohl's Corp. (a)	869,800		42,768,066
Textiles, Apparel & Luxury Goods - 0.7%
Liz Claiborne, Inc.	205,800		8,686,818
Reebok International Ltd.	57,800		2,543,200
			11,230,018
TOTAL CONSUMER DISCRETIONARY			370,803,189
CONSUMER STAPLES - 14.0%
Beverages - 0.9%
The Coca-Cola Co.	333,900		13,900,257
Food & Staples Retailing - 6.4%
Costco Wholesale Corp.	493,700		23,900,017
Wal-Mart Stores, Inc.	1,110,000		58,630,200
Walgreen Co.	584,100		22,411,917
			104,942,134
Food Products - 0.5%
McCormick & Co., Inc. (non-vtg.)	224,100		8,650,260
Household Products - 2.6%
Colgate-Palmolive Co.	224,900		11,505,884
Kimberly-Clark Corp.	465,900		30,660,879
			42,166,763
Personal Products - 2.2%
Gillette Co.	806,400		36,110,592
Tobacco - 1.4%
Altria Group, Inc.	377,960		23,093,356
TOTAL CONSUMER STAPLES			228,863,362
ENERGY - 4.6%
Oil & Gas - 4.6%
BP PLC sponsored ADR	382,200		22,320,480
Exxon Mobil Corp.	1,035,756		53,092,853
			75,413,333
FINANCIALS - 22.5%
Capital Markets - 12.2%
Goldman Sachs Group, Inc.	451,000		46,922,040
Merrill Lynch & Co., Inc.	1,126,200		67,312,974
Morgan Stanley	1,526,000		84,723,520
			198,958,534

	Shares		Value (Note 1)
Commercial Banks - 4.9%
Wells Fargo & Co.	1,287,700		$ 80,030,555
Consumer Finance - 0.9%
American Express Co.	269,700		15,202,989
Insurance - 4.5%
Allstate Corp.	335,300		17,341,716
American International Group, Inc.	547,605		35,961,220
PartnerRe Ltd.	111,600		6,912,504
St. Paul Travelers Companies, Inc.	338,239		12,538,520
			72,753,960
TOTAL FINANCIALS			366,946,038
HEALTH CARE - 1.5%
Health Care Equipment & Supplies - 0.6%
Advanced Medical Optics, Inc. (a)	1		41
Alcon, Inc.	126,600		10,203,960
			10,204,001
Pharmaceuticals - 0.9%
Pfizer, Inc.	504,900		13,576,761
TOTAL HEALTH CARE			23,780,762
INDUSTRIALS - 4.3%
Aerospace & Defense - 0.9%
Lockheed Martin Corp.	115,500		6,416,025
Northrop Grumman Corp.	169,300		9,203,148
			15,619,173
Airlines - 0.5%
Continental Airlines, Inc. Class B (a)(d)	589,900		7,987,246
Industrial Conglomerates - 2.3%
General Electric Co.	1,024,700		37,401,550
Road & Rail - 0.6%
Union Pacific Corp.	136,200		9,159,450
TOTAL INDUSTRIALS			70,167,419
INFORMATION TECHNOLOGY - 5.9%
Communications Equipment - 1.5%
Cisco Systems, Inc. (a)	1,282,200		24,746,460
Foundry Networks, Inc. (a)	300		3,948
Lucent Technologies, Inc. warrants 12/10/07 (a)	7,882		12,454
			24,762,862
Computers & Peripherals - 0.7%
Diebold, Inc.	192,200		10,711,306
IT Services - 0.5%
Paychex, Inc.	241,819		8,241,192
Software - 3.2%
Microsoft Corp.	1,972,300		52,680,133
TOTAL INFORMATION TECHNOLOGY			96,395,493
Common Stocks - continued
	Shares		Value (Note 1)
MATERIALS - 2.6%
Containers & Packaging - 2.6%
Ball Corp.	12		$ 528
Packaging Corp. of America	186,400		4,389,720
Smurfit-Stone Container Corp. (a)	2,014,600		37,632,728
			42,022,976
TELECOMMUNICATION SERVICES - 12.0%
Diversified Telecommunication Services - 12.0%
BellSouth Corp.	3,183,000		88,455,570
SBC Communications, Inc.	1,079,230		27,811,757
Verizon Communications, Inc.	1,949,500		78,974,245
			195,241,572
UTILITIES - 0.4%
Electric Utilities - 0.4%
Entergy Corp.	103,300		6,982,047
TOTAL COMMON STOCKS (Cost $1,277,038,401)		1,476,616,191
Money Market Funds - 10.7%

Fidelity Cash Central Fund, 2.24% (b)	161,471,258		161,471,258
Fidelity Securities Lending Cash Central Fund, 2.23% (b)(c)	12,948,350		12,948,350
TOTAL MONEY MARKET FUNDS (Cost $174,419,608)		174,419,608
TOTAL INVESTMENT PORTFOLIO - 101.2% (Cost $1,451,458,009)			1,651,035,799
NET OTHER ASSETS - (1.2)%			(19,680,273)
NET ASSETS - 100%			$ 1,631,355,526

Legend

(a) Non-income producing

(d) Security or a portion of the security is on loan at period end.

Income Tax Information

At December 31, 2004, the fund had a capital loss carryforward of approximately $160,503,000 of which $43,339,000, $107,381,000 and $9,783,000 will expire on December 31, 2009, 2010 and 2011, respectively.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products: Growth & Income Portfolio

Financial Statements

Statement of Assets and Liabilities

	December 31, 2004

Assets
Investment in securities, at value (including securities loaned of $12,563,366) (cost $1,451,458,009) - See accompanying schedule		$ 1,651,035,799
Receivable for fund shares sold		272,381
Dividends receivable		1,342,776
Interest receivable		290,188
Prepaid expenses		5,942
Other receivables		28,890
Total assets		1,652,975,976

Liabilities
Payable for investments purchased	$ 6,520,610
Payable for fund shares redeemed	964,642
Accrued management fee	640,386
Distribution fees payable	141,068
Other affiliated payables	134,368
Other payables and accrued expenses	271,026
Collateral on securities loaned, at value	12,948,350
Total liabilities		21,620,450

Net Assets		$ 1,631,355,526
Net Assets consist of:
Paid in capital		$ 1,572,421,991
Undistributed net investment income		22,467,135
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions		(163,111,390)
Net unrealized appreciation (depreciation) on investments		199,577,790
Net Assets		$ 1,631,355,526

Initial Class: Net Asset Value, offering price and redemption price per share ($704,460,084 ÷ 50,633,218 shares)		$ 13.91

Service Class: Net Asset Value, offering price and redemption price per share ($401,391,858 ÷ 29,031,870 shares)		$ 13.83

Service Class 2: Net Asset Value, offering price and redemption price per share ($525,503,584 ÷ 38,322,628 shares)		$ 13.71

Statement of Operations

	Year ended December 31, 2004

Investment Income
Dividends		$ 25,677,482
Special Dividends		5,800,800
Interest		2,003,713
Security lending		101,220
Total income		33,583,215

Expenses
Management fee	$ 7,335,808
Transfer agent fees	1,038,668
Distribution fees	1,462,923
Accounting and security lending fees	513,242
Non-interested trustees' compensation	8,453
Custodian fees and expenses	21,660
Audit	48,079
Legal	4,658
Miscellaneous	360,754
Total expenses before reductions	10,794,245
Expense reductions	(105,306)	10,688,939
Net investment income (loss)		22,894,276
Realized and Unrealized Gain (Loss) Net realized gain (loss) on:
Investment securities	6,143,736
Foreign currency transactions	(11,098)
Total net realized gain (loss)		6,132,638
Change in net unrealized appreciation (depreciation) on investment securities		59,376,943
Net gain (loss)		65,509,581
Net increase (decrease) in net assets resulting from operations		$ 88,403,857

See accompanying notes which are an integral part of the financial statements.

Growth & Income Portfolio

Statement of Changes in Net Assets

	Year ended December 31, 2004	Year ended December 31, 2003
Increase (Decrease) in Net Assets
Operations
Net investment income (loss)	$ 22,894,276	$ 11,563,948
Net realized gain (loss)	6,132,638	(8,957,165)
Change in net unrealized appreciation (depreciation)	59,376,943	256,023,394
Net increase (decrease) in net assets resulting from operations	88,403,857	258,630,177
Distributions to shareholders from net investment income	(12,447,351)	(12,772,749)
Share transactions - net increase (decrease)	70,330,734	210,037,372
Total increase (decrease) in net assets	146,287,240	455,894,800

Net Assets
Beginning of period	1,485,068,286	1,029,173,486
End of period (including undistributed net investment income of $22,467,135 and undistributed net investment income of $12,027,562, respectively)	$ 1,631,355,526	$ 1,485,068,286

Other Information:
	Year ended December 31, 2004
Share Transactions	Initial Class	Service Class	Service Class 2
Shares Sold	2,753,905	2,759,500	13,125,821
Reinvested	498,736	216,142	212,315
Redeemed	(11,869,073)	(1,077,681)	(1,149,269)
Net increase (decrease)	(8,616,432)	1,897,961	12,188,867

Dollars Sold	$ 36,538,808	$ 36,240,477	$ 171,074,614
Reinvested	6,722,963	2,898,471	2,825,917
Redeemed	(156,807,050)	(14,210,796)	(14,952,670)
Net increase (decrease)	$ (113,545,279)	$ 24,928,152	$ 158,947,861

	Year ended December 31, 2003
Share Transactions	Initial Class	Service Class	Service Class 2
Shares Sold	8,588,135	4,730,597	14,305,974
Reinvested	791,445	298,276	164,516
Redeemed	(8,881,933)	(1,062,769)	(1,468,648)
Net increase (decrease)	497,647	3,966,104	13,001,842

Dollars Sold	$ 102,662,499	$ 56,731,473	$ 170,921,383
Reinvested	8,080,656	3,030,479	1,661,614
Redeemed	(103,784,385)	(12,033,144)	(17,233,203)
Net increase (decrease)	$ 6,958,770	$ 47,728,808	$ 155,349,794

Distributions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2
From net investment income	$ 6,722,963	$ 2,898,471	$ 2,825,917

	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2
From net investment income	$ 8,080,656	$ 3,030,479	$ 1,661,614

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Initial Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 13.26	$ 10.86	$ 13.19	$ 15.26	$ 17.30
Income from Investment Operations
Net investment income (loss)^C	.21^D	.12	.15	.18	.20
Net realized and unrealized gain (loss)	.56	2.42	(2.32)	(1.45)	(.81)
Total from investment operations	.77	2.54	(2.17)	(1.27)	(.61)
Distributions from net investment income	(.12)	(.14)	(.16)	(.19)	(.19)
Distributions from net realized gain	-	-	-	(.61)	(1.24)
Total distributions	(.12)	(.14)	(.16)	(.80)	(1.43)
Net asset value, end of period	$ 13.91	$ 13.26	$ 10.86	$ 13.19	$ 15.26
Total Return^A,B	5.80%	23.77%	(16.61)%	(8.75)%	(3.62)%
Ratios to Average Net Assets^E
Expenses before expense reductions	.60%	.59%	.59%	.58%	.58%
Expenses net of voluntary waivers, if any	.60%	.59%	.59%	.58%	.58%
Expenses net of all reductions	.60%	.59%	.58%	.56%	.57%
Net investment income (loss)	1.58%	1.02%	1.30%	1.34%	1.26%
Supplemental Data
Net assets, end of period (000 omitted)	$ 704,460	$ 785,494	$ 638,124	$ 893,359	$ 1,011,393
Portfolio turnover rate	23%	25%	43%	58%	72%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^D Investment income per share reflects a special dividend which amounted to $.05 per share.

Financial Highlights - Service Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 13.18	$ 10.80	$ 13.12	$ 15.19	$ 17.24
Income from Investment Operations
Net investment income (loss)^C	.19^D	.11	.14	.16	.18
Net realized and unrealized gain (loss)	.57	2.40	(2.31)	(1.44)	(.80)
Total from investment operations	.76	2.51	(2.17)	(1.28)	(.62)
Distributions from net investment income	(.11)	(.13)	(.15)	(.18)	(.19)
Distributions from net realized gain	-	-	-	(.61)	(1.24)
Total distributions	(.11)	(.13)	(.15)	(.79)	(1.43)
Net asset value, end of period	$ 13.83	$ 13.18	$ 10.80	$ 13.12	$ 15.19
Total Return^A,B	5.75%	23.60%	(16.69)%	(8.85)%	(3.69)%
Ratios to Average Net Assets^E
Expenses before expense reductions	.70%	.69%	.69%	.68%	.69%
Expenses net of voluntary waivers, if any	.70%	.69%	.69%	.68%	.69%
Expenses net of all reductions	.70%	.69%	.68%	.66%	.68%
Net investment income (loss)	1.48%	.92%	1.20%	1.24%	1.16%
Supplemental Data
Net assets, end of period (000 omitted)	$ 401,392	$ 357,585	$ 250,160	$ 281,194	$ 212,994
Portfolio turnover rate	23%	25%	43%	58%	72%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^D Investment income per share reflects a special dividend which amounted to $.05 per share.

See accompanying notes which are an integral part of the financial statements.

Growth & Income Portfolio

Financial Highlights - Service Class 2

Years ended December 31,	2004	2003	2002	2001	2000^G
Selected Per-Share Data
Net asset value, beginning of period	$ 13.09	$ 10.73	$ 13.07	$ 15.17	$ 16.94
Income from Investment Operations
Net investment income (loss)^E	.17^F	.09	.12	.14	.15
Net realized and unrealized gain (loss)	.55	2.39	(2.30)	(1.44)	(.49)
Total from investment operations	.72	2.48	(2.18)	(1.30)	(.34)
Distributions from net investment income	(.10)	(.12)	(.16)	(.19)	(.19)
Distributions from net realized gain	-	-	-	(.61)	(1.24)
Total distributions	(.10)	(.12)	(.16)	(.80)	(1.43)
Net asset value, end of period	$ 13.71	$ 13.09	$ 10.73	$ 13.07	$ 15.17
Total Return^B,C,D	5.52%	23.44%	(16.84)%	(9.01)%	(2.11)%
Ratios to Average Net Assets^H
Expenses before expense reductions	.85%	.85%	.85%	.84%	.85%^A
Expenses net of voluntary waivers, if any	.85%	.85%	.85%	.84%	.85%^A
Expenses net of all reductions	.85%	.84%	.84%	.82%	.84%^A
Net investment income (loss)	1.33%	.76%	1.05%	1.08%	1.00%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 525,504	$ 341,989	$ 140,890	$ 76,237	$ 13,025
Portfolio turnover rate	23%	25%	43%	58%	72%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F Investment income per share reflects a special dividend which amounted to $.05 per share.

^G For the period January 12, 2000 (commencement of operations) to December 31, 2000.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products: Growth Opportunities Portfolio

Performance: The Bottom Line

Average Annual Total Returns

Periods ended December 31, 2004	Past 1 year	Past 5 years	Life of fund ^A
Fidelity ® VIP: Growth Opportunities - Initial Class	7.19%	-5.04%	7.41%
Fidelity VIP: Growth Opportunities - Service Class ^B	7.06%	-5.14%	7.33%
Fidelity VIP: Growth Opportunities - Service Class 2 ^C	6.89%	-5.30%	7.25%

^A From January 3, 1995

^B The initial offering of Service Class shares took place November 3, 1997. Performance for Service Class shares reflects an asset based service fee (12b-1 fee), and returns prior to November 3, 1997 are those of Initial Class and do not include the effects of Service Class 12b-1 fee. Had Service Class shares' 12b-1 fee been reflected, returns prior to November 3, 1997 would have been lower.

^C The initial offering of Service Class 2 shares took place January 12, 2000. Performance for Service Class 2 shares reflects an asset based service fee (12b-1 fee). Returns from November 3, 1997 to January 12, 2000 are those of Service Class which reflect a different 12b-1 fee. Service Class 2 returns prior to November 3, 1997 are those of Initial Class and do not include the effects of a 12b-1 fee. Had Service Class 2 shares' 12b-1 fee been reflected, returns prior to January 12, 2000 would have been lower.

$10,000 Over Life of Fund

Let's say hypothetically that $10,000 was invested in Fidelity® Variable Insurance Products: Growth Opportunities Portfolio - Initial Class on January 3, 1995, when the fund started. The chart shows how the value of your investment would have changed, and also shows how the S&P 500® Index performed over the same period.

Growth Opportunities Portfolio

Fidelity Variable Insurance Products: Growth Opportunities

Management's Discussion of Fund Performance

Comments from Bettina Doulton, Portfolio Manager of Fidelity® Variable Insurance Products: Growth Opportunities Portfolio

For the year ending December 31, 2004, the fund underperformed both the S&P 500® and the Lipper^SM Variable Annuity Growth Funds Average, which returned 10.36%. Compared to the S&P 500, the fund's overweighting in weak-performing media and semiconductor stocks hurt performance. Traditional media plays such as Viacom and Spanish-language broadcasting company Univision were detractors, along with tech names National Semiconductor and Analog Devices. Underweighting strong-performing energy stocks also proved to be a disappointment. Energy companies Schlumberger, BP and Baker Hughes were among the fund's top relative and absolute performers, but underweighting such names as Exxon Mobil, ChevronTexaco and ConocoPhillips largely offset those gains. Another negative was the fund's large-cap bias in a period that favored smaller-cap stocks. On the positive side, good stock selection in consumer staples and health care boosted returns, led by personal product makers such as Gillette, eye-care company Alcon and health care services provider UnitedHealth Group.

Annual Report

Fidelity Variable Insurance Products: Growth Opportunities Portfolio

Investment Summary

Top Five Stocks as of December 31, 2004
	% of fund's net assets
General Electric Co.	3.8
Bank of America Corp.	2.9
Microsoft Corp.	2.5
Exxon Mobil Corp.	2.3
American Express Co.	2.2
	13.7
Top Five Market Sectors as of December 31, 2004
	% of fund's net assets
Information Technology	21.4
Consumer Discretionary	17.3
Financials	16.2
Industrials	12.4
Health Care	9.9

Asset Allocation as of December 31, 2004
% of fund's net assets*
	Stocks	95.0%
	Short-Term Investments and Net Other Assets	5.0%
* Foreign investments		4.7%

Growth Opportunities Portfolio

Fidelity Variable Insurance Products: Growth Opportunities Portfolio

Investments December 31, 2004

Showing Percentage of Net Assets

Common Stocks - 94.7%
	Shares		Value (Note 1)
CONSUMER DISCRETIONARY - 17.3%
Automobiles - 0.2%
Harley-Davidson, Inc.	30,400		$ 1,846,800
Hotels, Restaurants & Leisure - 1.8%
Carnival Corp. unit	39,000		2,247,570
Hilton Hotels Corp.	210,170		4,779,266
Royal Caribbean Cruises Ltd.	23,500		1,279,340
Starwood Hotels & Resorts Worldwide, Inc. unit	85,200		4,975,680
			13,281,856
Internet & Catalog Retail - 0.7%
eBay, Inc. (a)	43,400		5,046,552
Leisure Equipment & Products - 0.3%
Brunswick Corp.	40,900		2,024,550
Media - 9.8%
Clear Channel Communications, Inc.	42,600		1,426,674
DreamWorks Animation SKG, Inc. Class A	26,000		975,260
Fox Entertainment Group, Inc. Class A (a)	245,300		7,668,078
Grupo Televisa SA de CV sponsored ADR	38,000		2,299,000
Lamar Advertising Co. Class A (a)	45,600		1,950,768
Martha Stewart Living Omnimedia, Inc. Class A (a)(d)	88,500		2,568,270
McGraw-Hill Companies, Inc.	68,000		6,224,720
Meredith Corp.	41,800		2,265,560
News Corp. Class B (d)	547,700		10,515,840
Omnicom Group, Inc.	105,400		8,887,328
Time Warner, Inc. (a)	212,300		4,127,112
Univision Communications, Inc. Class A (a)	230,700		6,752,589
Viacom, Inc. Class B (non-vtg.)	204,420		7,438,844
Walt Disney Co.	256,700		7,136,260
XM Satellite Radio Holdings, Inc. Class A (a)	49,400		1,858,428
			72,094,731
Multiline Retail - 1.1%
Kmart Holding Corp. (a)(d)	12,700		1,256,665
Kohl's Corp. (a)	49,400		2,428,998
Nordstrom, Inc.	95,000		4,439,350
			8,125,013
Specialty Retail - 2.3%
Best Buy Co., Inc.	32,500		1,931,150
Home Depot, Inc.	210,600		9,001,044
Lowe's Companies, Inc.	6,800		391,612
Staples, Inc.	157,097		5,295,740
			16,619,546
Textiles, Apparel & Luxury Goods - 1.1%
Coach, Inc. (a)	24,800		1,398,720
NIKE, Inc. Class B	23,900		2,167,491

	Shares		Value (Note 1)
Polo Ralph Lauren Corp. Class A	91,100		$ 3,880,860
Warnaco Group, Inc. (a)	44,200		954,720
			8,401,791
TOTAL CONSUMER DISCRETIONARY			127,440,839
CONSUMER STAPLES - 7.0%
Beverages - 0.6%
PepsiCo, Inc.	80,600		4,207,320
Food & Staples Retailing - 2.0%
CVS Corp.	71,600		3,227,012
Wal-Mart Stores, Inc.	217,700		11,498,914
			14,725,926
Food Products - 1.4%
Archer-Daniels-Midland Co.	144,000		3,212,640
Bunge Ltd.	77,200		4,401,172
Hershey Foods Corp.	45,000		2,499,300
			10,113,112
Household Products - 0.2%
Procter & Gamble Co.	21,640		1,191,931
Personal Products - 1.9%
Gillette Co.	319,370		14,301,389
Tobacco - 0.9%
Altria Group, Inc.	110,420		6,746,662
TOTAL CONSUMER STAPLES			51,286,340
ENERGY - 6.3%
Energy Equipment & Services - 3.1%
Baker Hughes, Inc.	65,700		2,803,419
Halliburton Co.	149,000		5,846,760
Schlumberger Ltd. (NY Shares)	210,600		14,099,670
			22,749,849
Oil & Gas - 3.2%
BP PLC sponsored ADR	109,490		6,394,216
Exxon Mobil Corp.	329,700		16,900,422
			23,294,638
TOTAL ENERGY			46,044,487
FINANCIALS - 15.9%
Capital Markets - 5.7%
Charles Schwab Corp.	62,000		741,520
E*TRADE Financial Corp. (a)	322,500		4,821,375
Goldman Sachs Group, Inc.	111,600		11,610,864
Lehman Brothers Holdings, Inc.	48,200		4,216,536
Merrill Lynch & Co., Inc.	224,400		13,412,388
Morgan Stanley	123,900		6,878,928
			41,681,611
Common Stocks - continued
	Shares		Value (Note 1)
FINANCIALS - continued
Commercial Banks - 3.8%
Bank of America Corp.	457,600		$ 21,502,624
Wells Fargo & Co.	105,500		6,556,825
			28,059,449
Consumer Finance - 2.7%
American Express Co.	283,600		15,986,532
SLM Corp.	67,900		3,625,181
			19,611,713
Diversified Financial Services - 1.6%
Citigroup, Inc.	247,207		11,910,433
Insurance - 2.1%
American International Group, Inc.	237,262		15,580,996
TOTAL FINANCIALS			116,844,202
HEALTH CARE - 9.9%
Biotechnology - 1.1%
Genentech, Inc. (a)	74,900		4,077,556
Genzyme Corp. - General Division (a)	36,000		2,090,520
OSI Pharmaceuticals, Inc. (a)	22,000		1,646,700
			7,814,776
Health Care Equipment & Supplies - 2.9%
Alcon, Inc.	41,100		3,312,660
Becton, Dickinson & Co.	74,700		4,242,960
Boston Scientific Corp. (a)	35,700		1,269,135
C.R. Bard, Inc.	47,600		3,045,448
Dade Behring Holdings, Inc. (a)	47,500		2,660,000
Medtronic, Inc.	71,300		3,541,471
St. Jude Medical, Inc. (a)	85,660		3,591,724
			21,663,398
Health Care Providers & Services - 1.6%
UnitedHealth Group, Inc.	130,300		11,470,309
Pharmaceuticals - 4.3%
Abbott Laboratories	44,430		2,072,660
Johnson & Johnson	151,200		9,589,104
Pfizer, Inc.	368,193		9,900,710
Schering-Plough Corp.	76,000		1,586,880
Wyeth	198,500		8,454,115
			31,603,469
TOTAL HEALTH CARE			72,551,952
INDUSTRIALS - 12.4%
Aerospace & Defense - 2.3%
Honeywell International, Inc.	212,900		7,538,789
Lockheed Martin Corp.	19,100		1,061,005
Northrop Grumman Corp.	39,000		2,120,040
The Boeing Co.	114,100		5,906,957
			16,626,791

	Shares		Value (Note 1)
Air Freight & Logistics - 2.6%
FedEx Corp.	121,800		$ 11,996,082
United Parcel Service, Inc. Class B	83,500		7,135,910
			19,131,992
Airlines - 0.4%
Southwest Airlines Co.	170,150		2,770,042
Commercial Services & Supplies - 0.2%
Monster Worldwide, Inc. (a)	41,200		1,385,968
Construction & Engineering - 0.4%
Fluor Corp.	59,500		3,243,345
Industrial Conglomerates - 5.7%
3M Co.	59,700		4,899,579
General Electric Co.	769,450		28,084,923
Tyco International Ltd.	242,900		8,681,246
			41,665,748
Machinery - 0.8%
Caterpillar, Inc.	26,000		2,535,260
Deere & Co.	47,600		3,541,440
			6,076,700
TOTAL INDUSTRIALS			90,900,586
INFORMATION TECHNOLOGY - 21.4%
Communications Equipment - 6.2%
Avaya, Inc. (a)	83,400		1,434,480
Cisco Systems, Inc. (a)	514,060		9,921,358
Extreme Networks, Inc. (a)	6,900		45,195
Juniper Networks, Inc. (a)	510,000		13,866,900
Motorola, Inc.	405,800		6,979,760
QUALCOMM, Inc.	308,800		13,093,120
			45,340,813
Computers & Peripherals - 4.2%
Dell, Inc. (a)	207,200		8,731,408
Diebold, Inc.	89,100		4,965,543
EMC Corp. (a)	190,700		2,835,709
Network Appliance, Inc. (a)	421,800		14,012,196
			30,544,856
Electronic Equipment & Instruments - 0.3%
CDW Corp.	27,300		1,811,355
Internet Software & Services - 1.0%
Yahoo!, Inc. (a)	201,500		7,592,520
IT Services - 0.3%
Affiliated Computer Services, Inc. Class A (a)	31,700		1,908,023
Office Electronics - 0.4%
Xerox Corp. (a)	192,200		3,269,322
Semiconductors & Semiconductor Equipment - 4.5%
Advanced Micro Devices, Inc. (a)	69,700		1,534,794
Altera Corp. (a)	63,400		1,312,380
Analog Devices, Inc.	112,100		4,138,732
Freescale Semiconductor, Inc. Class B	96,286		1,767,811
Common Stocks - continued
	Shares		Value (Note 1)
INFORMATION TECHNOLOGY - continued
Semiconductors & Semiconductor Equipment - continued
Intel Corp.	400,110		$ 9,358,573
KLA-Tencor Corp. (a)	16,300		759,254
Marvell Technology Group Ltd. (a)	32,100		1,138,587
National Semiconductor Corp.	321,600		5,772,720
Texas Instruments, Inc.	303,500		7,472,170
Xilinx, Inc.	3,300		97,845
			33,352,866
Software - 4.5%
Microsoft Corp.	684,120		18,272,845
Oracle Corp. (a)	201,700		2,767,324
Red Hat, Inc. (a)	197,699		2,639,282
Symantec Corp. (a)	211,466		5,447,364
VERITAS Software Corp. (a)	136,600		3,899,930
			33,026,745
TOTAL INFORMATION TECHNOLOGY			156,846,500
MATERIALS - 2.6%
Chemicals - 2.6%
Dow Chemical Co.	142,100		7,035,371
Monsanto Co.	103,500		5,749,425
Praxair, Inc.	143,300		6,326,695
			19,111,491
TELECOMMUNICATION SERVICES - 1.9%
Diversified Telecommunication Services - 1.8%
SBC Communications, Inc.	231,060		5,954,416
Verizon Communications, Inc.	173,800		7,040,638
			12,995,054
Wireless Telecommunication Services - 0.1%
SpectraSite, Inc. (a)	18,200		1,053,780
TOTAL TELECOMMUNICATION SERVICES			14,048,834
TOTAL COMMON STOCKS (Cost $538,285,820)		695,075,231
Convertible Preferred Stocks - 0.3%

FINANCIALS - 0.3%
Thrifts & Mortgage Finance - 0.3%
Fannie Mae 5.375%	20		2,107,500
TOTAL CONVERTIBLE PREFERRED STOCKS (Cost $2,000,000)		2,107,500
Money Market Funds - 5.2%
	Shares		Value (Note 1)
Fidelity Cash Central Fund, 2.24% (b)	30,774,121		$ 30,774,121
Fidelity Securities Lending Cash Central Fund, 2.23% (b)(c)	7,454,150		7,454,150
TOTAL MONEY MARKET FUNDS (Cost $38,228,271)		38,228,271
TOTAL INVESTMENT PORTFOLIO - 100.2% (Cost $578,514,091)			735,411,002
NET OTHER ASSETS - (0.2)%			(1,607,777)
NET ASSETS - 100%		$ 733,803,225

Legend

(a) Non-income producing

(d) Security or a portion of the security is on loan at period end.

Income Tax Information

At December 31, 2004, the fund had a capital loss carryforward of approximately $265,682,000 of which $189,000, $149,878,000 and $115,615,000 will expire on December 31, 2008, 2009 and 2010, respectively.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products: Growth Opportunities Portfolio

Financial Statements

Statement of Assets and Liabilities

	December 31, 2004
Assets
Investment in securities, at value (including securities loaned of $7,237,330) (cost $578,514,091) - See accompanying schedule		$ 735,411,002
Cash		3,055
Receivable for investments sold		11,249,546
Receivable for fund shares sold		135,855
Dividends receivable		703,580
Interest receivable		65,698
Prepaid expenses		2,788
Other receivables		106,538
Total assets		747,678,062

Liabilities
Payable for investments purchased	$ 5,156,285
Payable for fund shares redeemed	636,421
Accrued management fee	347,845
Distribution fees payable	30,301
Other affiliated payables	63,647
Other payables and accrued expenses	186,188
Collateral on securities loaned, at value	7,454,150
Total liabilities		13,874,837

Net Assets		$ 733,803,225
Net Assets consist of:
Paid in capital		$ 838,195,433
Undistributed net investment income		6,108,550
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions		(267,397,669)
Net unrealized appreciation (depreciation) on investments		156,896,911
Net Assets		$ 733,803,225

Initial Class: Net Asset Value, offering price and redemption price per share ($459,975,294 ÷ 28,629,430 shares)		$ 16.07

Service Class: Net Asset Value, offering price and redemption price per share ($212,890,231 ÷ 13,261,966 shares)		$ 16.05

Service Class 2: Net Asset Value, offering price and redemption price per share ($60,937,700 ÷ 3,817,776 shares)		$ 15.96

Statement of Operations

	Year ended December 31, 2004
Investment Income
Dividends		$ 9,314,024
Special Dividends		2,052,360
Interest		376,235
Security lending		80,267
Total income		11,822,886

Expenses
Management fee	$ 4,230,844
Transfer agent fees	507,306
Distribution fees	361,674
Accounting and security lending fees	275,838
Non-interested trustees' compensation	4,060
Custodian fees and expenses	23,270
Audit	42,178
Legal	2,383
Miscellaneous	199,827
Total expenses before reductions	5,647,380
Expense reductions	(139,491)	5,507,889
Net investment income (loss)		6,314,997
Realized and Unrealized Gain (Loss) Net realized gain (loss) on:
Investment securities	13,616,926
Foreign currency transactions	7,633
Futures contracts	1,324,924
Total net realized gain (loss)		14,949,483
Change in net unrealized appreciation (depreciation) on: Investment securities	27,611,661
Assets and liabilities in foreign currencies	(9,841)
Futures contracts	(853,313)
Total change in net unrealized appreciation (depreciation)		26,748,507
Net gain (loss)		41,697,990
Net increase (decrease) in net assets resulting from operations		$ 48,012,987

See accompanying notes which are an integral part of the financial statements.

Growth Opportunities Portfolio

Statement of Changes in Net Assets

	Year ended December 31, 2004	Year ended December 31, 2003
Increase (Decrease) in Net Assets
Operations
Net investment income (loss)	$ 6,314,997	$ 3,979,285
Net realized gain (loss)	14,949,483	18,204,829
Change in net unrealized appreciation (depreciation)	26,748,507	154,484,695
Net increase (decrease) in net assets resulting from operations	48,012,987	176,668,809
Distributions to shareholders from net investment income	(3,865,122)	(4,842,328)
Share transactions - net increase (decrease)	(85,843,295)	(29,607,058)
Total increase (decrease) in net assets	(41,695,430)	142,219,423

Net Assets
Beginning of period	775,498,655	633,279,232
End of period (including undistributed net investment income of $6,108,550 and undistributed net investment income of $3,663,993, respectively)	$ 733,803,225	$ 775,498,655

Other Information:
Share Transactions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2
Shares Sold	2,729,868	870,070	885,612
Reinvested	170,805	67,879	13,011
Redeemed	(6,832,162)	(2,590,797)	(1,093,977)
Net increase (decrease)	(3,931,489)	(1,652,848)	(195,354)

Dollars Sold	$ 41,720,058	$ 13,156,606	$ 13,251,573
Reinvested	2,623,558	1,042,625	198,939
Redeemed	(102,539,187)	(38,992,902)	(16,304,565)
Net increase (decrease)	$ (58,195,571)	$ (24,793,671)	$ (2,854,053)

Share Transactions	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2
Shares Sold	4,861,113	1,609,284	1,388,002
Reinvested	309,123	114,933	19,452
Redeemed	(7,052,265)	(2,906,117)	(959,886)
Net increase (decrease)	(1,882,029)	(1,181,900)	447,568

Dollars Sold	$ 63,883,410	$ 21,117,379	$ 18,018,110
Reinvested	3,375,625	1,255,069	211,634
Redeemed	(88,846,190)	(36,517,831)	(12,104,264)
Net increase (decrease)	$ (21,587,155)	$ (14,145,383)	$ 6,125,480

Distributions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2
From net investment income	$ 2,623,558	$ 1,042,625	$ 198,939
From net realized gain	-	-	-
Total	$ 2,623,558	$ 1,042,625	$ 198,939
	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2
From net investment income	$ 3,375,625	$ 1,255,069	$ 211,634
From net realized gain	-	-	-
Total	$ 3,375,625	$ 1,255,069	$ 211,634

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Initial Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 15.07	$ 11.71	$ 15.13	$ 17.74	$ 23.15
Income from Investment Operations
Net investment income (loss)^C	.14^D	.08	.09	.12	.06
Net realized and unrealized gain (loss)	.94	3.38	(3.37)	(2.67)	(3.77)
Total from investment operations	1.08	3.46	(3.28)	(2.55)	(3.71)
Distributions from net investment income	(.08)	(.10)	(.14)	(.06)	(.29)
Distributions from net realized gain	-	-	-	-	(1.41)
Total distributions	(.08)	(.10)	(.14)	(.06)	(1.70)
Net asset value, end of period	$ 16.07	$ 15.07	$ 11.71	$ 15.13	$ 17.74
Total Return^{A, B}	7.19%	29.87%	(21.84)%	(14.42)%	(17.07)%
Ratios to Average Net Assets^E
Expenses before expense reductions	.72%	.72%	.70%	.69%	.68%
Expenses net of voluntary waivers, if any	.72%	.72%	.70%	.69%	.68%
Expenses net of all reductions	.70%	.70%	.66%	.67%	.66%
Net investment income (loss)	.91%	.64%	.68%	.79%	.31%
Supplemental Data
Net assets, end of period (000 omitted)	$ 459,975	$ 490,710	$ 403,476	$ 652,493	$ 951,875
Portfolio turnover rate	65%	62%	60%	89%	117%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^D Investment income per share reflects a special dividend which amounted to $.04 per share.

Financial Highlights - Service Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 15.06	$ 11.70	$ 15.11	$ 17.71	$ 23.12
Income from Investment Operations
Net investment income (loss)^C	.12^D	.07	.08	.11	.04
Net realized and unrealized gain (loss)	.94	3.37	(3.37)	(2.67)	(3.76)
Total from investment operations	1.06	3.44	(3.29)	(2.56)	(3.72)
Distributions from net investment income	(.07)	(.08)	(.12)	(.04)	(.28)
Distributions from net realized gain	-	-	-	-	(1.41)
Total distributions	(.07)	(.08)	(.12)	(.04)	(1.69)
Net asset value, end of period	$ 16.05	$ 15.06	$ 11.70	$ 15.11	$ 17.71
Total Return^{A, B}	7.06%	29.66%	(21.92)%	(14.49)%	(17.13)%
Ratios to Average Net Assets^E
Expenses before expense reductions	.82%	.82%	.80%	.79%	.79%
Expenses net of voluntary waivers, if any	.82%	.82%	.80%	.79%	.79%
Expenses net of all reductions	.80%	.80%	.77%	.77%	.76%
Net investment income (loss)	.81%	.54%	.58%	.69%	.21%
Supplemental Data
Net assets, end of period (000 omitted)	$ 212,890	$ 224,660	$ 188,318	$ 278,446	$ 345,960
Portfolio turnover rate	65%	62%	60%	89%	117%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^D Investment income per share reflects a special dividend which amounted to $.04 per share.

See accompanying notes which are an integral part of the financial statements.

Growth Opportunities Portfolio

Financial Highlights - Service Class 2

Years ended December 31,	2004	2003	2002	2001	2000^G
Selected Per-Share Data
Net asset value, beginning of period	$ 14.98	$ 11.64	$ 15.04	$ 17.68	$ 22.70
Income from Investment Operations
Net investment income (loss)^E	.10^F	.05	.05	.08	.01
Net realized and unrealized gain (loss)	.93	3.35	(3.34)	(2.66)	(3.34)
Total from investment operations	1.03	3.40	(3.29)	(2.58)	(3.33)
Distributions from net investment income	(.05)	(.06)	(.11)	(.06)	(.28)
Distributions from net realized gain	-	-	-	-	(1.41)
Total distributions	(.05)	(.06)	(.11)	(.06)	(1.69)
Net asset value, end of period	$ 15.96	$ 14.98	$ 11.64	$ 15.04	$ 17.68
Total Return^{B, C, D}	6.89%	29.40%	(22.01)%	(14.64)%	(15.74)%
Ratios to Average Net Assets^H
Expenses before expense reductions	.98%	.99%	.97%	.95%	.95%^A
Expenses net of voluntary waivers, if any	.98%	.99%	.97%	.95%	.95%^A
Expenses net of all reductions	.96%	.96%	.94%	.93%	.93%^A
Net investment income (loss)	.65%	.37%	.41%	.53%	.04%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 60,938	$ 60,129	$ 41,486	$ 44,643	$ 25,827
Portfolio turnover rate	65%	62%	60%	89%	117%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F Investment income per share reflects a special dividend which amounted to $.04 per share.

^G For the period January 12, 2000 (commencement of sale of shares) to December 31, 2000.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products: Investment Grade Bond Portfolio

Performance: The Bottom Line

Average Annual Total Returns

Periods ended December 31, 2004	Past 1 year	Past 5 years	Past 10 years
Fidelity VIP: Investment Grade Bond - Initial Class	4.46%	7.90%	7.60%
Fidelity VIP: Investment Grade Bond - Service Class^A	4.32%	7.77%	7.53%
Fidelity VIP: Investment Grade Bond - Service Class 2^B	4.19%	7.58%	7.44%

^A The initial offering of Service Class shares took place on July 7, 2000. Performance for Service Class shares reflects an asset-based service fee (12b-1 fee), and returns prior to July 7, 2000 are those of Initial Class and do not include the effects of Service Class' 12b-1 fee. Had Service Class' 12b-1 fee been reflected, returns prior to July 7, 2000 would have been lower.

^B The initial offering of Service Class 2 shares took place on January 12, 2000. Performance for Service Class 2 shares reflects an asset-based service fee (12b-1 fee), and returns prior to January 12, 2000 are those of Initial Class and do not include the effects of Service Class 2's 12b-1 fee. Had Service Class 2's 12b-1 fee been reflected, returns prior to January 12, 2000 would have been lower.

$10,000 Over 10 Years

Let's say hypothetically that $10,000 was invested in Fidelity ® Variable Insurance Products: Investment Grade Bond Portfolio - Initial Class on December 31, 1994. The chart shows how the value of your investment would have changed, and also shows how the Lehman Brothers® Aggregate Bond Index performed over the same period.

Investment Grade Bond Portfolio

Fidelity Variable Insurance Products: Investment Grade Bond Portfolio

Management's Discussion of Fund Performance

Comments from Ford O'Neil, Portfolio Manager of Fidelity® Variable Insurance Products: Investment Grade Bond Portfolio

Despite five increases in short-term interest rates by the Federal Reserve Board, the U.S. investment-grade bond market had a positive return for the year ending December 31, 2004. In that time, the Lehman Brothers® Aggregate Bond Index rose 4.34%. While that's roughly half of the benchmark's average annual return of 8.97%, it's better than many market analysts expected heading into 2004 given concerns about the potentially high levels of economic growth and subsequent inflation. However, the economic expansion was more moderate than anticipated, and the Fed reassured investors that rate tightening would be undertaken at a "measured pace." Among the spread sectors, corporate bonds and mortgages fared best fared best, as the Lehman Brothers Credit Bond and Mortgage-Backed Securities indexes rose 5.24% and 4.70%, respectively. Agencies hurt by the questionable accounting practices of a large government-sponsored enterprise, which held the Lehman Brothers U.S. Agency Index to a 3.33% return. Treasuries - the most interest-rate-sensitive bond category - advanced 3.54% according to the Lehman Brothers U.S. Treasury Index.

For the 12 months ending December 31, 2004, the portfolio's return was roughly in line with the Lehman Brothers Aggregate Bond Index and the 4.22% return of the Lipper^SMVariable Annuity Intermediate Investment Grade Debt Funds Average. Relative to the peer group average, I believe the portfolio was helped by my approach to managing the fund's interest rate sensitivity, which involved keeping it in line with its index. Adhering to that approach was beneficial in a volatile environment that proved treacherous to those investors trying to time interest rates. My decision to overweight spread products - such as corporate and mortgage securities - and heavily underweight Treasuries relative to the index also worked in our favor given that riskier assets outperformed during the year. In particular, our focus on BBB-rated corporate issues helped the fund's return, as they performed well in response to improving credit conditions and solid demand for high-yielding bonds. Selective investments in foreign corporate bonds denominated in U.S. dollars also generally aided performance. Detracting modestly from the portfolio's returns were a few small positions in the transportation industry. I subsequently trimmed some corporate holdings when I felt their prices reflected fair market value.

Annual Report

Fidelity Variable Insurance Products: Investment Grade Bond Portfolio

Investment Summary

Quality Diversification (% of fund's net assets) as of December 31, 2004
	U.S.Government and U.S.Government Agency Obligations	53.7%
	AAA	6.9%
	AA	4.7%
	A	9.0%
	BBB	13.8%
	BB and Below	0.9%
	Not Rated	0.1%
	Short-Term Investments and Net Other Assets	10.9%

We have used ratings from Moody's® Investors Services, Inc. Where Moody's ratings are not available, we have used S&P® ratings.

Average Years to Maturity as of December 31, 2004
Years	4.9

Average years to maturity is based on the average time remaining until principal payments are expected from each of the fund's bonds, weighted by dollar amount.

Top Five Market Sectors as of December 31, 2004
	% of fund's net assets
Financials	8.1
Telecommunication Services	3.6
Utilities	2.8
Energy	2.1
Consumer Discretionary	2.0

The information in the above tables is based on the combined investments of the fund and its pro-rata share of the investments of Fidelity's fixed-income central fund.

Investment Grade Bond Portfolio

Fidelity Variable Insurance Products: Investment Grade Bond Portfolio

Investments December 31, 2004

Showing Percentage of Net Assets

Nonconvertible Bonds - 19.2%
	Principal Amount		Value (Note 1)
CONSUMER DISCRETIONARY - 1.8%
Auto Components - 0.3%
DaimlerChrysler NA Holding Corp. 7.2% 9/1/09	$ 4,645,000		$ 5,169,959
Automobiles - 0.7%
Ford Motor Co.:
6.625% 10/1/28	690,000		643,596
7.45% 7/16/31	3,310,000		3,328,993
General Motors Corp.:
8.25% 7/15/23	3,580,000		3,729,186
8.375% 7/15/33	3,080,000		3,191,136
			10,892,911
Media - 0.8%
AOL Time Warner, Inc. 7.625% 4/15/31	1,000,000		1,209,761
Cox Communications, Inc.:
7.125% 10/1/12	785,000		879,877
7.75% 11/1/10	3,350,000		3,837,405
Liberty Media Corp. 8.25% 2/1/30	1,265,000		1,438,382
News America, Inc. 6.2% 12/15/34 (a)	3,500,000		3,547,310
Time Warner, Inc. 6.625% 5/15/29	1,745,000		1,880,257
			12,792,992
TOTAL CONSUMER DISCRETIONARY			28,855,862
CONSUMER STAPLES - 0.4%
Food Products - 0.1%
ConAgra Foods, Inc. 6.75% 9/15/11	1,870,000		2,103,888
Tobacco - 0.3%
Altria Group, Inc. 7% 11/4/13	955,000		1,034,789
Philip Morris Companies, Inc. 7.65% 7/1/08	2,500,000		2,749,835
			3,784,624
TOTAL CONSUMER STAPLES			5,888,512
ENERGY - 1.9%
Energy Equipment & Services - 0.3%
Petronas Capital Ltd. 7% 5/22/12 (a)	4,320,000		4,948,685
Oil & Gas - 1.6%
Amerada Hess Corp.:
6.65% 8/15/11	445,000		489,355
7.125% 3/15/33	1,145,000		1,258,998
7.375% 10/1/09	1,010,000		1,128,415
Empresa Nacional de Petroleo 6.75% 11/15/12 (a)	5,050,000		5,615,827

	Principal Amount		Value (Note 1)
Enterprise Products Operating LP:
4.625% 10/15/09 (a)	$ 630,000		$ 629,013
5.6% 10/15/14 (a)	445,000		448,947
Kinder Morgan Energy Partners LP 7.125% 3/15/12	1,180,000		1,349,002
Pemex Project Funding Master Trust:
6.125% 8/15/08	3,630,000		3,847,800
7.375% 12/15/14	2,000,000		2,223,000
7.875% 2/1/09 (c)	1,200,000		1,348,200
Ras Laffan Liquid Natural Gas Co. Ltd. yankee 8.294% 3/15/14 (a)	4,370,000		5,163,535
Williams Companies, Inc.:
7.125% 9/1/11	1,055,000		1,152,588
7.5% 1/15/31	505,000		522,675
			25,177,355
TOTAL ENERGY			30,126,040
FINANCIALS - 8.0%
Capital Markets - 1.7%
Credit Suisse First Boston (USA), Inc. 4.625% 1/15/08	3,400,000		3,483,980
Goldman Sachs Group, Inc.:
5.25% 10/15/13	3,270,000		3,345,537
5.7% 9/1/12	2,935,000		3,111,156
6.125% 2/15/33	4,225,000		4,389,230
Merrill Lynch & Co., Inc. 4.125% 1/15/09	7,285,000		7,325,119
Morgan Stanley 6.6% 4/1/12	5,695,000		6,351,730
			28,006,752
Commercial Banks - 1.4%
Bank of America Corp. 7.4% 1/15/11	5,680,000		6,579,587
Corporacion Andina de Fomento 5.2% 5/21/13	1,560,000		1,589,927
Fleet Financial Group, Inc. 7.125% 4/15/06	980,000		1,025,663
Korea Development Bank 3.875% 3/2/09	3,500,000		3,454,626
PNC Funding Corp. 5.75% 8/1/06	4,440,000		4,604,480
SouthTrust Corp. 5.8% 6/15/14	1,440,000		1,524,904
Wachovia Corp. 4.875% 2/15/14	1,455,000		1,450,166
Wells Fargo & Co. 4.2% 1/15/10	1,620,000		1,626,584
Wells Fargo Bank NA, San Francisco 7.55% 6/21/10	900,000		1,045,355
			22,901,292
Consumer Finance - 1.2%
Capital One Bank 4.875% 5/15/08	1,295,000		1,329,988
Ford Motor Credit Co. 7% 10/1/13	4,000,000		4,240,528
General Motors Acceptance Corp. 6.875% 9/15/11	1,860,000		1,906,115
Nonconvertible Bonds - continued
	Principal Amount		Value (Note 1)
FINANCIALS - continued
Consumer Finance - continued
Household Finance Corp.:
4.125% 11/16/09	$ 1,295,000		$ 1,288,037
7% 5/15/12	835,000		953,551
Household International, Inc. 8.875% 2/15/08	3,775,000		3,996,151
MBNA Corp.:
6.25% 1/17/07	1,905,000		2,004,504
7.5% 3/15/12	3,005,000		3,471,670
			19,190,544
Diversified Financial Services - 1.1%
Alliance Capital Management LP 5.625% 8/15/06	2,475,000		2,557,865
Hutchison Whampoa International 03/13 Ltd. 6.5% 2/13/13 (a)	830,000		894,487
Hutchison Whampoa International 03/33 Ltd.:
6.25% 1/24/14 (a)	1,630,000		1,716,555
7.45% 11/24/33 (a)	1,200,000		1,330,066
J.P. Morgan Chase & Co.:
5.75% 1/2/13	3,500,000		3,708,845
6.75% 2/1/11	6,155,000		6,914,570
			17,122,388
Insurance - 0.4%
Axis Capital Holdings Ltd. 5.75% 12/1/14	1,505,000		1,510,882
Marsh & McLennan Companies, Inc. 7.125% 6/15/09	3,109,000		3,374,257
Principal Life Global Funding I 6.25% 2/15/12 (a)	1,350,000		1,475,701
			6,360,840
Real Estate - 1.4%
Arden Realty LP 7% 11/15/07	5,000,000		5,448,715
AvalonBay Communities, Inc. 5% 8/1/07	2,315,000		2,376,644
EOP Operating LP:
4.65% 10/1/10	6,570,000		6,600,025
7% 7/15/11	1,725,000		1,945,357
Mack-Cali Realty LP 7.75% 2/15/11	2,700,000		3,131,144
Simon Property Group LP 5.625% 8/15/14 (a)	2,985,000		3,091,293
			22,593,178
Thrifts & Mortgage Finance - 0.8%
Countrywide Home Loans, Inc.:
4% 3/22/11	2,500,000		2,430,650
4.125% 9/15/09	4,500,000		4,479,827
Independence Community Bank Corp. 3.75% 4/1/14 (c)	1,490,000		1,436,253

	Principal Amount		Value (Note 1)
Washington Mutual, Inc.:
4.375% 1/15/08	$ 2,330,000		$ 2,366,332
4.625% 4/1/14	3,000,000		2,868,159
			13,581,221
TOTAL FINANCIALS			129,756,215
INDUSTRIALS - 0.4%
Aerospace & Defense - 0.2%
Bombardier, Inc.:
6.3% 5/1/14 (a)	2,445,000		2,121,038
7.45% 5/1/34 (a)	840,000		716,100
			2,837,138
Airlines - 0.2%
Delta Air Lines, Inc. pass thru trust certificates:
7.57% 11/18/10	1,335,000		1,316,850
7.92% 5/18/12	3,700,000		2,849,000
			4,165,850
TOTAL INDUSTRIALS			7,002,988
MATERIALS - 0.5%
Chemicals - 0.2%
Lubrizol Corp.:
4.625% 10/1/09	1,155,000		1,153,218
5.5% 10/1/14	540,000		543,182
6.5% 10/1/34	975,000		992,996
			2,689,396
Containers & Packaging - 0.2%
Sealed Air Corp.:
5.625% 7/15/13 (a)	745,000		770,716
6.875% 7/15/33 (a)	1,565,000		1,690,017
			2,460,733
Paper & Forest Products - 0.1%
International Paper Co.:
4.25% 1/15/09	635,000		637,325
5.5% 1/15/14	1,595,000		1,647,654
			2,284,979
TOTAL MATERIALS			7,435,108
TELECOMMUNICATION SERVICES - 3.4%
Diversified Telecommunication Services - 3.1%
AT&T Broadband Corp. 8.375% 3/15/13	1,500,000		1,849,644
Bellsouth Capital Funding Corp. 7.875% 2/15/30	1,920,000		2,391,441
BellSouth Corp. 5.2% 9/15/14	4,000,000		4,076,888
British Telecommunications PLC 8.875% 12/15/30	3,000,000		4,017,063
Nonconvertible Bonds - continued
	Principal Amount		Value (Note 1)
TELECOMMUNICATION SERVICES - continued
Diversified Telecommunication Services - continued
Deutsche Telekom International Finance BV 8.75% 6/15/30	$ 3,250,000		$ 4,291,489
France Telecom SA 9.5% 3/1/31	6,550,000		8,879,128
SBC Communications, Inc. 6.45% 6/15/34	5,400,000		5,785,382
Sprint Capital Corp. 6.875% 11/15/28	2,040,000		2,233,365
Telecom Italia Capital:
4.95% 9/30/14 (a)	1,175,000		1,151,193
5.25% 11/15/13	4,500,000		4,548,308
Telefonica Europe BV 7.75% 9/15/10	1,325,000		1,553,814
Verizon Global Funding Corp.:
7.25% 12/1/10	3,090,000		3,540,173
7.75% 12/1/30	5,000,000		6,216,630
			50,534,518
Wireless Telecommunication Services - 0.3%
America Movil SA de CV:
4.125% 3/1/09	1,585,000		1,561,442
5.5% 3/1/14	1,430,000		1,412,704
AT&T Wireless Services, Inc. 7.875% 3/1/11	1,070,000		1,261,120
			4,235,266
TOTAL TELECOMMUNICATION SERVICES			54,769,784
UTILITIES - 2.8%
Electric Utilities - 1.7%
Cleveland Electric Illuminating Co. 5.65% 12/15/13	3,260,000		3,380,985
DTE Energy Co. 7.05% 6/1/11	2,004,000		2,269,227
Duke Capital LLC:
6.25% 2/15/13	805,000		870,029
6.75% 2/15/32	4,610,000		5,016,639
Exelon Corp. 6.75% 5/1/11	2,250,000		2,516,904
FirstEnergy Corp. 6.45% 11/15/11	830,000		901,770
MidAmerican Energy Holdings, Inc.:
4.625% 10/1/07	1,795,000		1,827,183
5.875% 10/1/12	1,955,000		2,071,598
Monongahela Power Co. 5% 10/1/06	2,260,000		2,300,813
Progress Energy, Inc. 7.1% 3/1/11	4,660,000		5,238,972
			26,394,120

	Principal Amount		Value (Note 1)
Gas Utilities - 0.4%
Consolidated Natural Gas Co. 6.85% 4/15/11	$ 445,000		$ 502,197
NiSource Finance Corp. 7.875% 11/15/10	5,305,000		6,236,447
			6,738,644
Multi-Utilities & Unregulated Power - 0.7%
Constellation Energy Group, Inc. 7% 4/1/12	5,150,000		5,870,228
Dominion Resources, Inc.:
6.25% 6/30/12	4,220,000		4,607,350
8.125% 6/15/10	1,200,000		1,412,438
			11,890,016
TOTAL UTILITIES			45,022,780
TOTAL NONCONVERTIBLE BONDS (Cost $294,867,563)		308,857,289
U.S. Government and Government Agency Obligations - 16.1%

U.S. Government Agency Obligations - 5.8%
Fannie Mae:
2.5% 6/15/06	2,185,000		2,165,711
5.5% 3/15/11	13,505,000		14,482,100
Freddie Mac:
3.625% 9/15/08	8,515,000		8,517,929
4% 6/12/13	4,640,000		4,431,604
4.25% 7/15/09	41,820,000		42,546,873
5.75% 1/15/12	7,740,000		8,432,095
5.875% 3/21/11	6,035,000		6,515,682
6.625% 9/15/09	3,000,000		3,355,023
6.75% 3/15/31	2,459,000		2,988,600
Government Loan Trusts (assets of Trust guaranteed by U.S. Government through Agency for International Development) Series 1-B, 8.5% 4/1/06	463,066		487,548
Guaranteed Export Trust Certificates (assets of Trust guaranteed by U.S. Government through Export-Import Bank):
Series 1993-D, 5.23% 5/15/05	851		857
Series 1994-A, 7.12% 4/15/06	1,758		1,805
Guaranteed Trade Trust Certificates (assets of Trust guaranteed by U.S. Government through Export-Import Bank) Series 1994-B, 7.5% 1/26/06	1,545		1,612
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS			93,927,439
U.S. Government and Government Agency Obligations - continued
	Principal Amount		Value (Note 1)
U.S. Treasury Inflation Protected Obligations - 4.3%
U.S. Treasury Inflation-Indexed Bonds 2.375% 1/15/25	$ 20,251,600		$ 21,655,764
U.S. Treasury Inflation-Indexed Notes:
0.875% 4/15/10	15,112,650		14,965,650
2% 1/15/14	30,989,400		32,074,029
TOTAL U.S. TREASURY INFLATION PROTECTED OBLIGATIONS			68,695,443
U.S. Treasury Obligations - 6.0%
U.S. Treasury Bonds 6.25% 5/15/30	24,015,000		28,711,998
U.S. Treasury Notes:
1.625% 2/28/06	20,000,000		19,728,900
3.125% 5/15/07	14,018,000		14,010,879
3.125% 4/15/09	15,651,000		15,413,793
4% 11/15/12	15,000,000		14,974,800
4.75% 5/15/14	3,685,000		3,840,172
TOTAL U.S. TREASURY OBLIGATIONS			96,680,542
TOTAL U.S. GOVERNMENT AND GOVERNMENT AGENCY OBLIGATIONS (Cost $254,602,153)		259,303,424
U.S. Government Agency - Mortgage Securities - 33.3%

Fannie Mae - 30.1%
3.827% 12/1/34 (c)	100,000		100,219
3.836% 6/1/33 (c)	238,302		238,486
3.941% 10/1/34 (c)	417,235		420,216
4% 8/1/18 to 10/1/18	1,439,521		1,407,933
4% 1/1/20 (b)	33,309,930		32,487,591
4.021% 12/1/34 (c)	325,000		326,930
4.037% 12/1/34 (c)	198,597		200,249
4.048% 1/1/35 (c)	275,000		276,998
4.072% 12/1/34 (c)	525,000		529,102
4.105% 1/1/35 (c)	598,446		596,164
4.17% 11/1/34 (c)	524,964		527,807
4.324% 12/1/34 (c)	199,996		203,240
4.5% 1/1/20 (b)	26,330,000		26,223,034
4.5% 6/1/33 to 10/1/33	18,353,203		17,771,071
4.549% 8/1/34 (c)	723,295		740,282
5% 10/1/17 to 11/1/34	65,999,326		66,519,368
5% 1/1/20 (b)	3,860,997		3,920,119
5% 1/1/35 (b)	64,364,782		63,801,590
5.5% 4/1/13 to 10/1/34	61,742,085		63,191,945
5.5% 1/1/20 (b)	10,003,044		10,334,395
5.5% 1/1/35 (b)	96,316,299		97,670,738
6% 2/1/13 to 1/1/29	15,920,932		16,693,783
6% 1/1/35 (b)	339,133		350,367

	Principal Amount		Value (Note 1)
6.5% 3/1/13 to 2/1/33	$ 69,066,960		$ 72,831,539
6.5% 1/1/20 (b)	2,075,384		2,199,907
7% 3/1/15 to 8/1/32	1,754,660		1,866,752
7.5% 8/1/08 to 11/1/31	3,253,159		3,489,929
8% 3/1/30	3,319		3,599
8.5% 3/1/25 to 6/1/25	3,449		3,793
TOTAL FANNIE MAE		484,927,146
Freddie Mac - 1.9%
4% 1/1/20 (b)	30,000,000		29,287,500
4.985% 8/1/33 (c)	230,759		237,015
8.5% 3/1/20 to 1/1/28	412,357		453,133
TOTAL FREDDIE MAC			29,977,648
Government National Mortgage Association - 1.3%
6% 8/15/08 to 8/15/29	5,360,302		5,578,488
6.5% 10/15/27 to 9/15/32	2,206,764		2,328,848
7% 1/15/28 to 11/15/32	11,905,702		12,659,575
7.5% 3/15/06 to 10/15/28	881,068		950,911
8% 2/15/17	22,696		24,848
TOTAL GOVERNMENT NATIONAL MORTGAGE ASSOCIATION			21,542,670
TOTAL U.S. GOVERNMENT AGENCY - MORTGAGE SECURITIES (Cost $533,760,458)		536,447,464
Asset-Backed Securities - 2.9%

ACE Securities Corp. Series 2004-HE1:
Class M1, 2.9175% 2/25/34 (c)	650,000		650,110
Class M2, 3.5175% 2/25/34 (c)	725,000		725,257
AmeriCredit Automobile Receivables Trust Series 2003-BX Class A4B, 2.7113% 1/6/10 (c)	1,570,000		1,578,517
Ameriquest Mortgage Securities, Inc. Series 2004-R2:
Class M1, 2.8475% 4/25/34 (c)	360,000		360,006
Class M2, 2.8975% 4/25/34 (c)	275,000		275,005
Amortizing Residential Collateral Trust Series 2003-BC1 Class M2, 3.5175% 1/25/32 (c)	745,000		748,078
Argent Securities, Inc. Series 2004-W5 Class M1, 3.0175% 4/25/34 (c)	1,165,000		1,166,549
Capital One Multi-Asset Execution Trust:
Series 2003-B4 Class B4, 3.2025% 7/15/11 (c)	2,230,000		2,270,635
Series 2004-6 Class B, 4.15% 7/16/12	3,005,000		3,001,788
Asset-Backed Securities - continued
	Principal Amount		Value (Note 1)
Chase Manhattan Auto Owner Trust Series 2001-A Class A4, 5.07% 2/15/08	$ 2,725,723		$ 2,737,094
Citibank Credit Card Issuance Trust Series 2002-C1 Class C1, 3.2% 2/9/09 (c)	4,500,000		4,560,055
Countrywide Home Loans, Inc.:
Series 2004-2 Class M1, 2.9175% 5/25/34 (c)	1,525,000		1,525,025
Series 2004-3 Class M1, 2.9175% 6/25/34 (c)	425,000		425,437
Discover Card Master Trust I:
Series 2001-6 Class A, 5.75% 12/15/08	7,000,000		7,247,648
Series 2003-4 Class B1, 2.7325% 5/16/11 (c)	2,620,000		2,633,966
First Franklin Mortgage Loan Trust Series 2004-FF2:
Class M3, 2.9675% 3/25/34 (c)	125,000		125,002
Class M4, 3.3175% 3/25/34 (c)	100,000		100,002
Class M6, 3.6675% 3/25/34 (c)	100,000		100,103
Fremont Home Loan Trust Series 2004-A:
Class M1, 2.9675% 1/25/34 (c)	1,350,000		1,350,023
Class M2, 3.5675% 1/25/34 (c)	1,550,000		1,550,025
GSAMP Trust Series 2004-FM2:
Class M1, 2.9175% 1/25/34 (c)	1,000,000		1,000,017
Class M2, 3.5175% 1/25/34 (c)	400,000		400,006
Class M3, 3.7175% 1/25/34 (c)	400,000		400,006
Home Equity Asset Trust Series 2002-4 Class M2, 4.4675% 3/25/33 (c)	550,000		558,167
MBNA Credit Card Master Note Trust:
Series 2001-A1 Class A1, 5.75% 10/15/08	1,800,000		1,860,648
Series 2003-B3 Class B3, 2.7775% 1/18/11 (c)	1,810,000		1,817,912
Series 2003-B5 Class B5, 2.7725% 2/15/11 (c)	725,000		730,714
Meritage Mortgage Loan Trust Series 2004-1:
Class M1, 2.9175% 7/25/34 (c)	625,000		625,010
Class M2, 2.9675% 7/25/34 (c)	100,000		100,002
Class M3, 3.3675% 7/25/34 (c)	225,000		225,004
Class M4, 3.5175% 7/25/34 (c)	150,000		150,002
Morgan Stanley ABS Capital I, Inc.:
Series 2003-HE1 Class M2, 4.3175% 5/25/33 (c)	455,000		461,360
Series 2003-NC5 Class M2, 4.4175% 4/25/33 (c)	825,000		840,240
Morgan Stanley Dean Witter Capital I Trust Series 2003-NC1 Class M1, 3.4675% 11/25/32 (c)	750,000		757,973

	Principal Amount		Value (Note 1)
Sears Credit Account Master Trust II Series 2000-2 Class A, 6.75% 9/16/09	$ 2,255,000		$ 2,311,306
Structured Asset Securities Corp. Series 2004-GEL1 Class A, 2.7775% 2/25/34 (c)	430,021		430,028
TOTAL ASSET-BACKED SECURITIES (Cost $45,313,325)		45,798,720
Collateralized Mortgage Obligations - 2.5%

Private Sponsor - 0.4%
CS First Boston Mortgage Securities Corp. floater Series 2004-AR3 Class 6A2, 2.7875% 4/25/34 (c)	1,089,516		1,091,124
Master Alternative Loan Trust Series 2004-3 Class 3A1, 6% 4/25/34	537,160		549,918
Residential Asset Mortgage Products, Inc. sequential pay Series 2004-SL2 Class A1, 6.5% 10/25/16	533,256		547,754
Residential Finance LP/Residential Finance Development Corp. floater Series 2003-CB1:
Class B3, 3.82% 6/10/35 (a)(c)	1,204,144		1,225,148
Class B4, 4.02% 6/10/35 (a)(c)	1,077,392		1,096,013
Class B5, 4.62% 6/10/35 (a)(c)	736,136		752,033
Class B6, 5.12% 6/10/35 (a)(c)	433,882		444,498
TOTAL PRIVATE SPONSOR			5,706,488
U.S. Government Agency - 2.1%
Fannie Mae guaranteed REMIC pass thru certificates planned amortization class Series 2004-81 Class KD:
4.5% 4/25/17	5,810,000		5,845,071
4.5% 7/25/18	2,455,000		2,435,349
Freddie Mac Multi-class participation certificates guaranteed:
planned amortization class:
Series 2500 Class TE, 5.5% 9/15/17	10,275,186		10,665,935
Series 2677 Class LD, 4.5% 3/15/17	8,240,218		8,237,308
Series 2702 Class WB, 5% 4/15/17	2,947,632		3,001,500
Collateralized Mortgage Obligations - continued
	Principal Amount		Value (Note 1)
U.S. Government Agency - continued
Freddie Mac Multi-class participation certificates guaranteed: - continued
Series 2885 Class PC, 4.5% 3/15/18	$ 2,395,000		$ 2,408,900
sequential pay Series 2750 Class ZT, 5% 2/15/34	2,022,366		1,816,512
TOTAL U.S. GOVERNMENT AGENCY			34,410,575
TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS (Cost $40,082,274)		40,117,063
Commercial Mortgage Securities - 5.3%

Bayview Commercial Asset Trust floater Series 2004-3:
Class A1, 2.7675% 1/25/35 (a)(c)	1,996,572		1,996,572
Class A2, 2.8175% 1/25/35 (a)(c)	299,486		299,486
Class M1, 2.8975% 1/25/35 (a)(c)	349,400		349,400
Class M2, 3.3975% 1/25/35 (a)(c)	199,657		199,657
Chase Commercial Mortgage Securities Corp. Series 2001-245 Class A2, 6.4842% 2/12/16 (a)(c)	1,345,000		1,480,952
Chase Manhattan Bank-First Union National Bank Commercial Mortgage Trust sequential pay Series 1999-1 Class A2, 7.439% 8/15/31	5,000,000		5,655,220
COMM:
floater:
Series 2002-FL7 Class D, 2.9725% 11/15/14 (a)(c)	735,000		736,981
Series 2003-FL9 Class B, 2.9025% 11/15/15 (a)(c)	1,381,378		1,385,501
Series 2004-LBN2 Class X2, 1.2743% 3/10/39 (a)(c)(e)	4,982,239		212,451
Commercial Resecuritization Trust sequential pay Series 1999-ABC1 Class A, 6.74% 1/27/09 (a)	2,777,685		2,863,595
CS First Boston Mortgage Securities Corp.:
floater Series 2003-TF2A Class A2, 2.7225% 11/15/14 (a)(c)	2,500,000		2,503,720
sequential pay:
Series 1997-C2 Class A3, 6.55% 1/17/35	2,075,000		2,217,635

	Principal Amount		Value (Note 1)
Series 1999-C1 Class A2, 7.29% 9/15/41	$ 3,500,000		$ 3,929,188
Series 2000-C1 Class A2, 7.545% 4/15/62	1,100,000		1,255,886
Series 2004-C1 Class A3, 4.321% 1/15/37	1,505,000		1,495,934
Series 1997-C2 Class D, 7.27% 1/17/35	1,750,000		1,934,027
Series 1998-C1 Class C, 6.78% 5/17/40	5,000,000		5,477,787
Series 2001-CKN5 Class AX, 1.2221% 9/15/34 (a)(c)(e)	31,167,356		2,067,920
Series 2004-C1 Class ASP, 1.0446% 1/15/37 (a)(c)(e)	24,490,000		979,456
Deutsche Mortgage & Asset Receiving Corp. sequential pay Series 1998-C1 Class D, 7.231% 6/15/31	1,120,000		1,231,926
DLJ Commercial Mortgage Corp. sequential pay Series 2000-CF1 Class A1B, 7.62% 6/10/33	3,000,000		3,439,172
Equitable Life Assurance Society of the United States Series 174:
Class B1, 7.33% 5/15/06 (a)	500,000		524,151
Class C1, 7.52% 5/15/06 (a)	500,000		524,874
Fannie Mae sequential pay Series 1999-10 Class MZ, 6.5% 9/17/38	3,984,632		4,220,299
GGP Mall Properties Trust sequential pay Series 2001-C1A Class A2, 5.007% 11/15/11 (a)	3,404,715		3,485,457
Ginnie Mae guaranteed REMIC pass thru securities sequential pay:
Series 2002-83 Class B, 4.6951% 12/16/24	1,860,000		1,896,043
Series 2003-22 Class B, 3.963% 5/16/32	3,295,000		3,244,752
GS Mortgage Securities Corp. II:
sequential pay:
Series 2001-LIBA Class A2, 6.615% 2/14/16 (a)	1,645,000		1,811,739
Series 2003-C1 Class A2A, 3.59% 1/10/40	3,220,000		3,205,018
Series 1998-GLII Class E, 7.1905% 4/13/31 (c)	245,000		257,161
J.P. Morgan Commercial Mortgage Finance Corp. sequential pay Series 2000-C9 Class A2, 7.77% 10/15/32	3,745,000		4,292,622
LB-UBS Commercial Mortgage Trust sequential pay:
Series 2000-C3 Class A2, 7.95% 1/15/10	2,180,000		2,531,131
Series 2001-C3 Class A1, 6.058% 6/15/20	5,143,053		5,430,523
Commercial Mortgage Securities - continued
	Principal Amount		Value (Note 1)
Leafs CMBS I Ltd./Leafs CMBS I Corp. Series 2002-1A:
Class B, 4.13% 11/20/37 (a)	$ 2,600,000		$ 2,483,609
Class C, 4.13% 11/20/37 (a)	2,600,000		2,372,500
Morgan Stanley Capital I, Inc. sequential pay Series 2004-HQ3 Class A2, 4.05% 1/13/41	1,480,000		1,468,969
Thirteen Affiliates of General Growth Properties, Inc. sequential pay Series 1 Class A2, 6.602% 11/15/07 (a)	2,500,000		2,662,191
Trizechahn Office Properties Trust Series 2001-TZHA Class E3, 7.253% 3/15/13 (a)	1,390,000		1,479,325
Wachovia Bank Commercial Mortgage Trust sequential pay Series 2003-C6 Class A2, 4.498% 8/15/35	2,385,000		2,418,940
TOTAL COMMERCIAL MORTGAGE SECURITIES (Cost $83,512,571)		86,021,770
Foreign Government and Government Agency Obligations - 1.4%

Chilean Republic:
5.625% 7/23/07	2,300,000		2,407,813
7.125% 1/11/12	3,470,000		3,983,994
Korean Republic 4.875% 9/22/14	1,700,000		1,681,492
State of Israel 4.625% 6/15/13	725,000		692,828
United Mexican States:
5.875% 1/15/14	1,295,000		1,326,728
6.75% 9/27/34	3,835,000		3,787,063
7.5% 4/8/33	8,587,000		9,273,960
TOTAL FOREIGN GOVERNMENT AND GOVERNMENT AGENCY OBLIGATIONS (Cost $21,947,236)		23,153,878
Supranational Obligations - 0.1%

Corporacion Andina de Fomento 6.875% 3/15/12 (Cost $1,706,548)	1,725,000		1,938,536
Fixed-Income Funds - 11.8%
	Shares
Fidelity Ultra-Short Central Fund (d) (Cost $189,752,518)	1,909,521		190,016,425
Cash Equivalents - 23.7%
	Maturity Amount		Value (Note 1)
Investments in repurchase agreements (Collateralized by U.S. Government Obligations), in a joint trading account at 2.28%, dated 12/31/04 due 1/3/05 (Cost $381,814,000) (f)	$ 381,886,429		$ 381,814,000
TOTAL INVESTMENT PORTFOLIO - 116.3% (Cost $1,847,358,646)		1,873,468,569
NET OTHER ASSETS - (16.3)%			(262,052,423)
NET ASSETS - 100%		$ 1,611,416,146

Swap Agreements
	Expiration Date	Notional Amount
Credit Default Swap
Receive quarterly notional amount multiplied by .38% and pay Merrill Lynch, Inc. upon default event of EnCana Corp., par value of the notional amount of EnCana Corp. 4.75% 10/15/13	March 2009	$ 1,800,000	5,856
Receive quarterly notional amount multiplied by .38% and pay Merrill Lynch, Inc. upon default event of EnCana Corp., par value of the notional amount of EnCana Corp. 4.75% 10/15/13	March 2009	700,000	2,277
Swap Agreements - continued
	Expiration Date	Notional Amount	Value
Credit Default Swap - continued
Receive quarterly notional amount multiplied by .41% and pay Merrill Lynch, Inc. upon default event of Talisman Energy, Inc., par value of the notional amount of Talisman Energy, Inc. 7.25% 10/15/27	March 2009	$ 1,400,000	$ 5,112
Receive quarterly notional amount multiplied by .87% and pay Merrill Lynch, Inc. upon default of Raytheon Co., par value of the notional amount of Raytheon Co. 5.375% 4/1/13	June 2008	5,000,000	96,314
TOTAL CREDIT DEFAULT SWAP		8,900,000	109,559
Interest Rate Swap
Receive quarterly a fixed rate equal to 3.524% and pay quarterly a floating rate based on 3-month LIBOR with Morgan Stanley, Inc.	May 2007	12,000,000	17,987
Recieve quarterly a fixed rate equal to 2.83852% and pay quarterly a floating rate based on 3-month LIBOR with Credit Suisse First Boston	Oct. 2006	90,000,000	(684,270)
TOTAL INTEREST RATE SWAP		102,000,000	(666,283)
Total Return Swap
Receive monthly a return equal to Lehman Brothers for CMBS AAA 8.5+ Index and pay monthly a floating rate based on 1-month LIBOR minus 40 basis points with Lehman Brothers, Inc.	April 2005	10,000,000	103,426

	Expiration Date	Notional Amount	Value
Receive quarterly a return equal to Banc of America Securities LLC AAA 10Yr Commercial Mortgage-Backed Securities Daily Index and pay quarterly a floating rate based on 3-month LIBOR minus 72 basis points with Bank of America	Jan. 2005	$ 10,000,000	$ (34,704)
Receive quarterly a return equal to that of Banc of America Securities LLC AAA 10Yr Commercial Mortgage Backed Securities Daily Index and pay quarterly a floating rate based on 3-month LIBOR minus 30 basis points with Bank of America	May 2005	10,000,000	(11,122)
Receive quarterly a return equal to that of Banc of America Securities LLC AAA 10Yr Commercial Mortgage-Backed Securities Daily Index and pay quarterly a floating rate based on 3-month LIBOR minus 27 basis points with Bank of America	June 2005	10,000,000	133,074
TOTAL TOTAL RETURN SWAP		40,000,000	190,674
		$ 150,900,000	$ (366,050)

Legend

(a) Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At the period end, the value of these securities amounted to 69,247,712 or 4.3% of net assets.

(b) Security or a portion of the security purchased on a delayed delivery or when-issued basis.

(d) Affiliated fund that is available only to investment companies and other accounts managed by Fidelity Investments. A complete listing of the fund's holdings as of its most recent fiscal year end is available upon request.

(e) Security represents right to receive monthly interest payments on an underlying pool of mortgages. Principal shown is the par amount of the mortgage pool.

(f) Additional information on each counterparty to the repurchase agreement is as follows:

Repurchase Agreement/ Counterparty	Value
$381,814,000 due 1/3/05 at 2.28%
Banc of America Securities LLC.	$ 58,606,652
Bank of America, National Association	44,231,435
Barclays Capital Inc.	53,837,906
Bear Stearns & Co. Inc.	33,173,577
Countrywide Securities Corporation	5,528,929
Goldman, Sachs & Co.	44,231,435
J.P. Morgan Securities, Inc.	11,057,859
Morgan Stanley & Co. Incorporated.	26,096,547
UBS Securities LLC	66,347,154
Wachovia Capital Markets, LLC	27,644,647
WestLB AG	11,057,859
	$ 381,814,000

Income Tax Information

The fund hereby designates as capital gain dividends: For dividends with respect to the taxable year ended December 31, 2004, $24,301,000 or, if different, the net capital gain of such year, and for dividends with respect to the taxable year ended December 31, 2003, $17,470,000 or, if different, the excess of (a) the net capital gain of such year, over (b) amounts previously designated as capital gain dividends with respect to such year.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products: Investment Grade Bond Portfolio

Financial Statements

Statement of Assets and Liabilities

	December 31, 2004
Assets
Investment in securities, at value (including repurchase agreements of $381,814,000) (cost $1,847,358,646) - See accompanying schedule		$ 1,873,468,569
Receivable for investments sold		738,404
Receivable for fund shares sold		1,404,617
Interest receivable		10,894,032
Prepaid expenses		6,062
Total assets		1,886,511,684

Liabilities
Payable to custodian bank	$ 3,700
Payable for investments purchased Regular delivery	4,411,984
Delayed delivery	268,030,904
Payable for fund shares redeemed	1,321,796
Swap agreements, at value	366,050
Accrued management fee	569,169
Distribution fees payable	42,089
Other affiliated payables	141,569
Other payables and accrued expenses	208,277
Total liabilities		275,095,538

Net Assets		$ 1,611,416,146
Net Assets consist of:
Paid in capital		$ 1,492,685,250
Undistributed net investment income		59,329,661
Accumulated undistributed net realized gain (loss) on investments		33,657,362
Net unrealized appreciation (depreciation) on investments		25,743,873
Net Assets		$ 1,611,416,146

Initial Class: Net Asset Value, offering price and redemption price per share ($1,374,971,627 ÷ 103,761,799 shares)		$ 13.25

Service Class: Net Asset Value, offering price and redemption price per share ($50,142,834 ÷ 3,803,176 shares)		$ 13.18

Service Class 2: Net Asset Value, offering price and redemption price per share ($186,301,685 ÷ 14,241,911 shares)		$ 13.08

Statement of Operations

	Year ended December 31, 2004
Investment Income
Interest		$ 66,998,813
Security lending		45,551
Total income		67,044,364

Expenses
Management fee	$ 6,787,838
Transfer agent fees	1,083,006
Distribution fees	402,351
Accounting and security lending fees	621,799
Non-interested trustees' compensation	8,868
Custodian fees and expenses	80,161
Audit	53,510
Legal	3,436
Miscellaneous	243,840
Total expenses before reductions	9,284,809
Expense reductions	(3,322)	9,281,487
Net investment income		57,762,877
Realized and Unrealized Gain (Loss) Net realized gain (loss) on:
Investment securities	34,123,429
Swap agreements	3,049,746
Total net realized gain (loss)		37,173,175
Change in net unrealized appreciation (depreciation) on: Investment securities	(25,733,829)
Swap agreements	(947,280)
Delayed delivery commitments	(6,281)
Total change in net unrealized appreciation (depreciation)		(26,687,390)
Net gain (loss)		10,485,785
Net increase (decrease) in net assets resulting from operations		$ 68,248,662

See accompanying notes which are an integral part of the financial statements.

Investment Grade Bond Portfolio

Statement of Changes in Net Assets

	Year ended December 31, 2004	Year ended December 31, 2003
Increase (Decrease) in Net Assets
Operations
Net investment income	$ 57,762,877	$ 67,814,156
Net realized gain (loss)	37,173,175	46,329,913
Change in net unrealized appreciation (depreciation)	(26,687,390)	(17,351,198)
Net increase (decrease) in net assets resulting from operations	68,248,662	96,792,871
Distributions to shareholders from net investment income	(66,752,508)	(82,217,412)
Distributions to shareholders from net realized gain	(48,129,691)	(28,967,100)
Total distributions	(114,882,199)	(111,184,512)
Share transactions - net increase (decrease)	(4,083,226)	(361,117,397)
Total increase (decrease) in net assets	(50,716,763)	(375,509,038)

Net Assets
Beginning of period	1,662,132,909	2,037,641,947
End of period (including undistributed net investment income of $59,329,661 and undistributed net investment income of $68,804,726, respectively)	$ 1,611,416,146	$ 1,662,132,909

Other Information:
Share Transactions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2
Shares Sold	8,574,911	3,638,367	8,102,610
Reinvested	8,127,198	133,843	666,249
Redeemed	(24,926,667)	(1,314,273)	(3,077,343)
Net increase (decrease)	(8,224,558)	2,457,937	5,691,516

Dollars Sold	$ 111,904,360	$ 47,309,999	$ 104,259,091
Reinvested	104,678,315	1,715,870	8,488,014
Redeemed	(325,781,316)	(17,025,100)	(39,632,459)
Net increase (decrease)	$ (109,198,641)	$ 32,000,769	$ 73,114,646
Share Transactions	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2
Shares Sold	23,978,195	1,752,061	7,214,822
Reinvested	8,213,993	2,020	300,111
Redeemed	(63,630,168)	(480,248)	(4,242,792)
Net increase (decrease)	(31,437,980)	1,273,833	3,272,141

Dollars Sold	$ 320,978,012	$ 23,516,680	$ 95,735,008
Reinvested	107,274,755	26,323	3,883,434
Redeemed	(849,723,435)	(6,448,689)	(56,359,485)
Net increase (decrease)	$ (421,470,668)	$ 17,094,314	$ 43,258,957
Distributions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2
From net investment income	$ 60,884,326	$ 1,005,257	$ 4,862,925
From net realized gain	43,793,989	710,613	3,625,089
Total	$ 104,678,315	$ 1,715,870	$ 8,488,014
	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2
From net investment income	$ 79,353,928	$ 19,279	$ 2,844,205
From net realized gain	27,920,827	7,044	1,039,229
Total	$ 107,274,755	$ 26,323	$ 3,883,434

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Initial Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 13.65	$ 13.70	$ 12.92	$ 12.59	$ 12.16
Income from Investment Operations
Net investment income^C	.476	.467	.610	.685^E	.771
Net realized and unrealized gain (loss)	.104	.213	.680	.335^E	.499
Total from investment operations	.580	.680	1.290	1.020	1.270
Distributions from net investment income	(.570)	(.540)	(.510)	(.690)	(.840)
Distributions from net realized gain	(.410)	(.190)	-	-	-
Total distributions	(.980)	(.730)	(.510)	(.690)	(.840)
Net asset value, end of period	$ 13.25	$ 13.65	$ 13.70	$ 12.92	$ 12.59
Total Return^{A, B}	4.46%	5.20%	10.34%	8.46%	11.22%
Ratios to Average Net Assets^D
Expenses before expense reductions	.56%	.54%	.54%	.54%	.54%
Expenses net of voluntary waivers, if any	.56%	.54%	.54%	.54%	.54%
Expenses net of all reductions	.56%	.54%	.53%	.54%	.54%
Net investment income	3.65%	3.48%	4.71%	5.47%^E	6.50%
Supplemental Data
Net assets, end of period (000 omitted)	$ 1,374,972	$ 1,528,417	$ 1,965,036	$ 1,445,925	$ 739,911
Portfolio turnover rate	170%	218%	192%	278%	154%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

Financial Highlights - Service Class

Years ended December 31,	2004	2003	2002	2001	2000^F
Selected Per-Share Data
Net asset value, beginning of period	$ 13.61	$ 13.66	$ 12.89	$ 12.58	$ 11.80
Income from Investment Operations
Net investment income^E	.456	.448	.591	.674^H	.377
Net realized and unrealized gain (loss)	.104	.212	.679	.326^H	.403
Total from investment operations	.560	.660	1.270	1.000	.780
Distributions from net investment income	(.580)	(.520)	(.500)	(.690)	-
Distributions from net realized gain	(.410)	(.190)	-	-	-
Total distributions	(.990)	(.710)	(.500)	(.690)	-
Net asset value, end of period	$ 13.18	$ 13.61	$ 13.66	$ 12.89	$ 12.58
Total Return^{B, C, D}	4.32%	5.06%	10.20%	8.30%	6.61%
Ratios to Average Net Assets^G
Expenses before expense reductions	.66%	.64%	.64%	.64%	.64%^A
Expenses net of voluntary waivers, if any	.66%	.64%	.64%	.64%	.64%^A
Expenses net of all reductions	.66%	.64%	.64%	.64%	.64%^A
Net investment income	3.54%	3.38%	4.60%	5.37%^H	6.40%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 50,143	$ 18,305	$ 975	$ 115	$ 107
Portfolio turnover rate	170%	218%	192%	278%	154%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F For the period July 7, 2000 (commencement of sale of shares) to December 31, 2000.

See accompanying notes which are an integral part of the financial statements.

Investment Grade Bond Portfolio

Financial Highlights - Service Class 2

Years ended December 31,	2004	2003	2002	2001	2000^F
Selected Per-Share Data
Net asset value, beginning of period	$ 13.50	$ 13.57	$ 12.82	$ 12.54	$ 12.06
Income from Investment Operations
Net investment income^E	.435	.427	.571	.643^H	.686
Net realized and unrealized gain (loss)	.105	.213	.679	.327^H	.634
Total from investment operations	.540	.640	1.250	.970	1.320
Distributions from net investment income	(.550)	(.520)	(.500)	(.690)	(.840)
Distributions from net realized gain	(.410)	(.190)	-	-	-
Total distributions	(.960)	(.710)	(.500)	(.690)	(.840)
Net asset value, end of period	$ 13.08	$ 13.50	$ 13.57	$ 12.82	$ 12.54
Total Return^{B, C, D}	4.19%	4.94%	10.09%	8.08%	11.69%
Ratios to Average Net Assets^G
Expenses before expense reductions	.81%	.79%	.79%	.82%	1.75%^A
Expenses net of voluntary waivers, if any	.81%	.79%	.79%	.82%	1.05%^A
Expenses net of all reductions	.81%	.79%	.79%	.82%	1.05%^A
Net investment income	3.39%	3.23%	4.45%	5.19%^H	5.99%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 186,302	$ 115,411	$ 71,631	$ 18,225	$ 229
Portfolio turnover rate	170%	218%	192%	278%	154%

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E Calculated based on average shares outstanding during the period.

^F For the period January 12, 2000 (commencement of sale of shares) to December 31, 2000.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products: Mid Cap Portfolio

Performance: The Bottom Line

Average Annual Total Returns

Periods ended December 31, 2004	Past 1 year	Past 5 years	Life of fund ^A
Fidelity ® VIP: Mid Cap Portfolio - Initial Class	24.92%	15.11%	20.74%
Fidelity VIP: Mid Cap Portfolio - Service Class ^B	24.77%	14.98%	20.61%
Fidelity VIP: Mid Cap Portfolio - Service Class 2 ^C	24.60%	14.81%	20.46%

^A From December 28, 1998.

^B Performance for Service Class shares reflects an asset based distribution fee (12b-1).

^C The initial offering of Service Class 2 shares took place January 12, 2000. Performance for Service Class 2 shares reflects an asset based distribution fee (12b-1 fee). Returns from December 28, 1998 to January 12, 2000 are those of Service Class which reflect a different 12b-1 fee. Had Service Class 2's 12b-1 fee been reflected, returns prior to January 12, 2000 would have been lower.

$10,000 Over Life of Fund

Let's say hypothetically that $10,000 was invested in Fidelity® Variable Insurance Products: Mid Cap Portfolio - Initial Class on December 28, 1998, when the fund started. The chart shows how the value of your investment would have changed, and also shows how the S&P® MidCap 400 Index performed the same period.

Mid Cap Portfolio

Fidelity Variable Insurance Products: Mid Cap Portfolio

Management's Discussion of Fund Performance

Comments from Thomas Allen, Portfolio Manager of Fidelity® Variable Insurance Products: Mid Cap Portfolio

For the 12-month period that ended December 31, 2004, the fund solidly outperformed both the Standard & Poor's® MidCap 400 Index, which gained 16.48%, and the Lipper^SM Variable Annuity Mid-Cap Funds Average, which rose 15.30%. Rising oil prices helped boost many energy stocks during the period, and the fund was fortunate to own some of those that rose more than others, including Southwestern Energy and PetroKazakhstan, based in the former Soviet Union. Favorable stock selection in health care equipment and services companies, such as pharmacy benefits manager Caremark Rx, also helped the fund beat its index, as did an underweighting in the weak semiconductor group. The fund's overweighting in materials turned out to be a double-edged sword: Steel stocks worked very well, driven by tight supply, increasing demand from emerging markets and a moderately weaker U.S. dollar, while our gold-related holdings performed poorly, including such names as Newmont Mining, Buenaventura Mining and Harmony Gold.

Annual Report

Fidelity Variable Insurance Products Fund: Mid Cap Portfolio

Investment Summary

Top Five Stocks as of December 31, 2004
	% of fund's net assets
Newmont Mining Corp.	2.5
Nucor Corp.	2.4
Invitrogen Corp.	2.4
Steel Dynamics, Inc.	1.6
Charles River Laboratories International, Inc.	1.6
	10.5
Top Five Market Sectors as of December 31, 2004
	% of fund's net assets
Materials	18.4
Health Care	15.9
Energy	13.5
Industrials	11.2
Consumer Discretionary	11.0

Asset Allocation as of December 31, 2004
% of fund's net assets *
	Stocks	96.7%
	Short-Term Investments and Net Other Assets	3.3%

* Foreign investments 27.3%

Mid Cap Portfolio

Fidelity Variable Insurance Products Fund: Mid Cap Portfolio

Investments December 31, 2004

Showing Percentage of Net Assets

Common Stocks - 96.7%
	Shares		Value (Note 1)
CONSUMER DISCRETIONARY - 11.0%
Auto Components - 1.7%
Amerigon, Inc. (a)	100		$ 374
Autoliv, Inc.	144,100		6,960,030
Bharat Forge Ltd.	55,244		1,373,947
BorgWarner, Inc.	146,100		7,914,237
China Yuchai International Ltd. (a)	100		1,328
Continental AG	100		6,339
Gentex Corp.	532,100		19,698,342
IMPCO Technologies, Inc. (a)(e)	1,506,400		11,373,320
Johnson Controls, Inc.	200		12,688
LKQ Corp. (a)	315,337		6,328,814
Nokian Tyres Ltd.	96,700		14,665,743
Starcraft Corp. (a)	105		1,469
			68,336,631
Automobiles - 0.1%
Bajaj Auto Ltd.	35,300		923,268
Denway Motors Ltd.	4,000		1,428
Fiat Spa sponsord ADR (a)	100		798
Harley-Davidson, Inc.	100		6,075
Hero Honda Motors Ltd.	221,071		2,925,549
Mahindra & Mahindra Ltd.	100		1,261
Maruti Udyog Ltd.	100		1,068
Tata Motors Ltd.	100		1,168
Thor Industries, Inc.	200		7,410
			3,868,025
Distributors - 0.0%
Educational Development Corp.	100		1,044
Li & Fung Ltd.	2,000		3,371
			4,415
Hotels, Restaurants & Leisure - 3.1%
Accor SA	100		4,369
AFC Enterprises, Inc. (a)	100		2,365
Applebee's International, Inc.	150		3,968
BJ's Restaurants, Inc. (a)	100		1,400
Buffalo Wild Wings, Inc. (a)	208,000		7,240,480
Jack in the Box, Inc. (a)	23,600		870,132
Jurys Doyle Hotel Group PLC (Ireland)	100		1,671
Krispy Kreme Doughnuts, Inc. (a)	100		1,260
Kuoni Reisen Holding AG Class B (Reg.)	100		43,881
Outback Steakhouse, Inc.	773,700		35,419,986
P.F. Chang's China Bistro, Inc. (a)	100		5,635
Red Robin Gourmet Burgers, Inc. (a)	198,000		10,587,060
Royal Caribbean Cruises Ltd.	511,000		27,818,840
Sonic Corp. (a)	1,372,825		41,871,163
Total Entertainment Restaurant Corp. (a)	100		1,192
			123,873,402
Household Durables - 1.3%
Alba PLC	581,101		7,137,036
Arcelik AS (a)	100		1
Fedders Corp.	100		362
Garmin Ltd.	51		3,103

	Shares		Value (Note 1)
George Wimpey PLC	100		$ 776
Harman International Industries, Inc.	118,400		15,036,800
Hovnanian Enterprises, Inc. Class A (a)	200		9,904
LG Electronics, Inc.	167,270		10,357,427
Makita Corp. sponsored ADR	100		1,775
Rational AG	39,471		3,665,649
Sekisui House Ltd.	877,000		10,222,962
Skyworth Digital Holdings Ltd.	2,052		306
Toll Brothers, Inc. (a)	105,000		7,204,050
William Lyon Homes, Inc. (a)	100		7,024
			53,647,175
Internet & Catalog Retail - 0.2%
1-800-FLOWERS.com, Inc. Class A (a)	200		1,682
Alloy, Inc. (a)	100		807
Audible, Inc. (a)	100		2,605
GSI Commerce, Inc. (a)	100		1,778
Overstock.com, Inc. (a)	100		6,900
Provide Commerce, Inc.	65,200		2,422,180
Rakuten, Inc. (d)	301		343,815
Rakuten, Inc. New (a)(d)	2,709		3,094,338
ValueVision Media, Inc. Class A (a)	100		1,391
			5,875,496
Leisure Equipment & Products - 0.1%
Arctic Cat, Inc.	100		2,652
Asia Optical Co., Inc.	28,718		159,896
Jumbo SA	295,690		2,302,419
Mega Bloks, Inc. (a)	100		1,588
Oakley, Inc.	100		1,275
Polaris Industries, Inc.	200		13,604
SCP Pool Corp.	225		7,178
SHIMANO, Inc.	100		2,856
			2,491,468
Media - 0.6%
Astral Media, Inc. Class A (non-vtg.)	365,800		9,931,470
Chum Ltd. Class B (non-vtg.)	200		4,958
Clear Media Ltd. (a)	243,000		226,656
Cumulus Media, Inc. Class A (a)	100		1,508
E.W. Scripps Co. Class A	100		4,828
Fox Entertainment Group, Inc. Class A (a)	100		3,126
Gemstar-TV Guide International, Inc. (a)	100		592
Getty Images, Inc. (a)	100		6,885
Grupo Televisa SA de CV sponsored ADR	100		6,050
Harris Interactive, Inc. (a)	100		790
Impresa SGPS (a)	100		787
Insignia Systems, Inc. (a)	100		218
JC Decaux SA (a)	100		2,914
Modern Times Group AB (MTG) (B Shares) (a)	100		2,724
Padmalaya Telefilms Ltd. (a)	100		122
Saga Communications, Inc. Class A (a)	100		1,685
Salem Communications Corp. Class A (a)	48,300		1,205,085
SBS Broadcasting SA (a)	100		4,023
Scholastic Corp. (a)	100		3,696
Common Stocks - continued
	Shares		Value (Note 1)
CONSUMER DISCRETIONARY - continued
Media - continued
SKY Perfect Communications, Inc.	5,512		$ 5,973,172
Sogecable SA (a)	100		4,430
Spanish Broadcasting System, Inc. Class A (a)	100		1,056
TiVo, Inc. (a)	100		587
Trader Classified Media NV (A Shares)	100		1,384
Zee Telefilms Ltd.	1,820,140		7,219,538
			24,608,284
Multiline Retail - 0.1%
99 Cents Only Stores (a)	100		1,616
Dollar General Corp.	100		2,077
Dollar Tree Stores, Inc. (a)	100		2,868
Don Quijote Co. Ltd. (d)	113,100		5,774,802
Family Dollar Stores, Inc.	100		3,123
			5,784,486
Specialty Retail - 2.7%
Abercrombie & Fitch Co. Class A	100		4,695
AC Moore Arts & Crafts, Inc. (a)	705,100		20,313,931
Advance Auto Parts, Inc. (a)	200		8,736
Aeropostale, Inc. (a)	100		2,943
Best Buy Co., Inc.	200		11,884
CarMax, Inc. (a)	622,400		19,325,520
Chico's FAS, Inc. (a)	100		4,553
Cost Plus, Inc. (a)	142,700		4,584,951
Esprit Holdings Ltd.	500		3,023
French Connection Group PLC	100		471
Genesco, Inc. (a)	100		3,114
Guitar Center, Inc. (a)	100		5,269
Hot Topic, Inc. (a)	323,883		5,567,549
KOMERI Co. Ltd. (d)	672,100		18,306,737
Michaels Stores, Inc.	200		5,994
Nitori Co. Ltd. (d)	233,050		15,221,171
O'Reilly Automotive, Inc. (a)	100		4,505
Pacific Sunwear of California, Inc. (a)	305,000		6,789,300
Pantaloon Retail India Ltd.	100		1,689
Peacock Group PLC	1,271,844		6,638,792
PETsMART, Inc.	24,000		852,720
Pier 1 Imports, Inc.	100		1,970
RONA, Inc. (a)	100,000		3,400,000
Ross Stores, Inc.	43,900		1,267,393
Sa Sa International Holdings Ltd.	2,000		1,074
Select Comfort Corp. (a)	100		1,794
Sharper Image Corp. (a)	100		1,885
Shimamura Co. Ltd.	100		7,303
TBC Corp. New (a)	100		2,780
The Bombay Company, Inc. (a)	100		553
Tiffany & Co., Inc.	57,100		1,825,487
Tractor Supply Co. (a)	100		3,721

	Shares		Value (Note 1)
Urban Outfitters, Inc. (a)	400		$ 17,760
Williams-Sonoma, Inc. (a)	54,700		1,916,688
			106,105,955
Textiles, Apparel & Luxury Goods - 1.1%
Columbia Sportswear Co. (a)	579,600		34,549,956
Compagnie Financiere Richemont unit	100		3,322
Folli Follie SA	42,980		1,259,378
Gildan Activewear, Inc. Class A (sub. vtg.) (a)	100		3,399
K-Swiss, Inc. Class A	200		5,824
Kenneth Cole Productions, Inc. Class A (sub. vtg.)	100		3,086
NIKE, Inc. Class B	100		9,069
Polo Ralph Lauren Corp. Class A	100		4,260
Quiksilver, Inc. (a)	200		5,958
Ted Baker PLC	945,208		8,761,144
The Swatch Group AG (Bearer)	100		14,647
Timberland Co. Class A (a)	100		6,267
Weyco Group, Inc.	100		4,429
Wolverine World Wide, Inc.	100		3,142
			44,633,881
TOTAL CONSUMER DISCRETIONARY			439,229,218
CONSUMER STAPLES - 7.4%
Beverages - 0.0%
Boston Beer Co., Inc. Class A (a)	100		2,127
Companhia de Bebidas das Americas (AmBev) sponsored ADR	100		2,833
Fomento Economico Mexicano SA de CV sponsored ADR	100		5,261
Grupo Modelo SA de CV Series C	100		275
Hansen Natural Corp. (a)	100		3,641
Jones Soda Co. (a)	95,700		330,165
MGP Ingredients, Inc.	200		1,728
Pernod-Ricard	100		15,288
Tsingtao Brewery Co. Ltd. (H Shares)	1,000		1,010
			362,328
Food & Staples Retailing - 0.4%
Central European Distribution Corp. (a)	150		4,431
Massmart Holdings Ltd.	847,869		6,778,342
Plant Co. Ltd.	120,300		1,820,414
Shinsegae Co. Ltd.	1,390		382,008
Whole Foods Market, Inc.	74,600		7,113,110
			16,098,305
Food Products - 6.3%
Archer-Daniels-Midland Co.	2,678,000		59,746,180
Barry Callebaut AG	23,513		5,839,817
Bunge Ltd.	638,200		36,383,782
Corn Products International, Inc.	713,400		38,209,704
Fresh Del Monte Produce, Inc.	100		2,961
Glanbia PLC	784,887		2,981,268
Green Mountain Coffee Roasters, Inc. (a)	47,993		1,204,624
Common Stocks - continued
	Shares		Value (Note 1)
CONSUMER STAPLES - continued
Food Products - continued
Hershey Foods Corp.	504,300		$ 28,008,822
Hormel Foods Corp.	100		3,135
IAWS Group PLC (Ireland)	25,450		421,195
Lindt & Spruengli AG	400		5,844,925
Lindt & Spruengli AG (participation certificate)	2,770		3,933,354
McCormick & Co., Inc. (non-vtg.)	496,000		19,145,600
Peet's Coffee & Tea, Inc. (a)	100		2,647
People's Food Holdings Ltd.	10,068,165		9,253,261
PT Indofood Sukses Makmur Tbk	56,655,500		4,889,370
Smithfield Foods, Inc. (a)	1,230,200		36,401,618
SunOpta, Inc. (a)	39,000		279,825
Wimm-Bill-Dann Foods OJSC ADR (a)	65,400		935,874
Wm. Wrigley Jr. Co.	100		6,919
			253,494,881
Household Products - 0.1%
Central Garden & Pet Co. Class A (a)	100		4,174
Godrej Consumer Products Ltd.	178,876		1,237,657
Hindustan Lever Ltd.	104,300		345,818
Kao Corp.	1,000		25,578
Reckitt Benckiser PLC	300		9,062
			1,622,289
Personal Products - 0.6%
Alberto-Culver Co.	150		7,286
Estee Lauder Companies, Inc. Class A	63,300		2,897,241
Hengan International Group Co. Ltd.	12,932,600		8,485,521
Kose Corp.	100		4,393
Natura Cosmeticos SA	166,500		4,858,340
Shiseido Co. Ltd. ADR	459,900		6,645,555
USANA Health Sciences, Inc. (a)	200		6,840
			22,905,176
TOTAL CONSUMER STAPLES			294,482,979
ENERGY - 13.5%
Energy Equipment & Services - 9.7%
BJ Services Co.	648,610		30,186,309
Cal Dive International, Inc. (a)	467,400		19,046,550
Carbo Ceramics, Inc.	100		6,900
Compagnie Generale de Geophysique SA (a)	100		6,884
Cooper Cameron Corp. (a)	317,000		17,057,770
Core Laboratories NV (a)	230,700		5,386,845
FMC Technologies, Inc. (a)	307,500		9,901,500
Global Industries Ltd. (a)	1,530,489		12,687,754
GlobalSantaFe Corp.	692,450		22,927,020
Gulf Island Fabrication, Inc.	211,200		4,610,496
Helmerich & Payne, Inc.	195,600		6,658,224
Hydril Co. (a)	100		4,551
Input/Output, Inc. (a)	1,327,000		11,730,680
Nabors Industries Ltd. (a)	688,800		35,328,552

	Shares		Value (Note 1)
National-Oilwell, Inc. (a)	235,300		$ 8,303,737
Noble Corp. (a)	345,300		17,175,222
NS Group, Inc. (a)	100		2,780
Oceaneering International, Inc. (a)	360,086		13,438,410
Parker Drilling Co. (a)	1,996,800		7,847,424
Pason Systems, Inc.	756,300		23,319,250
Patterson-UTI Energy, Inc.	204,300		3,973,635
Pioneer Drilling Co. (a)	1,190,100		12,008,109
Precision Drilling Corp. (a)	153,300		9,647,680
Pride International, Inc. (a)	565,700		11,619,478
Rowan Companies, Inc. (a)	345,600		8,951,040
Smith International, Inc. (a)	251,090		13,661,807
Superior Energy Services, Inc. (a)	316,900		4,883,429
Transocean, Inc. (a)	524,800		22,246,272
Unit Corp. (a)	356,000		13,602,760
Varco International, Inc. (a)	1,153,848		33,634,655
Veritas DGC, Inc. (a)	100		2,241
Weatherford International Ltd. (a)	139,800		7,171,740
			387,029,704
Oil & Gas - 3.8%
Ashland, Inc.	25,900		1,512,042
Caltex Australia Ltd.	1,004,943		8,538,864
China Petroleum & Chemical Corp. sponsored ADR	100		4,099
Comstock Resources, Inc. (a)	93,100		2,052,855
Golar LNG Ltd. (a)	515,700		7,501,323
Golar LNG Ltd. (Nasdaq) (a)	21,393		318,542
JKX Oil & Gas	91		202
Niko Resources Ltd.	138,000		5,804,050
PetroChina Co. Ltd. sponsored ADR	100		5,369
PetroKazakhstan, Inc. Class A	594,600		22,064,615
Petroleo Brasileiro SA Petrobras sponsored:
ADR	100		3,978
ADR (non-vtg.)	100		3,621
Premcor, Inc.	293,300		12,368,461
Southwestern Energy Co. (a)	780,200		39,548,338
Surgutneftegaz JSC sponsored ADR	100		3,740
Talisman Energy, Inc.	194,500		5,243,396
Tesoro Petroleum Corp. (a)	465,900		14,843,574
Valero Energy Corp.	718,500		32,619,900
World Fuel Services Corp.	31,500		1,568,700
XTO Energy, Inc.	125		4,423
			154,010,092
TOTAL ENERGY			541,039,796
FINANCIALS - 8.3%
Capital Markets - 0.5%
BlackRock, Inc. Class A	100		7,726
Deutsche Bank AG (NY Shares)	13,000		1,157,130
E*TRADE Financial Corp. (a)	100		1,495
Eaton Vance Corp. (non-vtg.)	100		5,215
Common Stocks - continued
	Shares		Value (Note 1)
FINANCIALS - continued
Capital Markets - continued
Federated Investors, Inc. Class B (non-vtg.)	100		$ 3,040
International Assets Holding Corp. (a)	100		757
Investors Financial Services Corp.	49,700		2,484,006
Kotak Mahindra Bank Ltd.	439,734		2,912,920
Matsui Securities Co. Ltd.	208,800		7,277,321
Mitsubishi Securities Co. Ltd.	511,700		5,605,071
Nuveen Investments, Inc. Class A	100		3,947
T. Rowe Price Group, Inc.	200		12,440
			19,471,068
Commercial Banks - 3.4%
Banco Itau Holding Financeira SA:
(PN)	900		134,864
sponsored ADR (non-vtg.)	33,900		2,548,263
Bank Austria Creditanstalt AG	201,075		18,139,091
Bank of Baroda	1,220,572		6,874,431
Bank of Fukuoka Ltd. (d)	2,110,000		13,904,618
Bank of India	6,393,456		13,939,951
Bank of Yokohama Ltd.	2,431,000		15,331,700
BOK Financial Corp. (a)	103		5,022
Boston Private Financial Holdings, Inc.	106,100		2,988,837
Canara Bank	401,535		1,973,788
Capitalia Spa	9,229,479		42,205,762
Cathay General Bancorp	20		750
Center Financial Corp., California	20,600		412,412
Commerce Bancorp, Inc., New Jersey	68,400		4,404,960
CVB Financial Corp.	110		2,922
East West Bancorp, Inc.	200		8,392
First Horizon National Corp.	100		4,311
Fulton Financial Corp.	11		256
HDFC Bank Ltd. sponsored ADR	18,100		821,016
Hiroshima Bank Ltd.	389,000		2,058,362
ICICI Bank Ltd. sponsored ADR	5,000		100,750
Irwin Financial Corp.	100		2,839
Lakeland Financial Corp.	100		3,970
M&T Bank Corp.	100		10,784
OTP Bank Rt.	100		3,082
Popular, Inc.	200		5,766
PrivateBancorp, Inc.	200		6,446
State Bancorp, Inc., New York	5		138
State Bank of India	448,533		7,333,644
Sumitomo Trust & Banking Co. Ltd.	1,000		7,234
SunTrust Banks, Inc.	49		3,620
TCF Financial Corp.	200		6,428
Texas Regional Bancshares, Inc. Class A	150		4,902
UCBH Holdings, Inc.	100		4,582
UnionBanCal Corp.	100		6,448
Valley National Bancorp	105		2,903

	Shares		Value (Note 1)
Westcorp	100		$ 4,593
Wintrust Financial Corp.	48,000		2,734,080
			136,001,917
Consumer Finance - 0.0%
American Express Co.	100		5,637
Capital One Financial Corp.	100		8,421
First Cash Financial Services, Inc. (a)	150		4,007
STB Leasing Co. Ltd.	100		1,874
			19,939
Diversified Financial Services - 0.4%
eSpeed, Inc. Class A (a)	100		1,237
Moody's Corp.	54,100		4,698,585
Power Financial Corp.	100		2,666
Principal Financial Group, Inc.	100		4,094
TSX Group, Inc.	244,800		10,952,760
			15,659,342
Insurance - 2.7%
ACE Ltd.	100		4,275
AFLAC, Inc.	2,800		111,552
Arthur J. Gallagher & Co.	100		3,250
Assurant, Inc.	1,232,500		37,652,875
Brown & Brown, Inc.	38,000		1,654,900
Erie Indemnity Co. Class A	100		5,257
Genworth Financial, Inc. Class A	100		2,700
Hilb Rogal & Hobbs Co.	200		7,248
Horace Mann Educators Corp.	100		1,908
MBIA, Inc.	54,600		3,455,088
Mercury General Corp.	28,100		1,683,752
Ohio Casualty Corp. (a)	122,800		2,850,188
Old Republic International Corp.	150		3,795
Progressive Corp.	67,100		5,692,764
Reinsurance Group of America, Inc.	486,100		23,551,545
Scottish Re Group Ltd.	8,100		209,790
StanCorp Financial Group, Inc.	100		8,250
Triad Guaranty, Inc. (a)	100		6,048
UnumProvident Corp.	100		1,794
USI Holdings Corp. (a)	187,500		2,169,375
W.R. Berkley Corp.	618,575		29,178,183
Zenith National Insurance Corp.	300		14,952
			108,269,489
Real Estate - 1.0%
CBL & Associates Properties, Inc.	17,300		1,320,855
Corporate Office Properties Trust (SBI)	147,100		4,317,385
Equity Lifestyle Properties, Inc.	100		3,575
Equity Residential (SBI)	100		3,618
General Growth Properties, Inc.	167,100		6,042,336
Kimco Realty Corp.	226,000		13,105,740
Pan Pacific Retail Properties, Inc.	114,400		7,172,880
Plum Creek Timber Co., Inc.	141,300		5,431,572
United Dominion Realty Trust, Inc. (SBI)	29,200		724,160
Weingarten Realty Investors (SBI)	100		4,010
			38,126,131
Common Stocks - continued
	Shares		Value (Note 1)
FINANCIALS - continued
Thrifts & Mortgage Finance - 0.3%
Doral Financial Corp.	147,800		$ 7,279,150
Golden West Financial Corp., Delaware	79,940		4,909,915
MGIC Investment Corp.	100		6,891
Radian Group, Inc.	100		5,324
Sterling Financial Corp., Washington (a)	110		4,319
W Holding Co., Inc.	156		3,579
Washington Federal, Inc.	110		2,919
			12,212,097
TOTAL FINANCIALS			329,759,983
HEALTH CARE - 15.9%
Biotechnology - 6.5%
Affymetrix, Inc. (a)	190,600		6,966,430
Albany Molecular Research, Inc. (a)	100		1,114
Alnylam Pharmaceuticals, Inc.	100		738
Applera Corp. - Celera Genomics Group (a)	100		1,375
Bachem Holding AG (B Shares)	100		5,744
Celgene Corp. (a)	200		5,306
Charles River Laboratories International, Inc. (a)	1,389,204		63,917,276
Ciphergen Biosystems, Inc. (a)	100		430
CSL Ltd.	19,483		445,872
CytRx Corp. (a)	100		141
deCODE genetics, Inc. (a)	100		781
Dendreon Corp. (a)	100		1,078
Digene Corp. (a)	100		2,615
Exact Sciences Corp. (a)	100		382
Exelixis, Inc. (a)	100		950
Gen-Probe, Inc. (a)	31,900		1,442,199
Genencor International, Inc. (a)	100		1,640
Genentech, Inc. (a)	24,800		1,350,112
Global Bio-Chem Technology Group Co. Ltd.	9,232,000		6,057,431
Harvard Bioscience, Inc. (a)(e)	3,023,047		13,996,708
ImmunoGen, Inc. (a)	139,700		1,234,948
Invitrogen Corp. (a)	1,435,200		96,344,976
Lexicon Genetics, Inc. (a)	100		776
Luminex Corp. (a)	100		888
Martek Biosciences (a)	106,100		5,432,320
Myriad Genetics, Inc. (a)	100		2,251
Neogen Corp. (a)	49,663		1,124,873
Northfield Laboratories, Inc. (a)	100		2,255
ONYX Pharmaceuticals, Inc. (a)	100		3,239
QIAGEN NV (a)	4,857,800		53,192,910
Renovis, Inc.	100		1,438
Sangamo Biosciences, Inc. (a)	100		600
Seattle Genetics, Inc. (a)	100		653
Serologicals Corp. (a)	100		2,212
Sirna Therapeutics, Inc. (a)	100		316

	Shares		Value (Note 1)
Stratagene Corp. (a)	849,600		$ 6,584,400
Strategic Diagnostics, Inc. (a)	792,300		2,773,050
Tanox, Inc. (a)	100		1,520
Telik, Inc. (a)	100		1,914
			260,903,861
Health Care Equipment & Supplies - 2.3%
Advanced Medical Optics, Inc. (a)	100		4,114
Arthrocare Corp. (a)	100		3,206
Bio-Rad Laboratories, Inc. Class A (a)	100		5,737
BioLase Technology, Inc.	100		1,087
Bruker BioSciences Corp. (a)	163		657
Cardiodynamics International Corp. (a)	100		517
Chromavision Medical Systems, Inc. (a)	100		216
Cooper Companies, Inc.	100		7,059
Cyberonics, Inc. (a)	200		4,144
Cytyc Corp. (a)	100		2,757
Diagnostic Products Corp.	100		5,505
Edwards Lifesciences Corp. (a)	307,700		12,695,702
Epix Pharmaceuticals, Inc. (a)	122,400		2,192,184
IDEXX Laboratories, Inc. (a)	100		5,459
Illumina, Inc. (a)	356,400		3,378,672
INAMED Corp. (a)	150		9,488
Integra LifeSciences Holdings Corp. (a)	64,700		2,389,371
Intuitive Surgical, Inc. (a)	47,800		1,912,956
Kinetic Concepts, Inc.	20,300		1,548,890
Matthews International Corp. Class A	100		3,680
Meridian Bioscience, Inc.	135,350		2,353,737
Merit Medical Systems, Inc. (a)	133		2,037
Millipore Corp. (a)	255,900		12,746,379
Mine Safety Appliances Co.	300		15,210
Molecular Devices Corp. (a)	74,580		1,499,058
Ocular Sciences, Inc. (a)	46,300		2,269,163
Orthologic Corp. (a)	100,600		628,750
Osteotech, Inc. (a)	100		550
PolyMedica Corp.	200		7,458
Possis Medical, Inc. (a)	100		1,348
Sonic Innovations, Inc. (a)	151,300		630,921
SonoSight, Inc. (a)	100		3,395
Synovis Life Technologies, Inc. (a)	100		1,081
Synthes, Inc.	100		11,190
Thermo Electron Corp. (a)	265,200		8,006,388
Thoratec Corp. (a)	100		1,042
Varian, Inc. (a)	100		4,101
Ventana Medical Systems, Inc. (a)	19,200		1,228,608
Waters Corp. (a)	851,120		39,823,905
Wilson Greatbatch Technologies, Inc. (a)	800		17,936
Young Innovations, Inc.	100		3,373
Zimmer Holdings, Inc. (a)	100		8,012
Zoll Medical Corp. (a)	100		3,440
			93,438,483
Health Care Providers & Services - 5.6%
Advisory Board Co. (a)	100		3,688
Aetna, Inc.	216,200		26,970,950
Common Stocks - continued
	Shares		Value (Note 1)
HEALTH CARE - continued
Health Care Providers & Services - continued
AMERIGROUP Corp. (a)	100		$ 7,566
Andrx Corp. (a)	100		2,183
Caremark Rx, Inc. (a)	1,133,806		44,705,971
Centene Corp. (a)	100		2,835
Cerner Corp. (a)(d)	67,717		3,600,513
Community Health Systems, Inc. (a)	275,200		7,672,576
Covance, Inc. (a)	631,900		24,486,125
Coventry Health Care, Inc. (a)	50		2,654
Dynacq Healthcare, Inc. (a)(d)	100		480
Eclipsys Corp. (a)	100		2,043
Evotec OAI AG (a)	100		357
Gambro AB (A Shares)	100		1,426
Health Management Associates, Inc. Class A	100		2,272
HealthExtras, Inc. (a)	203,200		3,312,160
Humana, Inc. (a)	255,300		7,579,857
ICON PLC sponsored ADR (a)	335,326		12,960,350
IDX Systems Corp. (a)	100		3,446
IMS Health, Inc.	1,303,600		30,256,556
iSoft Group PLC	35		232
Lifeline Systems, Inc. (a)	155,900		4,015,984
Merge Technologies, Inc. (a)	100		2,225
Molina Healthcare, Inc. (a)	150,857		6,996,748
NDCHealth Corp.	100		1,859
OCA, Inc. (a)	100		635
Odyssey Healthcare, Inc. (a)	200		2,736
Omnicare, Inc.	138,650		4,800,063
PAREXEL International Corp. (a)	411,300		8,349,390
Pediatrix Medical Group, Inc. (a)	100		6,405
Pharmaceutical Product Development, Inc. (a)	438,700		18,113,923
ProxyMed, Inc. (a)	181,142		1,778,814
Quest Diagnostics, Inc.	200		19,110
Renal Care Group, Inc. (a)	150		5,399
ResCare, Inc. (a)	1,188,803		18,093,582
TriZetto Group, Inc. (a)	100		950
VCA Antech, Inc. (a)	80,900		1,585,640
WebMD Corp. (a)	100		816
WellPoint, Inc. (a)	200		23,000
			225,371,519
Pharmaceuticals - 1.5%
Able Laboratories, Inc. (a)	100		2,275
Allergan, Inc.	100		8,107
American Pharmaceutical Partners, Inc. (a)	150		5,612
Bentley Pharmaceuticals, Inc. (a)	9,200		98,900
Caraco Pharmaceutical Laboratories Ltd. (a)	100		955
Cipla Ltd.	50,500		371,073
Connetics Corp. (a)	416,700		10,121,643
Dr. Reddy's Laboratories Ltd. ADR	186,900		3,706,227

	Shares		Value (Note 1)
Endo Pharmaceuticals Holdings, Inc. (a)	200		$ 4,204
Hi-Tech Pharmacal Co., Inc. (a)	100		1,844
Impax Laboratories, Inc. (a)	100		1,588
KV Pharmaceutical Co. Class A (a)	150		3,308
Merck KGaA	293,321		20,141,931
Nektar Therapeutics (a)	100		2,024
Ranbaxy Laboratories Ltd. sponsored GDR	270,300		7,868,433
Roche Holding AG:
ADR (a)	10,600		1,217,728
(participation certificate)	60,543		6,917,986
Salix Pharmaceuticals Ltd. (a)	150		2,639
Schering-Plough Corp.	344,000		7,182,720
SuperGen, Inc. (a)	100		705
Warner Chilcott PLC ADR	100		6,531
			57,666,433
TOTAL HEALTH CARE			637,380,296
INDUSTRIALS - 11.2%
Aerospace & Defense - 1.3%
Ceradyne, Inc. (a)	150		8,582
Cubic Corp.	100		2,517
DRS Technologies, Inc. (a)	230,000		9,823,300
EDO Corp.	180,400		5,727,700
Embraer - Empresa Brasileira de Aeronautica SA sponsored ADR	100		3,344
General Dynamics Corp.	100		10,460
L-3 Communications Holdings, Inc.	478,800		35,067,312
Rockwell Collins, Inc.	100		3,944
			50,647,159
Air Freight & Logistics - 0.4%
Business Post Group PLC	100		1,195
C.H. Robinson Worldwide, Inc.	44,950		2,495,624
CNF, Inc.	100		5,010
Dynamex, Inc. (a)	80		1,482
Expeditors International of Washington, Inc.	33,700		1,883,156
Forward Air Corp. (a)	100		4,470
Hub Group, Inc. Class A (a)	193,420		10,100,392
			14,491,329
Airlines - 0.0%
Southwest Airlines Co.	100		1,628
Building Products - 0.2%
American Woodmark Corp.	200		8,736
Quixote Corp.	100		2,033
Simpson Manufacturing Co. Ltd.	78,800		2,750,120
Trex Co., Inc. (a)	69,800		3,660,312
Wienerberger AG	100		4,768
			6,425,969
Commercial Services & Supplies - 2.8%
Apollo Group, Inc. Class A (a)	311		25,101
Benesse Corp.	100		3,505
Common Stocks - continued
	Shares		Value (Note 1)
INDUSTRIALS - continued
Commercial Services & Supplies - continued
Bennett Environmental, Inc. (a)	167,100		$ 593,205
Bright Horizons Family Solutions, Inc. (a)	613,097		39,704,162
Bunzl PLC	101		842
Career Education Corp. (a)	100		4,000
ChoicePoint, Inc. (a)	350,500		16,119,495
Coinstar, Inc. (a)	100		2,683
Concorde Career Colleges, Inc. (a)	100		2,030
Corporate Executive Board Co.	100		6,694
CoStar Group, Inc. (a)	100		4,618
Dun & Bradstreet Corp. (a)	100		5,965
Education Management Corp. (a)	47,300		1,561,373
Fullcast Co. Ltd. (d)	5,184		14,828,781
Gevity HR, Inc.	100		2,056
GFK AG	20		777
Intertek Group PLC	100		1,353
Ionics, Inc. (a)(d)	666,900		28,903,446
ITE Group PLC	100		166
ITT Educational Services, Inc. (a)	100		4,755
Labor Ready, Inc. (a)	100		1,692
National Research Corp. (a)	100		1,615
PICO Holdings, Inc. (a)	100		2,077
Princeton Review, Inc. (a)	609,587		3,748,960
Ritchie Brothers Auctioneers, Inc.	200		6,612
Robert Half International, Inc.	100		2,943
Societe Generale de Surveillance Holding SA (SGS) (Reg.)	91		63,611
Stericycle, Inc. (a)	100		4,595
Tele Atlas NV (a)	100		1,205
Tetra Tech, Inc. (a)	74		1,239
The Brink's Co.	54,600		2,157,792
Universal Technical Institute, Inc.	85,900		3,274,508
			111,041,856
Construction & Engineering - 1.6%
Arcadis NV	9,700		180,272
Arcadis NV	6,600		121,559
Chicago Bridge & Iron Co. NV (NY Shares)	302,800		12,112,000
Dycom Industries, Inc. (a)	591,900		18,064,788
EMCOR Group, Inc. (a)	100		4,518
Fluor Corp.	301,500		16,434,765
Foster Wheeler Ltd. (a)	294,331		4,671,033
Jacobs Engineering Group, Inc. (a)	288,800		13,801,752
			65,390,687
Electrical Equipment - 0.5%
AstroPower, Inc. (a)	100		1
Baldor Electric Co.	80,900		2,227,177
BYD Co. Ltd. (H Shares)	174,500		462,472
Crompton Greaves Ltd.	144,396		995,414
Fujikura Ltd.	1,000		4,608
II-VI, Inc. (a)	100		4,249

	Shares		Value (Note 1)
Rockwell Automation, Inc.	306,900		$ 15,206,895
Roper Industries, Inc.	38,700		2,351,799
			21,252,615
Industrial Conglomerates - 0.1%
Teleflex, Inc.	77,700		4,035,738
Machinery - 3.6%
AGCO Corp. (a)	2,106,400		46,109,096
CNH Global NV	512,000		9,917,440
CUNO, Inc. (a)	117,600		6,985,440
Donaldson Co., Inc.	200		6,516
Dover Corp.	14,600		612,324
Flowserve Corp. (a)	962,700		26,512,758
Gardner Denver, Inc. (a)	64,400		2,337,076
Graco, Inc.	668,700		24,975,945
Harsco Corp.	177,200		9,877,128
Heidelberger Druckmaschinen AG (a)	124,900		4,235,827
Illinois Tool Works, Inc.	100		9,268
Koyo Seiko Co. Ltd.	1,000		14,078
Middleby Corp.	100		5,072
PACCAR, Inc.	150		12,072
Toshiba Machine Co. Ltd.	1,000		4,383
Trinity Industries, Inc.	4,900		166,992
Wabash National Corp. (a)	100		2,693
Wabtec Corp.	198,700		4,236,284
Watts Water Technologies, Inc. Class A	105,800		3,410,992
Zenon Environmental, Inc. (a)	345,300		6,747,738
			146,179,122
Marine - 0.1%
Alexander & Baldwin, Inc.	90,349		3,832,605
Road & Rail - 0.4%
Burlington Northern Santa Fe Corp.	207,700		9,826,287
Guangshen Railway Co. Ltd. sponsored ADR	100		2,047
Heartland Express, Inc.	150		3,371
Knight Transportation, Inc.	150		3,720
Landstar System, Inc. (a)	22,100		1,627,444
Norfolk Southern Corp.	124,900		4,520,131
Old Dominion Freight Lines, Inc. (a)	150		5,220
			15,988,220
Trading Companies & Distributors - 0.2%
Fastenal Co.	200		12,312
MSC Industrial Direct Co., Inc. Class A	267,300		9,617,454
Richelieu Hardware Ltd.	100		1,831
			9,631,597
Transportation Infrastructure - 0.0%
Sea Containers Ltd. Class B	7,900		153,260
TOTAL INDUSTRIALS			449,071,785
INFORMATION TECHNOLOGY - 9.1%
Communications Equipment - 0.8%
Arris Group, Inc. (a)	100		704
Common Stocks - continued
	Shares		Value (Note 1)
INFORMATION TECHNOLOGY - continued
Communications Equipment - continued
Avaya, Inc. (a)	2,900		$ 49,880
Black Box Corp.	100		4,802
Comtech Telecommunications Corp. (a)	100		3,761
NETGEAR, Inc. (a)(d)	548,100		9,969,939
Option NV (a)	90		3,229
Plantronics, Inc.	139,900		5,801,653
Polycom, Inc. (a)	200		4,664
Research In Motion Ltd. (a)	53,200		4,379,247
SafeNet, Inc. (a)	86,601		3,181,721
Tandberg ASA	681,000		8,446,555
			31,846,155
Computers & Peripherals - 0.0%
Applied Films Corp. (a)	100		2,156
Compal Electronics, Inc.	1,072		1,069
Gemplus International SA ADR (a)	100		466
iCAD, Inc. (a)	100		447
Intergraph Corp. (a)	100		2,693
M-Systems Flash Disk Pioneers Ltd. (a)	900		17,748
Moser-Baer India Ltd.	200		1,083
Network Appliance, Inc. (a)	100		3,322
Overland Storage, Inc. (a)	100		1,669
Psion PLC	100		103
Stratasys, Inc. (a)	150		5,034
Synaptics, Inc. (a)	100		3,058
			38,848
Electronic Equipment & Instruments - 3.2%
Brightpoint, Inc. (a)	150		2,931
CDW Corp.	173,492		11,511,194
CellStar Corp. (a)	100		445
Cogent, Inc.	200		6,600
Cognex Corp.	100		2,790
Dionex Corp. (a)	108,200		6,131,694
Elec & Eltek International Co. Ltd.	1,613,000		4,580,920
Excel Technology, Inc. (a)	100		2,600
Fargo Electronics, Inc. (a)	100		1,499
FLIR Systems, Inc. (a)	89,245		5,692,939
Global Imaging Systems, Inc. (a)	100		3,950
Hon Hai Precision Industries Co. Ltd.	8,750,800		40,464,536
I. D. Systems Inc. (a)	100		1,866
Iteris, Inc. (a)	100		345
Itron, Inc. (a)	100		2,391
Keyence Corp.	19,700		4,415,816
Landauer, Inc.	100		4,570
Measurement Specialties, Inc. (a)	100		2,546
Metrologic Instruments, Inc. (a)	200		4,250
Mettler-Toledo International, Inc. (a)	259,800		13,330,338
MTS Systems Corp.	100		3,381
National Instruments Corp.	100		2,725
Robotic Vision Systems, Inc. (a)	100		77

	Shares		Value (Note 1)
ScanSource, Inc. (a)	100		$ 6,216
Symbol Technologies, Inc.	2,551,600		44,142,680
Universal Display Corp. (a)	100		900
Yageo Corp. sponsored GDR (a)	100		170
			130,320,369
Internet Software & Services - 1.0%
Akamai Technologies, Inc. (a)	100		1,303
aQuantive, Inc. (a)	218,811		1,956,170
Ask Jeeves, Inc. (a)	100		2,675
Bankrate, Inc. (a)	100		1,385
Blue Coat Systems, Inc. (a)	100		1,861
Digital Impact, Inc. (a)	100		142
Digital River, Inc. (a)	101,802		4,235,981
DoubleClick, Inc. (a)	100		778
EarthLink, Inc. (a)	100		1,152
FindWhat.com (a)	100		1,773
Homestore, Inc. (a)	100		303
InfoSpace, Inc. (a)	100		4,755
iPass, Inc. (a)	100		740
iVillage, Inc. (a)	100		618
LookSmart Ltd. (a)	100		219
Neoforma, Inc. (a)	100		769
Net2Phone, Inc. (a)	100		340
Netease.com, Inc. sponsored ADR (a)	100		5,283
NIC, Inc. (a)	10		51
Open Text Corp. (a)	100		2,008
RealNetworks, Inc. (a)	1,440,109		9,533,522
Sina Corp. (a)	100		3,206
Sohu.com, Inc. (a)(d)	39,000		690,690
SonicWALL, Inc. (a)	100		632
ValueClick, Inc. (a)	100		1,333
VeriSign, Inc. (a)	686,300		23,004,776
WebEx Communications, Inc. (a)	100		2,378
Websense, Inc. (a)	27,400		1,389,728
			40,844,571
IT Services - 1.1%
Affiliated Computer Services, Inc. Class A (a)	623,900		37,552,541
Alliance Data Systems Corp. (a)	100		4,748
Anteon International Corp. (a)	100		4,186
DST Systems, Inc. (a)	600		31,272
Global Payments, Inc.	100		5,854
Hewitt Associates, Inc. Class A (a)	100		3,201
iGate Corp. (a)	100		405
Infocrossing, Inc. (a)	100		1,693
Infosys Technologies Ltd. sponsored ADR	200		13,862
infoUSA, Inc. (a)	100		1,119
Lionbridge Technologies, Inc. (a)	874,300		5,875,296
Maximus, Inc. (a)	100		3,112
Satyam Computer Services Ltd.	100		949
StarTek, Inc.	100		2,845
SunGard Data Systems, Inc. (a)	200		5,666
Syntel, Inc.	100		1,754
Common Stocks - continued
	Shares		Value (Note 1)
INFORMATION TECHNOLOGY - continued
IT Services - continued
The BISYS Group, Inc. (a)	100		$ 1,645
TietoEnator Oyj	100		3,174
Total System Services, Inc.	100		2,430
Tyler Technologies, Inc. (a)	100		836
			43,516,588
Office Electronics - 0.3%
Neopost SA	2,200		170,708
Zebra Technologies Corp. Class A (a)	218,125		12,276,075
			12,446,783
Semiconductors & Semiconductor Equipment - 1.3%
Agere Systems, Inc. Class A (a)	100		137
Analog Devices, Inc.	49,700		1,834,924
ARM Holdings PLC sponsored ADR	100		617
ASM Pacific Technology Ltd.	500		1,801
Cabot Microelectronics Corp. (a)	289,900		11,610,495
Cree, Inc. (a)	46,100		1,847,688
Hi/fn, Inc. (a)	8		74
International Rectifier Corp. (a)	15,700		699,749
KLA-Tencor Corp. (a)	31,500		1,467,270
Linear Technology Corp.	100		3,876
Marvell Technology Group Ltd. (a)	200		7,094
NVIDIA Corp. (a)	917,300		21,611,588
Omnivision Technologies, Inc. (a)	400		7,340
Pixelworks, Inc. (a)	100		1,134
PLX Technology, Inc. (a)	100		1,040
Silicon Image, Inc. (a)	100		1,646
Skyworks Solutions, Inc. (a)	389,700		3,674,871
Varian Semiconductor Equipment Associates, Inc. (a)	206,900		7,624,265
Zoran Corp. (a)	100		1,158
			50,396,767
Software - 1.4%
Adobe Systems, Inc.	75,300		4,724,322
Altiris, Inc. (a)	100		3,543
Bottomline Technologies, Inc. (a)	11		159
Cadence Design Systems, Inc. (a)	100		1,381
CCC Information Services Group, Inc. (a)	100		2,221
Citrix Systems, Inc. (a)	100		2,453
DATATRAK International, Inc. (a)	100		1,113
Digimarc Corp. (a)	100		932
Electronic Arts, Inc. (a)	100		6,168
FactSet Research Systems, Inc.	100		5,844
FileNET Corp. (a)	100		2,576
Hyperion Solutions Corp. (a)	100		4,662
Informatica Corp. (a)	100		812
Intuit, Inc. (a)	132,800		5,844,528
JAMDAT Mobile, Inc.	100		2,065
Macromedia, Inc. (a)	100		3,112
Macrovision Corp. (a)	389,944		10,029,360
Manhattan Associates, Inc. (a)	100		2,388

	Shares		Value (Note 1)
MRO Software, Inc. (a)	100		$ 1,302
Napster, Inc. (a)	100		940
NAVTEQ Corp.	100		4,636
NDS Group PLC sponsored ADR (a)	100		3,408
Open Solutions, Inc. (a)	437,209		11,349,946
Plato Learning, Inc. (a)	100		745
Quality Systems, Inc. (a)	100		5,980
Renaissance Learning, Inc.	70		1,299
RSA Security, Inc. (a)	100,687		2,019,781
Salesforce.com, Inc.	60,000		1,016,400
ScanSoft, Inc. (a)	100		419
SERENA Software, Inc. (a)	100		2,164
Symantec Corp. (a)	100		2,576
Synopsys, Inc. (a)	325,800		6,392,196
TALX Corp.	83,200		2,145,728
Temenos Group AG (a)	100		922
THQ, Inc. (a)	313,900		7,200,866
TIBCO Software, Inc. (a)	100		1,334
Vastera, Inc. (a)	667,400		1,755,262
Visual Networks, Inc. (a)	767,308		2,670,232
WatchGuard Technologies, Inc. (a)	10		44
			55,213,819
TOTAL INFORMATION TECHNOLOGY			364,623,900
MATERIALS - 18.4%
Chemicals - 1.9%
American Vanguard Corp.	150		5,517
Asian Paints India Ltd.	45,800		338,920
Balchem Corp.	100		3,469
Cambrex Corp.	100		2,710
Ecolab, Inc. (d)	509,300		17,891,709
Headwaters, Inc. (a)	100		2,850
K&S AG	59,500		3,155,946
Lonza Group AG	10		562
Minerals Technologies, Inc.	34,200		2,281,140
Monsanto Co.	178,300		9,904,565
Mosaic Co. (a)	117,900		1,924,128
Nitto Denko Corp.	181,200		9,941,853
NOVA Chemicals Corp.	251,500		11,883,375
Novozymes AS Series B	100		5,071
Olin Corp.	104,900		2,309,898
Potash Corp. of Saskatchewan	100		8,313
Praxair, Inc.	47,000		2,075,050
Quaker Chemical Corp.	100		2,484
Sasa Dupont Sabanci Polyester Sanayi AS (a)	1,000		1
Sinopec Beijing Yanhua Petrochemical Co. Ltd. sponsored ADR	100		2,337
Sinopec Shanghai Petrochemical Co. Ltd.:
(H Shares)	2,000		746
Common Stocks - continued
	Shares		Value (Note 1)
MATERIALS - continued
Chemicals - continued
Sinopec Shanghai Petrochemical Co. Ltd.: - continued
sponsored ADR (d)	125,400		$ 4,677,420
Tosoh Corp.	1,859,500		8,368,930
			74,786,994
Construction Materials - 0.0%
Cemex SA de CV sponsored ADR	104		3,788
Florida Rock Industries, Inc.	150		8,930
Vulcan Materials Co.	13,000		709,930
			722,648
Containers & Packaging - 0.4%
Essel Propack Ltd.	13,700		84,069
Packaging Corp. of America	565,300		13,312,815
Silgan Holdings, Inc.	40,500		2,468,880
			15,865,764
Metals & Mining - 15.8%
Agnico-Eagle Mines Ltd.	1,180,230		16,247,833
Agnico-Eagle Mines Ltd. warrants 11/14/07 (a)	23,350		64,446
Aleris International, Inc. (a)	100		1,692
Arch Coal, Inc.	365,400		12,986,316
Barrick Gold Corp.	100		2,417
BHP Billiton Ltd. sponsored ADR	15,500		372,310
BlueScope Steel Ltd.	1,037,200		6,694,919
Brush Engineered Materials, Inc. (a)	100		1,850
Compania de Minas Buenaventura SA sponsored ADR	1,105,300		25,311,370
CONSOL Energy, Inc.	763,900		31,358,095
Dofasco, Inc.	100		3,783
Falconbridge Ltd.	225,900		5,854,575
FNX Mining Co., Inc. (a)	164,300		709,228
Freeport-McMoRan Copper & Gold, Inc. Class B	1,273,800		48,697,374
Gibraltar Industries, Inc.	106,400		2,513,168
Glamis Gold Ltd. (a)	129,400		2,217,053
Goldcorp, Inc.	50,000		752,500
Golden Star Resources Ltd. (a)	250,000		1,004,167
Harmony Gold Mining Co. Ltd.	1,049,100		9,725,158
High River Gold Mines Ltd. (a)	1,989,600		3,034,140
Inco Ltd. (a)	100		3,667
Inmet Mining Corp. (a)	712,800		12,794,760
International Steel Group, Inc.	2,500		101,400
IPSCO, Inc.	1,165,900		55,681,441
Ivanhoe Mines Ltd. (a)	90,500		652,354
Kinross Gold Corp. (a)	4,204,866		29,609,265
Massey Energy Co.	289,794		10,128,300
Meridian Gold, Inc. (a)	100		1,895
Newmont Mining Corp.	2,267,580		100,703,207
Nippon Steel Corp.	3,401,000		8,333,994

	Shares		Value (Note 1)
Noranda, Inc.	100		$ 1,755
Nucor Corp. (d)	1,866,700		97,703,078
Peabody Energy Corp.	233,400		18,884,394
Phelps Dodge Corp.	89,200		8,823,664
Placer Dome, Inc.	100		1,882
POSCO sponsored ADR	100		4,453
Ryerson Tull, Inc.	100		1,575
Schnitzer Steel Industries, Inc. Class A	150		5,090
Steel Dynamics, Inc.	1,728,994		65,494,293
Teck Cominco Ltd. Class B (sub. vtg.) (d)	1,118,800		34,421,747
United States Steel Corp.	354,300		18,157,875
Usinas Siderurgicas de Minas Gerais SA (Usiminas) (PN-A)	203,000		4,115,030
Worthington Industries, Inc.	3,200		62,656
Xstrata PLC	100		1,789
			633,241,958
Paper & Forest Products - 0.3%
International Forest Products (Interfor) Class A (a)	9,100		52,325
Lee & Man Paper Manufacturing Ltd.	6,792,000		5,548,734
MAXXAM, Inc. (a)	100		3,260
Sino-Forest Corp. (a)	2,545,700		7,276,459
Votorantim Celulose e Papel SA sponsored ADR (non-vtg.)	250		4,050
			12,884,828
TOTAL MATERIALS			737,502,192
TELECOMMUNICATION SERVICES - 1.9%
Diversified Telecommunication Services - 0.8%
Covad Communications Group, Inc. (a)	2,491,761		5,357,286
General Communications, Inc. Class A (a)	100		1,104
Golden Telecom, Inc.	100		2,642
Hungarian Telephone & Cable Corp. (a)	100		1,440
Philippine Long Distance Telephone Co. (a)	100		2,421
Philippine Long Distance Telephone Co. sponsored ADR (a)(d)	425,600		10,610,208
PT Indosat Tbk sponsored ADR	100		3,118
PT Telkomunikasi Indonesia Tbk sponsored ADR	722,300		15,182,746
			31,160,965
Wireless Telecommunication Services - 1.1%
America Movil SA de CV sponsored ADR	224,300		11,742,105
Boston Communications Group, Inc. (a)	100		924
MTN Group Ltd.	2,253,716		17,305,369
Nextel Communications, Inc. Class A (a)	100		3,000
Nextel Partners, Inc. Class A (a)	100		1,954
NII Holdings, Inc. (a)	349,008		16,560,430
Telemig Celular Participacoes SA ADR	100		2,823
			45,616,605
TOTAL TELECOMMUNICATION SERVICES			76,777,570
Common Stocks - continued
	Shares		Value (Note 1)
UTILITIES - 0.0%
Electric Utilities - 0.0%
FPL Group, Inc.	100		$ 7,475
PPL Corp.	100		5,328
			12,803
Multi-Utilities & Unregulated Power - 0.0%
Public Service Enterprise Group, Inc.	100		5,177
TOTAL UTILITIES			17,980
TOTAL COMMON STOCKS (Cost $2,720,027,228)		3,869,885,699
Nonconvertible Preferred Stocks - 0.0%

CONSUMER DISCRETIONARY - 0.0%
Automobiles - 0.0%
Porsche AG (non-vtg.)	100		63,690
Household Durables - 0.0%
Fedders Corp. Series A, 8.60%	5		120
TOTAL NONCONVERTIBLE PREFERRED STOCKS (Cost $58,459)		63,810
Money Market Funds - 4.0%

Fidelity Cash Central Fund, 2.24% (b)	99,587,186		99,587,186
Fidelity Securities Lending Cash Central Fund, 2.23% (b)(c)	59,013,966		59,013,966
TOTAL MONEY MARKET FUNDS (Cost $158,601,152)		158,601,152
TOTAL INVESTMENT PORTFOLIO - 100.7% (Cost $2,878,686,839)			4,028,550,661
NET OTHER ASSETS - (0.7)%			(28,308,362)
NET ASSETS - 100%			$ 4,000,242,299

Legend

(a) Non-income producing

(d) Security or a portion of the security is on loan at period end.

(e) Affiliated company

Other Information

Distribution of investments by country of issue, as a percentage of total net assets, is as follows:

United States of America	72.7%
Canada	7.1%
Japan	3.9%
Netherlands	1.9%
India	1.5%
Bermuda	1.2%
Cayman Islands	1.1%
Italy	1.1%
Taiwan	1.0%
Others (individually less than 1%)	8.5%
	100.0%

An affiliated company is a company in which the fund has ownership of at least 5% of the voting securities. Companies which are affiliates of the fund at period-end are noted in the fund's Schedule of Investments. Transactions during the period with companies which are or were affiliates are as follows:

Affiliates	Value, beginning of period	Purchases	Sales Proceeds	Dividend Income	Value, end of period
Bright Horizons Family Solutions, Inc.	$ 28,782,600	$ -	$ 4,594,980	$ -	$ -
Foster Wheeler Ltd.	-	3,915,209	-	-	-
Harvard Bioscience, Inc.	24,939,580	1,612,609	1,104,712	-	13,996,708
IMPCO Technologies, Inc.	1,771,032	8,777,717	791,283	-	11,373,320
Total	$ 55,493,212	$ 14,305,535	$ 6,490,975	$ -	$ 25,370,028

Income Tax Information

The fund hereby designates as capital gain dividends: For dividends with respect to the taxable year ended December 31, 2004, $68,763,000 or, if different, the net capital gain of such year.

See accompanying notes which are an integral part of the financial statements.

Mid Cap Portfolio

Fidelity Variable Insurance Products Fund: Mid Cap Portfolio

Financial Statements

Statement of Assets and Liabilities

	December 31, 2004

Assets
Investment in securities, at value (including securities loaned of $57,253,994) (cost $2,878,686,839) - See accompanying schedule		$ 4,028,550,661
Cash		118,202
Foreign currency held at value (cost $9,142,039)		9,609,981
Receivable for investments sold		41,707,554
Receivable for fund shares sold		2,072,663
Dividends receivable		2,016,209
Interest receivable		213,204
Prepaid expenses		11,603
Other receivables		214,767
Total assets		4,084,514,844

Liabilities
Payable for investments purchased	$ 19,788,804
Payable for fund shares redeemed	1,032,969
Accrued management fee	1,840,389
Distribution fees payable	506,394
Other affiliated payables	310,760
Other payables and accrued expenses	1,779,263
Collateral on securities loaned, at value	59,013,966
Total liabilities		84,272,545

Net Assets		$ 4,000,242,299
Net Assets consist of:
Paid in capital		$ 2,787,744,560
Undistributed net investment income		68,191
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions		63,335,377
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies		1,149,094,171
Net Assets		$ 4,000,242,299

Initial Class: Net Asset Value, offering price and redemption price per share ($979,532,916 ÷ 32,457,007 shares)		$ 30.18

Service Class: Net Asset Value, offering price and redemption price per share ($819,411,575 ÷ 27,246,677 shares)		$ 30.07

Service Class 2: Net Asset Value, offering price and redemption price per share ($2,201,297,808 ÷ 73,675,095 shares)		$ 29.88

Statement of Operations

	Year ended December 31, 2004

Investment Income
Dividends		$ 19,986,604
Interest		811,862
Security lending		749,362
Total income		21,547,828

Expenses
Management fee	$ 17,263,105
Transfer agent fees	2,044,982
Distribution fees	4,605,289
Accounting and security lending fees	941,481
Non-interested trustees' compensation	15,949
Custodian fees and expenses	426,013
Audit	52,412
Legal	6,596
Interest	709
Miscellaneous	576,544
Total expenses before reductions	25,933,080
Expense reductions	(742,557)	25,190,523
Net investment income (loss)		(3,642,695)
Realized and Unrealized Gain (Loss) Net realized gain (loss) on:
Investment securities (Including realized gain of $2,737,245 from affiliated issuers)	195,588,243
Foreign currency transactions	(153,730)
Total net realized gain (loss)		195,434,513
Change in net unrealized appreciation (depreciation) on: Investment securities (net of increase in deferred foreign taxes of $918,145)	535,771,834
Assets and liabilities in foreign currencies	481,551
Total change in net unrealized appreciation (depreciation)		536,253,385
Net gain (loss)		731,687,898
Net increase (decrease) in net assets resulting from operations		$ 728,045,203

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products Fund: Mid Cap Portfolio
Financial Statements - continued

Statement of Changes in Net Assets

	Year ended December 31, 2004	Year ended December 31, 2003^A
Increase (Decrease) in Net Assets
Operations
Net investment income (loss)	$ (3,642,695)	$ (2,294,177)
Net realized gain (loss)	195,434,513	29,542,718
Change in net unrealized appreciation (depreciation)	536,253,385	575,223,419
Net increase (decrease) in net assets resulting from operations	728,045,203	602,471,960
Distributions to shareholders from net investment income	-	(5,082,393)
Share transactions - net increase (decrease)	835,964,194	440,089,337
Total increase (decrease) in net assets	1,564,009,397	1,037,478,904

Net Assets
Beginning of period	2,436,232,902	1,398,753,998
End of period (including undistributed net investment income of $68,191 and undistributed net investment income of $76,412, respectively)	$ 4,000,242,299	$ 2,436,232,902

Other Information:
Share Transactions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2
Shares Sold	7,712,308	4,751,291	29,867,543
Reinvested	-	-	-
Redeemed	(3,341,075)	(1,581,671)	(5,307,215)
Net increase (decrease)	4,371,233	3,169,620	24,560,328

Dollars Sold	$ 203,215,754	$ 122,478,823	$ 766,867,153
Reinvested	-	-	-
Redeemed	(83,674,683)	(40,224,756)	(132,698,097)
Net increase (decrease)	$ 119,541,071	$ 82,254,067	$ 634,169,056

Share Transactions	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2
Shares Sold	4,434,612	4,691,539	24,537,608
Reinvested	131,528	76,717	95,288
Redeemed	(5,011,471)	(2,353,097)	(5,472,778)
Net increase (decrease)	(445,331)	2,415,159	19,160,118

Dollars Sold	$ 95,795,053	$ 94,175,028	$ 482,784,357
Reinvested	2,207,036	1,285,007	1,590,350
Redeemed	(89,867,137)	(43,168,976)	(104,711,381)
Net increase (decrease)	$ 8,134,952	$ 52,291,059	$ 379,663,326

Distributions	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2
From net investment income	$ 2,207,036	$ 1,285,007	$ 1,590,350

^A Certain amounts have been reclassified. See Note 1 of Notes to Financial Statements.

See accompanying notes which are an integral part of the financial statements.

Mid Cap Portfolio

Financial Highlights - Initial Class

Years ended December 31,	2004	2003^F	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 24.16	$ 17.51	$ 19.60	$ 20.26	$ 15.25
Income from Investment Operations
Net investment income (loss)^C	.01	-^E	.09	.20	.19
Net realized and unrealized gain (loss)	6.01	6.73	(2.00)	(.86)	4.95
Total from investment operations	6.02	6.73	(1.91)	(.66)	5.14
Distributions from net investment income	-	(.08)	(.18)	-	(.08)
Distributions in excess of net realized gain	-	-	-	-	(.05)
Total distributions	-	(.08)	(.18)	-	(.13)
Net asset value, end of period	$ 30.18	$ 24.16	$ 17.51	$ 19.60	$ 20.26
Total Return^{A, B}	24.92%	38.64%	(9.82)%	(3.26)%	33.78%
Ratios to Average Net Assets^D
Expenses before expense reductions	.71%	.70%	.70%	.69%	.74%
Expenses net of voluntary waivers, if any	.71%	.70%	.70%	.69%	.74%
Expenses net of all reductions	.68%	.68%	.63%	.62%	.69%
Net investment income (loss)	.03%	-%	.51%	1.06%	1.01%
Supplemental Data
Net assets, end of period (000 omitted)	$ 979,533	$ 678,480	$ 499,557	$ 574,934	$ 589,026
Portfolio turnover rate	55%	51%	135%	144%	245%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^E Amount represents less than $.01 per share.

^F As the result of a correction made in the classification of distributions received on securities representing realized gains for the year ended December 31, 2003, amounts previously reported have been reclassified. The impact of this correction was a decrease in net investment loss of $0.01 per share and a corresponding decrease in net realized and unrealized gain (loss). The ratio of net investment loss to average net assets decreased from (0.04)% to 0.00%. The reclassification had no impact on total net assets or total return of the class.

Financial Highlights - Service Class

Years ended December 31,	2004	2003^E	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 24.10	$ 17.46	$ 19.54	$ 20.22	$ 15.24
Income from Investment Operations
Net investment income (loss)^C	(.02)	(.02)	.08	.18	.17
Net realized and unrealized gain (loss)	5.99	6.72	(2.00)	(.86)	4.93
Total from investment operations	5.97	6.70	(1.92)	(.68)	5.10
Distributions from net investment income	-	(.06)	(.16)	-	(.07)
Distributions in excess of net realized gain	-	-	-	-	(.05)
Total distributions	-	(.06)	(.16)	-	(.12)
Net asset value, end of period	$ 30.07	$ 24.10	$ 17.46	$ 19.54	$ 20.22
Total Return^{A, B}	24.77%	38.52%	(9.90)%	(3.36)%	33.54%
Ratios to Average Net Assets^D
Expenses before expense reductions	.81%	.80%	.80%	.79%	.84%
Expenses net of voluntary waivers, if any	.81%	.80%	.80%	.79%	.84%
Expenses net of all reductions	.78%	.78%	.73%	.72%	.79%
Net investment income (loss)	(.07)%	(.10)%	.41%	.96%	.92%
Supplemental Data
Net assets, end of period (000 omitted)	$ 819,412	$ 580,179	$ 378,264	$ 366,665	$ 282,941
Portfolio turnover rate	55%	51%	135%	144%	245%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^E As the result of a correction made in the classification of distributions received on securities representing realized gains for the year ended December 31, 2003, amounts previously reported have been reclassified. The impact of this correction was a decrease in net investment loss of $0.01 per share and a corresponding decrease in net realized and unrealized gain (loss). The ratio of net investment loss to average net assets decreased from (0.14)% to (0.10)%. The reclassification had no impact on total net assets or total return of the class.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products Fund: Mid Cap Portfolio
Financial Statements - continued

Financial Highlights - Service Class 2

Years ended December 31,	2004	2003^F	2002	2001	2000^D
Selected Per-Share Data
Net asset value, beginning of period	$ 23.98	$ 17.39	$ 19.49	$ 20.20	$ 14.82
Income from Investment Operations
Net investment income (loss)^C	(.06)	(.05)	.05	.15	.14
Net realized and unrealized gain (loss)	5.96	6.69	(1.99)	(.86)	5.35
Total from investment operations	5.90	6.64	(1.94)	(.71)	5.49
Distributions from net investment income	-	(.05)	(.16)	-	(.06)
Distributions in excess of net realized gain	-	-	-	-	(.05)
Total distributions	-	(.05)	(.16)	-	(.11)
Net asset value, end of period	$ 29.88	$ 23.98	$ 17.39	$ 19.49	$ 20.20
Total Return^{A, B}	24.60%	38.31%	(10.02)%	(3.51)%	37.12%
Ratios to Average Net Assets^E
Expenses before expense reductions	.96%	.95%	.95%	.94%	.99%^A
Expenses net of voluntary waivers, if any	.96%	.95%	.95%	.94%	.99%^A
Expenses net of all reductions	.93%	.93%	.88%	.88%	.94%^A
Net investment income (loss)	(.22)%	(.25)%	.25%	.81%	.76%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 2,201,298	$ 1,177,574	$ 520,933	$ 210,356	$ 73,039
Portfolio turnover rate	55%	51%	135%	144%	245%

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Calculated based on average shares outstanding during the period.

^D For the period January 12, 2000 (commencement of operations) to December 31, 2000.

^E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of any voluntary waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.

^F As the result of a correction made in the classification of distributions received on securities representing realized gains for the year ended December 31, 2003, amounts previously reported have been reclassified. The impact of this correction was a decrease in net investment loss of $0.01 per share and a corresponding decrease in net realized and unrealized gain (loss). The ratio of net investment loss to average net assets decreased from (0.29)% to (0.25)%. The reclassification had no impact on total net assets or total return of the class.

See accompanying notes which are an integral part of the financial statements.

Mid Cap Portfolio

Fidelity Variable Insurance Products: Money Market Portfolio

Performance: The Bottom Line

Average Annual Total Returns

Periods ended December 31, 2004	Past 1 year	Past 5 years	Past 10 years
Fidelity VIP: Money Market - Initial Class	1.21%	2.86%	4.16%
Fidelity VIP: Money Market - Service Class^A	1.10%	2.77%	4.12%
Fidelity VIP: Money Market - Service Class 2^B	0.95%	2.62%	4.04%

^A The initial offering of Service Class shares took place on July 7, 2000. Performance for Service Class shares reflects an asset-based service fee (12b-1 fee), and returns prior to July 7, 2000 are those of Initial Class and do not include the effects of a 12b-1 fee. Had Service Class' 12b-1 fee been reflected, returns prior to July 7, 2000 would have been lower.

^B The initial offering of Service Class 2 shares took place on January 12, 2000. Performance for Service Class 2 shares reflects an asset-based service fee (12b-1 fee), and returns prior to January 12, 2000 are those of Initial Class and do not include the effects of a 12b-1 fee. Had Service Class 2's 12b-1 fee been reflected, returns prior to January 12, 2000 would have been lower.

Yield

	12/28/04	9/28/04	6/29/04	3/30/04	12/30/03
Fidelity VIP Money Market - Initial Class	1.91%	1.47%	1.03%	0.92%	0.99%

Yield refers to the income paid by the fund over a given period. Yields for money market funds are usually for seven-day periods, expressed as annual percentage rates. A yield that assumes income earned is reinvested or compounded is called an effective yield. The chart above shows the fund's current seven-day yield at quarterly intervals over the past year.

Annual Report

Fidelity Variable Insurance Products: Money Market Portfolio

Investment Summary

Maturity Diversification
Days	% of fund's investments 12/31/04
0 - 30	34.6
31 - 90	44.8
91 - 180	19.2
181 - 397	1.4
Weighted Average Maturity
	12/31/04
Fidelity Variable Insurance Products: Money Market Portfolio	56 Days

Asset Allocation (% of fund's net assets)
As of December 31, 2004
	Corporate Bond	1.6%
	Commercial Paper	17.5%
	Bank CDs, BAs, TDs, and Notes	53.0%
	Government Securities	19.6%
	Repurchase Agreements	8.9%
	Net Other Assets*	(0.6)%

* Net Other Assets are not included in the pie chart.

Money Market Portfolio

Fidelity Variable Insurance Products: Money Market Portfolio

Investments December 31, 2004

Showing Percentage of Net Assets

Corporate Bonds - 1.6%
Due Date	Annualized Yield at Time of Purchase	Principal Amount		Value (Note 1)
Bell Trace Obligated Group
1/7/05	2.50% (b)	$ 11,600,000		$ 11,600,000
Citigroup, Inc.
12/1/05	2.95	9,735,000		10,056,742
Deutsche Telekom International Finance BV
6/15/05	2.68	1,050,000		1,075,500
6/15/05	2.70	140,000		143,383
6/15/05	2.71	205,000		209,949
6/15/05	2.83	35,000		35,843
6/15/05	2.84	110,000		112,645
6/15/05	2.85	95,000		97,276
6/15/05	2.88	55,000		56,311
TOTAL CORPORATE BONDS			23,387,649
Certificates of Deposit - 20.0%

Domestic Certificates Of Deposit - 1.2%
Washington Mutual Bank, California
1/27/05	1.90	7,000,000		7,000,050
6/13/05	2.70	10,000,000		10,000,000
				17,000,050
London Branch, Eurodollar, Foreign Banks - 7.7%
Barclays Bank PLC
2/28/05	1.93	25,000,000		25,000,000
Calyon
2/22/05	1.87	15,000,000		15,000,000
Dresdner Bank AG
2/1/05	2.02	15,000,000		15,000,000
ING Bank NV
1/4/05	1.98	15,000,000		15,000,000
Societe Generale
3/7/05	2.00	20,000,000		20,000,000
4/21/05	2.55	20,000,000		20,000,000
				110,000,000
New York Branch, Yankee Dollar, Foreign Banks - 11.1%
Bank of Tokyo-Mitsubishi Ltd.
1/31/05	2.41	15,000,000		15,000,000
BNP Paribas SA
1/24/05	2.33 (b)	10,000,000		9,997,629
2/14/05	1.95	15,000,000		15,000,000
Canadian Imperial Bank of Commerce
1/18/05	2.45 (b)	20,000,000		20,000,000
1/28/05	2.36 (b)	25,000,000		24,998,443
HBOS Treasury Services PLC
3/4/05	2.39 (b)	20,000,000		20,000,000

Due Date	Annualized Yield at Time of Purchase	Principal Amount		Value (Note 1)
Landesbank Baden-Wuerttemberg
2/25/05	2.31% (b)	$ 15,000,000		$ 14,998,225
3/7/05	2.37 (b)	5,000,000		4,999,730
Societe Generale
1/10/05	2.28 (b)	5,000,000		4,999,726
1/18/05	2.34 (b)	15,000,000		14,997,516
Societe Generale NA
5/9/05	2.53	4,000,000		3,984,336
Unicredito Italiano Spa
2/14/05	2.21 (b)	10,000,000		9,997,969
				158,973,574
TOTAL CERTIFICATES OF DEPOSIT			285,973,624
Commercial Paper - 17.2%

Bank of America Corp.
3/16/05	2.06	20,000,000		19,916,133
4/5/05	2.16	15,000,000		14,916,183
Bradford & Bingley PLC
1/28/05	2.12	5,000,000		4,992,106
Charta LLC
2/10/05	2.25	5,000,000		4,987,556
Comcast Corp.
1/3/05	2.59	1,000,000		999,856
1/18/05	2.67	3,000,000		2,996,232
DaimlerChrysler NA Holding Corp.
1/24/05	2.56	2,000,000		1,996,729
1/25/05	2.58	5,000,000		4,991,433
Dominion Resources, Inc.
1/12/05	2.44	700,000		699,478
Dorada Finance, Inc.
3/10/05	2.04 (a)	5,000,000		4,980,922
3/14/05	2.03 (a)	15,000,000		14,939,700
Dresdner U.S. Finance, Inc.
1/24/05	1.98	5,000,000		4,993,715
Ford Motor Credit Co.
1/6/05	2.63	4,000,000		3,998,539
1/13/05	2.51	10,000,000		9,991,667
General Electric Capital Corp.
2/1/05	1.90	15,000,000		14,975,717
2/11/05	1.87	10,000,000		9,978,931
Grampian Funding Ltd.
2/10/05	1.97	10,000,000		9,978,333
4/8/05	2.45	5,000,000		4,967,263
4/19/05	2.20	10,000,000		9,934,600
6/20/05	2.72	5,000,000		4,936,722
John Deere Capital Corp.
1/14/05	2.43	1,000,000		999,123
Commercial Paper - continued
Due Date	Annualized Yield at Time of Purchase	Principal Amount		Value (Note 1)
Jupiter Securitization Corp.
6/20/05	2.70%	$ 10,629,000		$ 10,495,488
Kellogg Co.
1/10/05	2.42	500,000		499,698
Motown Notes Program
1/18/05	2.22	5,000,000		4,994,782
2/1/05	2.16	5,000,000		4,990,743
2/7/05	2.27	19,000,000		18,955,867
Nordea North America, Inc.
5/23/05	2.53	15,000,000		14,852,083
Paradigm Funding LLC
1/7/05	2.30 (b)	5,000,000		4,999,925
2/24/05	1.94	15,000,000		14,956,800
Park Granada LLC
2/8/05	2.25	10,000,000		9,976,356
Westpac Capital Corp.
3/2/05	2.31	10,250,000		10,210,879
TOTAL COMMERCIAL PAPER			246,103,559
Federal Agencies - 19.6%

Fannie Mae - 7.3%
Agency Coupons - 7.3%
2/15/05	1.40	5,000,000		5,000,000
2/25/05	1.40	25,000,000		25,000,000
3/29/05	1.40	15,000,000		15,000,000
5/4/05	1.54	20,000,000		20,000,000
5/13/05	1.59	20,000,000		20,000,000
5/16/05	1.63	5,000,000		5,000,000
6/3/05	1.84	5,000,000		5,000,000
9/12/05	2.31	10,000,000		10,000,000
				105,000,000
Federal Home Loan Bank - 12.3%
Agency Coupons - 12.3%
2/25/05	1.40	15,000,000		15,000,000
2/25/05	1.82	5,000,000		4,996,906
3/11/05	1.44	35,000,000		35,000,000
4/1/05	1.40	55,000,000		54,999,999
4/1/05	1.45	10,240,000		10,238,768
4/27/05	1.30	10,000,000		10,000,000
4/27/05	1.74	5,000,000		4,993,134
4/28/05	1.35	5,000,000		5,000,000
4/29/05	2.03	5,000,000		4,989,167
5/2/05	1.92	5,000,000		4,991,020
5/3/05	1.37	20,000,000		20,000,000
5/16/05	1.65	5,000,000		5,000,000
				175,208,994
TOTAL FEDERAL AGENCIES			280,208,994
Master Notes - 4.4%
Due Date	Annualized Yield at Time of Purchase	Principal Amount		Value (Note 1)
General Motors Acceptance Corp. Mortgage Credit
1/3/05	2.88% (e)	$ 10,000,000		$ 9,998,404
1/3/05	2.92 (e)	4,000,000		3,999,353
Goldman Sachs Group, Inc.
1/10/05	2.06 (b)(e)	7,000,000		7,000,000
2/28/05	2.43 (b)(e)	36,000,000		36,000,000
4/12/05	2.12 (e)	5,000,000		5,000,000
TOTAL MASTER NOTES			61,997,757
Medium-Term Notes - 21.2%

American Express Credit Corp.
1/5/05	2.38 (b)	10,000,000		10,000,822
Bank of New York Co., Inc.
1/27/05	2.44 (a)(b)	15,000,000		15,000,000
Bank of Scotland Treasury Services PLC
3/14/05	2.53 (a)(b)	10,000,000		10,001,272
Bayerische Landesbank Girozentrale
2/19/05	2.30 (b)	15,000,000		15,000,000
BellSouth Telecommunications
3/4/05	2.50 (b)	5,000,000		5,000,000
Citigroup Global Markets Holdings, Inc.
3/7/05	2.50 (b)	5,000,000		5,002,442
Countrywide Home Loans, Inc.
1/18/05	2.14 (b)	10,000,000		9,998,834
Descartes Funding Trust
1/18/05	2.40 (b)	5,000,000		5,000,000
General Electric Capital Corp.
1/10/05	2.46 (b)	25,000,000		25,000,000
1/17/05	2.51 (b)	20,000,000		20,000,000
HBOS Treasury Services PLC
3/24/05	2.55 (b)	20,000,000		20,000,000
Morgan Stanley
1/3/05	2.37 (b)	2,000,000		2,000,000
1/4/05	2.33 (b)	5,000,000		5,000,000
1/18/05	2.40 (b)	5,000,000		5,000,000
1/18/05	2.52 (b)	25,000,000		25,004,623
1/27/05	2.43 (b)	11,000,000		11,000,385
National City Bank
3/1/05	2.32 (b)	10,000,000		9,998,759
RACERS
1/24/05	2.41 (a)(b)	15,000,000		15,000,000
SBC Communications, Inc.
6/5/05	2.39 (a)	4,000,000		4,028,398
SouthTrust Bank, Alabama
2/2/05	2.23 (b)	25,000,000		25,008,583
Medium-Term Notes - continued
Due Date	Annualized Yield at Time of Purchase	Principal Amount		Value (Note 1)
Verizon Global Funding Corp.
3/15/05	2.60% (b)	$ 50,000,000		$ 50,000,242
Westpac Banking Corp.
3/14/05	2.39 (b)	10,000,000		9,998,640
TOTAL MEDIUM-TERM NOTES			302,043,000
Short-Term Notes - 5.8%

Jackson National Life Insurance Co.
1/3/05	2.15 (b)(e)	7,000,000		7,000,000
Metropolitan Life Insurance Co.
1/3/05	2.20 (b)(e)	10,000,000		10,000,000
1/28/05	2.46 (a)(b)	5,000,000		5,000,000
2/1/05	2.32 (b)(e)	5,000,000		5,000,000
Monumental Life Insurance Co.
1/1/05	2.42 (b)(e)	5,000,000		5,000,000
1/1/05	2.45 (b)(e)	5,000,000		5,000,000
New York Life Insurance Co.
1/3/05	2.14 (b)(e)	30,000,000		30,000,000
Pacific Life Insurance Co.
3/11/05	2.62 (b)(e)	5,000,000		5,000,000
Transamerica Occidental Life Insurance Co.
2/1/05	2.33 (b)(e)	10,000,000		10,000,000
TOTAL SHORT-TERM NOTES			82,000,000
Municipal Securities - 1.9%


New York State Hsg. Fin. Svc. Contract Rev. Series 2003 H, 2.45%, LOC Dexia Cr. Local de France, VRDN (b)		11,000,000		11,000,000
San Jose Redev. Agcy. Rev. Series A, 2.45%, LOC JPMorgan Chase Bank, VRDN (b)(c)		11,250,000		11,250,000
West Baton Rouge Parish Indl. District #3 Rev. Bonds (Dow Chemical Co. Proj.) Series 1995, 2.4% tender 1/5/05, CP mode		5,200,000		5,200,000
TOTAL MUNICIPAL SECURITIES			27,450,000
Repurchase Agreements - 8.9%
	Maturity Amount		Value (Note 1)
In a joint trading account (Collateralized by U.S. Government Obligations dated 12/31/04 due 1/3/05 At 2.32%)	$ 98,019		$ 98,000
With:
Banc of America Securities LLC At 2.37%, dated 12/31/04 due 1/3/05 (Collateralized by Commercial Paper Obligations with principal amounts of $15,320,717, 2.44%, 1/19/05)	15,002,963		15,000,000
Goldman Sachs & Co. At:
2.41%, dated 12/31/04 due 1/3/05 (Collateralized by Mortgage Loan Obligations with principal amounts of $2,003,978, 4.88%, 1/12/38)	2,000,402		2,000,000
2.43%, dated 11/22/04 due 2/18/05 (Collateralized by Mortgage Loan Obligations with principal amounts of $25,084,688, 5.25% - 7.14%, 12/15/12 - 2/25/44) (b)(d)	20,118,800		20,000,000
J.P. Morgan Securities, Inc. At 2.38%, dated 12/15/04 due 2/3/05 (Collateralized by Corporate Obligations with principal amounts of $25,120,000, 6.05% - 7.38%, 6/20/08 - 2/15/24)	24,079,333		24,000,000
Lehman Brothers, Inc. At 2.43%, dated 12/31/04 due 1/3/05 (Collateralized by Equity Securities valued at $24,639,109)	23,004,658		23,000,000
Repurchase Agreements - continued
	Maturity Amount		Value (Note 1)
With: - continued
Merrill Lynch, Pierce, Fenner & Smith At 2.46%, dated 11/8/04 due 2/1/05 (Collateralized by Corporate Obligations with principal amounts of $24,810,000, 6.85%, 5/1/29) (b)(d)	$ 23,133,592		$ 23,000,000
Morgan Stanley & Co. At 2.38%, dated 12/15/04 due 2/3/05 (Collateralized by Mortgage Loan Obligations with principal amounts of $26,590,879, 3.9% - 6.13%, 8/25/32 - 8/25/34)	20,066,111		20,000,000
TOTAL REPURCHASE AGREEMENTS		127,098,000
TOTAL INVESTMENT PORTFOLIO - 100.6%			1,436,262,583
NET OTHER ASSETS - (0.6)%			(9,009,474)
NET ASSETS - 100%			$ 1,427,253,109
Total Cost for Federal Income Tax Purposes			$ 1,436,262,583

Security Type Abbreviations
CP	-	Commercial Paper
VRDN	-	Variable Rate Demand Note

Legend

(b) The coupon rate shown on floating or adjustable rate securities represents the rate at period end. The due dates on these types of securities reflect the next interest rate reset date or, when applicable, the final maturity date.

(d) The maturity amount is based on the rate at period end.

(e) Restricted securities - Investment in securities not registered under the Securities Act of 1933 (excluding 144A issues). At the end of the period, the value of restricted securities (excluding 144A issues) amounted to $138,997,758 or 9.7% of net assets.

Additional information on each holding is as follows:

Security	Acquisition Date	Cost
General Motors Acceptance Corp. Mortgage Credit: 2.88%, 1/3/05	12/1/04	$ 9,998,404
2.92%, 1/3/05	12/1/04	$ 3,999,353
Goldman Sachs Group, Inc.: 2.06%, 1/10/05	7/8/04	$ 7,000,000
2.12%, 4/12/05	9/14/04	$ 5,000,000
2.43%, 2/28/05	8/26/04	$ 36,000,000
Jackson National Life Insurance Co. 2.15%, 1/3/05	3/31/03	$ 7,000,000
Metropolitan Life Insurance Co.: 2.2%, 1/3/05	3/26/02	$ 10,000,000
2.32%, 2/1/05	2/24/03	$ 5,000,000
Monumental Life Insurance Co.: 2.42%, 1/1/05	9/17/98	$ 5,000,000
2.45, 1/1/05	3/12/99	$ 5,000,000
New York Life Insurance Co. 2.14%, 1/3/05	2/28/02 - 12/19/02	$ 30,000,000
Pacific Life Insurance Co 2.62%, 3/11/05	3/10/03	$ 5,000,000
Transamerica Occidental Life Insurance Co. 2.33%, 2/1/05	4/28/00	$ 10,000,000

Income Tax Information

At December 31, 2004, the fund had a capital loss carryforward of approximately $284,000 of which $109,000 and $175,000 will expire on December 31, 2011 and 2012, respectively.

See accompanying notes which are an integral part of the financial statements.

Money Market Portfolio

Fidelity Variable Insurance Products: Money Market Portfolio

Financial Statements

Statement of Assets and Liabilities

	December 31, 2004
Assets
Investment in securities, at value (including repurchase agreements of $127,098,000) (cost $1,436,262,583) - See accompanying schedule		$ 1,436,262,583
Cash		181,340
Receivable for fund shares sold		1,447,892
Interest receivable		3,372,555
Prepaid expenses		6,391
Other affiliated receivables		740
Other receivables		10
Total assets		1,441,271,511

Liabilities
Payable for investments purchased	$ 10,118,802
Payable for fund shares redeemed	3,382,769
Accrued management fee	234,506
Distribution fees payable	4,914
Other affiliated payables	97,414
Other payables and accrued expenses	179,997
Total liabilities		14,018,402

Net Assets		$ 1,427,253,109
Net Assets consist of:
Paid in capital		$ 1,427,486,892
Undistributed net investment income		49,905
Accumulated undistributed net realized gain (loss) on investments		(283,688)
Net Assets		$ 1,427,253,109

Initial Class: Net Asset Value, offering price and redemption price per share ($1,392,448,817 ÷ 1,392,654,760 shares)		$ 1.00

Service Class: Net Asset Value, offering price and redemption price per share ($13,905,448 ÷ 13,906,161 shares)		$ 1.00

Service Class 2: Net Asset Value, offering price and redemption price per share ($20,898,844 ÷ 20,900,582 shares)		$ 1.00

Statement of Operations

	Year ended December 31, 2004
Investment Income
Interest		$ 24,719,517

Expenses
Management fee	$ 3,278,063
Transfer agent fees	1,109,423
Distribution fees	43,872
Accounting fees and expenses	180,343
Non-interested trustees' compensation	9,503
Custodian fees and expenses	36,714
Audit	37,379
Legal	3,797
Miscellaneous	246,179
Total expenses before reductions	4,945,273
Expense reductions	(504)	4,944,769
Net investment income		19,774,748
Net realized gain (loss) on investment securities		(174,987)
Net increase in net assets resulting from operations		$ 19,599,761

See accompanying notes which are an integral part of the financial statements.

Annual Report

Fidelity Variable Insurance Products: Money Market Portfolio
Financial Statements - continued

Statement of Changes in Net Assets

	Year ended December 31, 2004	Year ended December 31, 2003
Increase (Decrease) in Net Assets
Operations
Net investment income	$ 19,774,748	$ 23,975,974
Net realized gain (loss)	(174,987)	(133,557)
Net increase in net assets resulting from operations	19,599,761	23,842,417
Distributions to shareholders from net investment income	(19,778,361)	(23,975,974)
Share transactions - net increase (decrease)	(412,681,844)	(920,442,277)
Total increase (decrease) in net assets	(412,860,444)	(920,575,834)

Net Assets
Beginning of period	1,840,113,553	2,760,689,387
End of period (including undistributed net investment income of $49,905 and $0, respectively)	$ 1,427,253,109	$ 1,840,113,553

Other Information:
Share Transactions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2
Shares Sold	830,419,484	47,818,461	22,301,596
Reinvested	19,434,528	224,941	96,802
Redeemed	(1,274,668,391)	(53,743,207)	(4,566,058)
Net increase (decrease)	(424,814,379)	(5,699,805)	17,832,340

Share Transactions	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2
Shares Sold	6,056,411,700	54,027,987	82,930,007
Reinvested	23,602,029	128,154	208,645
Redeemed	(6,967,511,919)	(42,565,009)	(127,673,871)
Net increase (decrease)	(887,498,190)	11,591,132	(44,535,219)

Distributions	Year ended December 31, 2004
	Initial Class	Service Class	Service Class 2
From net investment income	$ 19,434,556	$ 247,002	$ 96,803
	Year ended December 31, 2003
	Initial Class	Service Class	Service Class 2
From net investment income	$ 23,625,076	$ 137,269	$ 213,629

See accompanying notes which are an integral part of the financial statements.

Money Market Portfolio

Financial Highlights - Initial Class

Years ended December 31,	2004	2003	2002	2001	2000
Selected Per-Share Data
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from Investment Operations
Net investment income	.012	.010	.017	.041	.062
Distributions from net investment income	(.012)	(.010)	(.017)	(.041)	(.062)
Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total Return^{A, B}	1.21%	1.00%	1.69%	4.18%	6.30%
Ratios to Average Net Assets^C
Expenses before expense reductions	.29%	.29%	.29%	.28%	.33%
Expenses net of voluntary waivers, if any	.29%	.29%	.29%	.28%	.33%
Expenses net of all reductions	.29%	.29%	.29%	.28%	.33%
Net investment income	1.18%	1.00%	1.68%	3.99%	6.18%
Supplemental Data
Net assets, end of period (000 omitted)	$ 1,392,449	$ 1,817,440	$ 2,705,069	$ 2,753,379	$ 2,233,342

^A Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^B Total returns would have been lower had certain expenses not been reduced during the periods shown.

^C Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of any voluntary waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.

Financial Highlights - Service Class

Years ended December 31,	2004	2003	2002	2001	2000^E
Selected Per-Share Data
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from Investment Operations
Net investment income	.011	.009	.016	.040	.031
Distributions from net investment income	(.011)	(.009)	(.016)	(.040)	(.031)
Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total Return^{B, C, D}	1.10%	.90%	1.61%	4.10%	3.06%
Ratios to Average Net Assets^F
Expenses before expense reductions	.40%	.38%	.39%	.39%	.47%^A
Expenses net of voluntary waivers, if any	.40%	.38%	.39%	.39%	.45%^A
Expenses net of all reductions	.40%	.38%	.39%	.39%	.45%^A
Net investment income	1.08%	.91%	1.58%	3.87%	6.28%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 13,905	$ 19,606	$ 8,017	$ 6,143	$ 103

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E For the period July 7, 2000 (commencement of sale of shares) to December 31, 2000.

^F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of any voluntary waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Service Class 2

Years ended December 31,	2004	2003	2002	2001	2000^E
Selected Per-Share Data
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from Investment Operations
Net investment income	.009	.007	.014	.039	.058
Distributions from net investment income	(.009)	(.007)	(.014)	(.039)	(.058)
Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total Return^{B, C, D}	.95%	.75%	1.45%	3.96%	5.89%
Ratios to Average Net Assets^F
Expenses before expense reductions	.55%	.54%	.54%	.55%	.96%^A
Expenses net of voluntary waivers, if any	.55%	.54%	.54%	.55%	.60%^A
Expenses net of all reductions	.55%	.54%	.54%	.55%	.60%^A
Net investment income	.93%	.75%	1.43%	3.71%	5.94%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 20,899	$ 3,068	$ 47,604	$ 40,267	$ 108

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns do not reflect charges attributable to your insurance company's separate account. Inclusion of these charges would reduce the total returns shown.

^D Total returns would have been lower had certain expenses not been reduced during the periods shown.

^E For the period January 12, 2000 (commencement of sale of shares) to December 31, 2000.

See accompanying notes which are an integral part of the financial statements.

Money Market Portfolio

Notes to Financial Statements

For the period ended December 31, 2004

1. Significant Accounting Policies.

Money Market Portfolio (the fund) is a fund of Variable Insurance Products Fund. Asset Manager: Growth Portfolio and Investment Grade Bond Portfolio (the funds) are funds of Variable Insurance Products Fund II. Balanced Portfolio, Growth & Income Portfolio, Growth Opportunities Portfolio, and Mid Cap Portfolio (the funds) are funds of Variable Insurance Products Fund III. The Variable Insurance Products Fund, Variable Insurance Products Fund II, and Variable Insurance Products Fund III (the trusts) (referred to in this report as Fidelity Variable Insurance Products) are registered under the Investment Company Act of 1940, as amended (the 1940 Act), as open-end management investment companies organized as Massachusetts business trusts. Certain funds may invest in affiliated fixed income and money market central funds (underlying funds) managed by affiliates of Fidelity Management & Research Company (FMR). Each fund is authorized to issue an unlimited number of shares. Shares of each fund may only be purchased by insurance companies for the purpose of funding variable annuity or variable life insurance contracts. Each fund offers three classes of shares: Initial Class shares, Service Class shares and Service Class 2 shares. All classes have equal rights and voting privileges, except for matters affecting a single class. Investment income, realized and unrealized capital gains and losses, the common expenses of the fund, and certain fund-level expense reductions, if any, are allocated on a pro rata basis to each class based on the relative net assets of each class to the total net assets of the fund. Each class differs with respect to distribution and service plan fees incurred. Certain expense reductions also differ by class.

The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which require management to make certain estimates and assumptions at the date of the financial statements. The following summarizes the significant accounting policies of the funds and underlying funds (funds):

As permitted under Rule 2a-7 of the 1940 Act, and certain conditions therein, securities are valued initially at cost and thereafter assume a constant amortization to maturity of any discount or premium.

Investment Transactions and Income. Security transactions, including purchases and sales of the underlying funds, are accounted for as of trade date. Gains and losses on securities sold are determined on the basis of identified cost and may include proceeds received from litigation. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the funds are informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Distributions received on securities that represent a return of capital or capital gain are recorded as a reduction of cost of investments and/or as a realized gain. The funds estimate the components of distributions received that may be considered return of capital distributions or capital gain distributions for income tax purposes. Large, non-recurring dividends recognized by the funds are presented separately on the Statement of Operations as "Special Dividends" and the impact of these dividends to net investment income per share is presented in the Financial Highlights. Interest income is accrued as earned. Interest income includes coupon interest and amortization of premium and accretion of discount on debt securities. Inflation-indexed bonds are fixed-income securities whose principal value is periodically adjusted according to the rate of inflation. Interest is accrued based on the principal value which is adjusted for inflation. Any increase in the principal amount of an inflation-indexed bond is recorded as interest income, even though the principal is not received until maturity. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.

Annual Report

Notes to Financial Statements - continued

1. Significant Accounting Policies - continued

Reclassification of Financial Information. As the result of a correction made for Mid Cap Portfolio in the classification of distributions received on securities representing realized gains for the year ended December 31, 2003, amounts previously reported have been reclassified. Net investment loss for the fund decreased by $669,090, with a corresponding decrease to net realized gain. The reclassification has no impact on total net assets or total return of the fund.

Expenses. Most expenses of each trust can be directly attributed to a fund. Expenses which cannot be directly attributed are apportioned among each fund in the trust.

For Money Market Portfolio and Investment Grade Bond Portfolio, dividends are declared daily and paid monthly from net investment income and distributions from realized gains, if any, are recorded on the ex-dividend date. Distribution from net investment income and realized gains are recorded on the ex-dividend date for all other funds. Income dividends and capital gain distributions are declared separately for each class. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from generally accepted accounting principles.

Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. There were no significant book-to-tax differences during the period for the Money Market Portfolio. Temporary book-tax differences will reverse in a subsequent period.

Book-tax differences are primarily due to futures transactions, swap agreements, foreign currency transactions, passive foreign investment companies (PFIC), prior period premium and discount on debt securities, defaulted bonds, market discount, partnerships, non-taxable dividends, net operating losses, financing transactions, capital loss carryforwards and losses deferred due to wash sales.

The tax-basis components of distributable earnings and the federal tax cost as of period end were as follows for each fund:

	Cost for Federal Income Tax Purposes	Unrealized Appreciation	Unrealized Depreciation	Net Unrealized Appreciation/ (Depreciation)
Asset Manager: Growth	$ 290,518,932	$ 41,086,675	$ (12,210,961)	$ 28,875,714
Balanced	330,350,599	41,868,386	(6,030,299)	35,838,087
Growth & Income	1,454,054,880	251,148,239	(54,167,320)	196,980,919
Growth Opportunities	580,239,414	165,058,633	(9,887,045)	155,171,588
Investment Grade Bond	1,847,686,450	30,842,152	(5,060,033)	25,782,119
Mid Cap	2,884,816,139	1,164,223,599	(20,489,077)	1,143,734,522

	Undistributed Ordinary Income	Undistributed Long-term Capital Gain	Capital Loss Carryforward
Asset Manager: Growth	$ 7,055,920	$ -	$ (68,821,848)
Balanced	8,901,487	-	(11,446,067)
Growth & Income	22,456,038	-	(160,503,421)
Growth Opportunities	6,118,258	-	(265,681,565)
Investment Grade Bond	68,789,164	24,161,221	-
Mid Cap	-	68,763,219	-

Annual Report

1. Significant Accounting Policies - continued

Income Tax Information and Distributions to Shareholders - continued

The tax character of distributions paid was as follows:

December 31, 2004
	Ordinary Income	Long-term Capital Gains	Total
Asset Manager: Growth	$ 7,897,225	$ -	$ 7,897,225
Balanced	6,988,389	-	6,988,389
Growth & Income	12,447,351	-	12,447,351
Growth Opportunities	3,865,122	-	3,865,122
Investment Grade Bond	97,273,775	17,608,424	114,882,199
December 31, 2003
	Ordinary Income	Long-term Capital Gains	Total
Asset Manager: Growth	$ 8,995,679	$ -	$ 8,995,679
Balanced	7,974,845	-	7,974,845
Growth & Income	12,772,749	-	12,772,749
Growth Opportunities	4,842,328	-	4,842,328
Investment Grade Bond	101,912,282	9,272,230	111,184,512
Mid Cap	5,082,393	-	5,082,393

2. Operating Policies.

Repurchase Agreements. FMR has received an Exemptive Order from the Securities and Exchange Commission (the SEC) which permits the funds and other affiliated entities of FMR to transfer uninvested cash balances into joint trading accounts. These accounts are then invested in repurchase agreements that are collateralized by U.S. Treasury or Government obligations. Certain funds may also invest directly with institutions, in repurchase agreements that are collateralized by commercial paper obligations, corporate obligations and mortgage loan obligations which may be below investment-grade quality, and equity securities. Collateral is held in segregated accounts with custodian banks and may be obtained in the event of a default of the counterparty. Collateral is marked-to-market daily and maintained at a value at least equal to the principal amount of the repurchase agreement (including accrued interest).

Delayed Delivery Transactions and When-Issued Securities. Each fund may purchase or sell securities on a delayed delivery or when-issued basis. Payment and delivery may take place after the customary settlement period for that security. The price of the underlying securities and the date when the securities will be delivered and paid for are fixed at the time the transaction is negotiated. During the time a delayed delivery sell is outstanding, the contract is marked-to-market daily and equivalent deliverable securities are held for the transaction. The value of the securities purchased on a delayed delivery or when-issued basis are identified as such in each applicable fund's Schedule of Investments. Each fund may receive compensation for interest forgone in the purchase of a delayed delivery or when-issued security. With respect to purchase commitments, each fund identifies securities as segregated in its records with a value at least equal to the amount of the commitment. The payables and receivables associated with the purchases and sales of delayed delivery securities having the same coupon, settlement date and broker are offset. Delayed delivery or when-issued securities that have been purchased from and sold to different brokers are reflected as both payables and receivables in each applicable funds' Statements of Assets and Liabilities under the caption "Delayed delivery." Losses may arise due to changes in the value of the underlying securities or if the counterparty does not perform under the contract's terms, or if the issuer does not issue the securities due to political, economic, or other factors.

Annual Report

Notes to Financial Statements - continued

2. Operating Policies - continued

Swap Agreements. Certain funds may invest in swaps for the purpose of managing their exposure to interest rate, credit or market risk.

Total return swaps are agreements to exchange the return generated by one instrument for the return generated by another instrument, for example, the agreement to pay interest in exchange for a market-linked return based on a notional amount. To the extent the total return of the index exceeds the offsetting interest obligation, each applicable fund will receive a payment from the counterparty. To the extent it is less, each applicable fund will make a payment to the counterparty. Periodic payments received or made by each applicable fund are recorded in the accompanying Statement of Operations as realized gains or losses, respectively.

Swaps are marked-to-market daily based on dealer-supplied valuations and changes in value are recorded as unrealized appreciation (depreciation). Gains or losses are realized upon early termination of the swap agreement. Collateral, in the form of cash or securities, may be required to be held in segregated accounts with each applicable fund's custodian in compliance with swap contracts. Risks may exceed amounts recognized on the Statement of Assets and Liabilities. These risks include changes in the returns of the underlying instruments, failure of the counterparties to perform under the contracts' terms and the possible lack of liquidity with respect to the swap agreements. Details of swap agreements open at period end are included in each applicable fund's Schedule of Investments under the caption "Swap Agreements."

3. Purchases and Sales of Investments.

Purchases and sales of securities, other than short-term securities and U.S. government securities, and in-kind transactions are noted in the table below.

	Purchases ($)	Sales ($)
Asset Manager: Growth	137,932,727	172,380,243
Balanced	65,426,083	83,095,686
Growth & Income	420,135,989	322,208,324
Growth Opportunities	462,835,321	533,581,152
Investment Grade Bond	221,392,385	326,031,847
Mid Cap	2,400,817,321	1,622,172,637

Annual Report

4. Fees and Other Transactions with Affiliates.

Management Fee. FMR and its affiliates provide the funds with investment management related services for which the funds pay a monthly management fee.

For all funds except the Money Market Portfolio, the management fee is the sum of an individual fund fee rate applied to the average net assets of each fund and a group fee rate. The group fee rates differ for equity and fixed-income funds and are each based upon the average net assets of all the mutual funds advised by FMR. The group fee rates decrease as assets under management increase and increase as assets under management decrease. The annual individual fund fee rate is .30% of the fund's average net assets for Asset Manager: Growth, Growth Opportunities, Investment Grade Bond, and Mid Cap Portfolios, .20% for Growth & Income Portfolio, and .15% for Balanced Portfolio. The group fee rates averaged .28% for the equity funds and .13% for the fixed-income funds during the period.

For the Money Market Portfolio, the management fee is calculated on the basis of a group fee rate plus a total income-based component. The group fee rate averaged .13% during the period. The total income-based component is calculated according to a graduated schedule providing for different rates based on the fund's gross annualized yield. The rate increases as the fund's gross yield increases. During the period the income-based portion of the management fee was $1,173,053 or an annual rate of.07% of the fund's average net assets.

For the period, each fund's total annual management fee rate, expressed as a percentage of each fund's average net assets, was as follows:

Asset Manager: Growth	.58%
Balanced	.42%
Growth & Income	.47%
Growth Opportunities	.58%
Investment Grade Bond	.43%
Mid Cap	.57%
Money Market	.20%

Distribution and Service Plan. In accordance with Rule 12b-1 of the 1940 Act, the funds have adopted separate 12b-1 Plans for each Service Class of shares. Each Service Class pays Fidelity Distributors Corporation (FDC), an affiliate of FMR, a service fee. For the period, the service fee is based on an annual rate of .10% of Service Class' average net assets and .25% of Service Class 2's average net assets.

For the period, each class paid FDC the following amounts, all of which were re-allowed to insurance companies for the distribution of shares and providing shareholder support services:

	Service Class	Service Class 2	Total
Asset Manager: Growth	$ 6,290	$ 16,930	$ 23,220
Balanced	21,241	82,529	103,770
Growth & Income	377,024	1,085,899	1,462,923
Growth Opportunities	215,230	146,444	361,674
Investment Grade Bond	36,362	365,989	402,351
Mid Cap	665,057	3,940,232	4,605,289
Money Market	22,272	21,600	43,872

Asset Manager: Growth
Initial Class	$ 217,846
Service Class	6,137
Service Class 2	8,819
	$ 232,802
Balanced
Initial Class	$ 198,193
Service Class	15,788
Service Class 2	24,958
	$ 238,939

Annual Report

Notes to Financial Statements - continued

4. Fees and Other Transactions with Affiliates - continued

Transfer Agent Fees - continued

Growth & Income
Initial Class	$ 489,424
Service Class	252,242
Service Class 2	297,002
	$ 1,038,668
Growth Opportunities
Initial Class	$ 312,303
Service Class	147,098
Service Class 2	47,905
	$ 507,306
Investment Grade Bond
Initial Class	$ 952,891
Service Class	25,231
Service Class 2	104,884
	$ 1,083,006
Mid Cap
Initial Class	$ 517,432
Service Class	449,572
Service Class 2	1,077,978
	$ 2,044,982
Money Market
Initial Class	$ 1,087,334
Service Class	15,939
Service Class 2	6,150
	$ 1,109,423

Central Funds. The funds may invest in affiliated Central Funds managed by Fidelity Investments Money Management, Inc. (FIMM) or Fidelity Management and Research Co., Inc. (FMRC), affiliates of FMR. The Central Funds are open-end investment companies available only to investment companies and other accounts managed by FMR and its affiliates. The Money Market central funds seek preservation of capital and current income. The Floating Rate Central Investment Portfolio seeks a high level of current income. The High Income Central Investment Portfolio 1 seeks a high level of income and may also seek capital appreciation. The central funds do not pay a management fee. Income distributions earned by the funds are recorded as income in the accompanying financial statements. Distributions from the Central Funds are noted in the table below:

	Income Distributions
Asset Manager: Growth	$ 765,242
Balanced	664,370
Growth & Income	2,003,509
Growth Opportunities	367,174
Investment Grade Bond	3,767,633
Mid Cap	803,656

Market value of securities delivered on an in-kind basis, in a non-taxable exchange, for 227,807 shares of the Fidelity High Income Central Investment Portfolio 1 aggregated $22,780,664 during the period for Asset Manager: Growth Portfolio.

	Amount
Asset Manager: Growth	$ 2,773
Balanced	4,134
Growth & Income	28,868
Growth Opportunities	24,963
Mid Cap	171,170

Annual Report

4. Fees and Other Transactions with Affiliates - continued

Interfund Lending Program. Pursuant to an Exemptive Order issued by the SEC, the funds, along with other registered investment companies having management contracts with FMR, may participate in an interfund lending program. This program provides an alternative credit facility allowing the funds to borrow from, or lend money to, other participating funds. Each applicable fund's activity in this program during the period was as follows:

	Borrower or Lender	Average Daily Loan Balance	Weighted Average Interest Rate	Interest Earned (included in interest income)	Interest Expense
Mid Cap	Borrower	$ 11,369,500	1.12%	-	$ 709
Money Market	Lender	8,038,737	1.25%	$ 5,311	-

5. Committed Line of Credit.

Certain funds participate with other funds managed by FMR in a $4.2 billion credit facility (the "line of credit") to be utilized for temporary or emergency purposes to fund shareholder redemptions or for other short-term liquidity purposes. The participating funds have agreed to pay commitment fees on their pro rata portion of the line of credit. During the period, there were no borrowings on this line of credit.

6. Security Lending.

7. Expense Reductions.

	Brokerage Service Arrangement	Custody expense reduction
Asset Manager: Growth	$ 37,214	$ 863
Balanced	13,097	367
Growth & Income	105,306	-
Growth Opportunities	139,311	180
Investment Grade Bond	-	3,322
Mid Cap	739,274	3,283
Money Market	-	504

8. Other Information.

At the end of the period, FMR or its affiliates and certain otherwise unaffiliated shareholders each were owners of record of more than 10% of the outstanding shares of the following funds:

Fund	Affiliated %	Number of Unaffiliated Shareholders	Unaffiliated Shareholders %
Asset Manager: Growth	69%	-	-
Balanced	62%	1	22%
Growth & Income	20%	1	48%
Growth Opportunities	22%	1	44%
Investment Grade Bond	45%	1	13%
Mid Cap	19%	2	42%
Money Market	62%	1	14%

Annual Report

Report of Independent Registered Public Accounting Firm

To the Trustees of Variable Insurance Products Fund III and the Shareholders of Mid Cap Portfolio:

In our opinion, the accompanying statement of assets and liabilities, including the schedule of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of Mid Cap Portfolio (a fund of Variable Insurance Products Fund III) at December 31, 2004 and the results of its operations, the changes in its net assets and the financial highlights for the periods indicated, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Mid Cap Portfolio's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at December 31, 2004 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP

PricewaterhouseCoopers LLP

Boston, Massachusetts

February 10, 2005

Annual Report

Report of Independent Registered Public Accounting Firm

To the Trustees of Variable Insurance Products Fund and the Shareholders of Money Market Portfolio:

In our opinion, the accompanying statement of assets and liabilities, including the schedule of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of Money Market Portfolio (a fund of Variable Insurance Products Fund) at December 31, 2004 and the results of its operations, the changes in its net assets and the financial highlights for the periods indicated, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Money Market Portfolio's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at December 31, 2004 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP

PricewaterhouseCoopers LLP

Boston, Massachusetts

February 14, 2005

Annual Report

Report of Independent Registered Public Accounting Firm

To the Trustees of Variable Insurance Products Fund III and Shareholders of Growth Opportunities Portfolio:

We have audited the accompanying statements of assets and liabilities of Growth Opportunities Portfolio (the Fund), fund of Variable Insurance Products III, including the portfolios of investments, as of December 31, 2004, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial positions of Growth Opportunities Portfolio as of December 31, 2004, the results of their operations for the year then ended, the changes in their net assets for each of the two years in the period then ended, and their financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.

/s/DELOITTE & TOUCHE LLP

DELOITTE & TOUCHE LLP

Boston, Massachusetts

February 14, 2005

Annual Report

Report of Independent Registered Public Accounting Firm

To the Trustees of Variable Insurance Products Fund II and Variable Insurance Products Fund III and Shareholders of Asset Manager: Growth Portfolio, Investment Grade Bond Portfolio, Balanced Portfolio and Growth & Income Portfolio:

We have audited the accompanying statements of assets and liabilities of Asset Manager: Growth Portfolio, Investment Grade Bond Portfolio, Balanced Portfolio and Growth & Income Portfolio (the Funds), funds of Variable Insurance Products III, including the portfolios of investments, as of December 31, 2004, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the periods presented. These financial statements and financial highlights are the responsibility of the Funds' management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial positions of Asset Manager: Growth Portfolio, Investment Grade Bond Portfolio, Balanced Portfolio and Growth & Income Portfolio as of December 31, 2004, the results of their operations for the year then ended, the changes in their net assets for each of the two years in the period then ended, and their financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America.

/s/DELOITTE & TOUCHE LLP

DELOITTE & TOUCHE LLP

Boston, Massachusetts

February 18, 2005

Annual Report

Fidelity Floating Rate Central Investment Portfolio

December 31, 2004 (Unaudited)

Top Fifty Holdings (excluding cash equivalents)*

	Principal Amount	Value	% of Fund's Net Assets
General Growth Properties, Inc. Tranche B, term loan 4.53% 11/12/08	$ 6,000,000	$ 6,015,000	4.8
Lake Las Vegas LLC Tranche 1, term loan 5.1197% 11/1/09	4,310,000	4,342,325	3.5
Qwest Corp. Tranche A, term loan 7.39% 6/30/07	4,000,000	4,170,000	3.3
UPC Distribution Holdings BV Tranche F, term loan 5.98% 12/31/11	4,000,000	4,050,000	3.2
Dex Media West LLC/Dex Media West Finance Co. Tranche B, term loan 4.1033% 9/9/10	3,993,293	4,043,209	3.2
El Paso Corp. Credit-Linked Deposit 5.15% 11/22/09	4,000,000	4,030,000	3.2
Marina District Finance Co., Inc. term loan 3.93% 10/14/11	4,000,000	4,030,000	3.2
R.H. Donnelley Corp. Tranche B2, term loan 4.3086% 6/30/11	3,965,788	4,005,446	3.2
PacifiCare Health Systems, Inc. Tranche B, term loan 4.1618% 12/6/10	4,000,000	4,000,000	3.2
Nexstar Broadcasting, Inc. Tranche D, term loan 4.31% 12/31/10	3,989,975	3,999,975	3.2
Starwood Hotels & Resorts Worldwide, Inc. term loan 3.67% 10/9/06	3,666,667	3,666,667	2.9
Smurfit-Stone Container Enterprises, Inc. Tranche B, term loan 4.5208% 11/1/11	3,489,621	3,537,603	2.8
Vicar Operating, Inc. Tranche F, term loan 4.1875% 9/30/08	3,100,000	3,119,375	2.5
RailAmerica, Inc. term loan 4.375% 9/29/11	3,000,000	3,052,500	2.4
Constellation Brands, Inc. Tranche B, term loan 4.5866% 12/22/11	3,000,000	3,037,500	2.4
Texas Genco LLC term loan 4.48% 12/14/11	3,000,000	3,033,750	2.4
Lamar Media Corp. Tranche C, term loan 4.0625% 6/30/10	3,000,000	3,030,000	2.4
ON Semiconductor Corp. Tranche G, term loan 5.5625% 12/15/11	3,000,000	3,007,500	2.4
HCA, Inc. term loan 3.42% 11/9/09	3,000,000	2,992,500	2.4
Charter Communication Operating LLC Tranche A, term loan 5.13% 4/27/10	3,000,000	2,981,250	2.4
Century Cable Holdings LLC Tranche B, term loan 7.25% 6/30/09	3,000,000	2,977,500	2.4
Kansas City Southern Railway Co. Tranche B1, term loan 4.0939% 3/30/08	2,800,000	2,842,000	2.3
Iron Mountain, Inc. Tranche R, term loan 4.1875% 4/2/11	2,500,000	2,512,500	2.0
NRG Energy, Inc. term loan 4.95% 12/24/11	2,193,750	2,193,750	1.8
Valor Telecommunications Enterprises LLC Tranche 2, term loan 10.0815% 11/10/11	2,000,000	2,060,000	1.6
AM General LLC Tranche B1, term loan 6.759% 11/1/11	2,000,000	2,040,000	1.6
Simmons Bedding Co. Tranche C, term loan 4.0535% 12/19/11	2,000,000	2,030,000	1.6
Herbalife International, Inc. term loan 4.58% 12/21/10	2,000,000	2,027,500	1.6
Reliant Energy, Inc. term loan 4.795% 4/30/10	2,000,000	2,025,000	1.6
Advertising Directory Solutions, Inc. Tranche 1, term loan 4.4% 11/9/11	2,000,000	2,015,000	1.6
LNR Property Corp. Tranche B, term loan 5.59% 1/31/08	2,000,000	2,010,000	1.6
Community Health Systems, Inc. term loan 4.15% 8/19/11	1,995,000	2,004,975	1.6
Nextel Communications, Inc. Tranche E, term loan 4.6875% 12/15/10	1,994,962	1,996,209	1.6
NRG Energy, Inc. Credit-Linked Deposit 4.325% 12/24/11	1,706,250	1,708,383	1.4
Domino's, Inc. term loan 4.3125% 6/25/10	1,632,486	1,650,852	1.3
Goodman Global Holdings, Inc. term loan 4.8125% 12/23/11	1,220,000	1,226,100	1.0
Smurfit-Stone Container Enterprises, Inc. Tranche C, term loan 4.3958% 11/1/11	1,073,729	1,088,493	0.9
Georgia-Pacific Corp. term loan 3.4647% 7/2/09	1,000,000	998,750	0.8
Cooper Standard Auto, Inc. Tranche C, term loan 6.25% 12/23/11	616,667	624,375	0.5
Landry's Seafood Restaurants, Inc. term loan 4.5276% 12/28/10	465,000	469,650	0.4
Smurfit-Stone Container Enterprises, Inc. Credit-Linked Deposit 2.4% 11/1/10	436,650	442,654	0.4
Cooper Standard Auto, Inc. Tranche B, term loan 6.25% 12/23/11	383,333	388,125	0.3

* The fund commenced operations on December 15, 2004 and holds 42 securities, excluding cash equivalents, which represent 88.9% of the fund's net assets.

Annual Report

Fidelity High Income Central Investment Portfolio 1

December 31, 2004 (Unaudited)

Top Fifty Holdings (excluding cash equivalents)

	Principal Amount	Value	% of Fund's Net Assets
Ship Finance International Ltd. 8.5% 12/15/13	$ 17,800,000	$ 18,333,983	1.7
Invensys PLC 9.875% 3/15/11	11,735,000	12,673,800	1.2
Teekay Shipping Corp. 8.875% 7/15/11	10,780,000	12,504,800	1.1
Micron Technology, Inc. 6.5% 9/30/05	11,761,905	11,732,500	1.1
General Maritime Corp. 10% 3/15/13	9,940,000	11,431,000	1.1
EchoStar DBS Corp. 5.75% 10/1/08	10,505,000	10,662,575	1.0
Celestica, Inc. 7.875% 7/1/11	9,430,000	10,090,100	0.9
Millicom International Cellular SA 10% 12/1/13	8,805,000	9,201,225	0.8
Western Financial Bank 9.625% 5/15/12	8,060,000	9,188,400	0.8
PerkinElmer, Inc. 8.875% 1/15/13	7,470,000	8,497,125	0.8
OMI Corp. 7.625% 12/1/13	7,645,000	8,180,150	0.8
TFM SA de CV yankee 11.75% 6/15/09	8,030,000	8,150,450	0.8
BCP Caylux Holdings Luxembourg SCA 9.625% 6/15/14	7,120,000	7,974,400	0.7
Compass Minerals International, Inc. 0% 6/1/13	9,175,000	7,431,750	0.7
Gerdau AmeriSteel Corp./GUSAP Partners 10.375% 7/15/11	6,015,000	7,067,625	0.7
The Reader's Digest Association, Inc. 6.5% 3/1/11	6,610,000	6,907,450	0.6
Qwest Capital Funding, Inc. 7.25% 2/15/11	7,055,000	6,772,800	0.6
Wyndham International, Inc. term loan 7.125% 6/30/06	6,739,515	6,756,364	0.6
Hanover Compressor Co. 0% 3/31/07	7,660,000	6,664,200	0.6
NRG Energy, Inc. 8% 12/15/13	5,998,000	6,545,318	0.6
MGM MIRAGE 6% 10/1/09	6,360,000	6,519,000	0.6
KB Home 7.75% 2/1/10	6,055,000	6,509,125	0.6
Norske Skog Canada Ltd. 8.625% 6/15/11	6,065,000	6,489,550	0.6
Tenet Healthcare Corp. 6.375% 12/1/11	6,995,000	6,435,400	0.6
Millennium America, Inc. 9.25% 6/15/08	5,690,000	6,429,700	0.6
Elan Finance PLC/Elan Finance Corp. 7.75% 11/15/11	5,980,000	6,398,600	0.6
Mohegan Tribal Gaming Authority 6.375% 7/15/09	6,185,000	6,393,744	0.6
American Real Estate Partners/American Real Estate Finance Corp. 8.125% 6/1/12	5,920,000	6,312,200	0.6
Huntsman LLC 9.32% 7/15/11	5,660,000	6,310,900	0.6
Wheeling Island Gaming, Inc. 10.125% 12/15/09	5,835,000	6,214,275	0.6
General Growth Properties, Inc.:
Tranche B, term loan 4.53% 11/12/08	6,100,000	6,115,250	0.6
Tranche A, term loan 4.53% 11/12/07	6,100,000	6,100,000	0.6
Berry Plastics Corp. 10.75% 7/15/12	5,310,000	6,066,675	0.6
Astoria Energy LLC term loan 7.1882% 4/15/12	5,890,000	6,007,800	0.6
Levi Strauss & Co. 12.25% 12/15/12	5,370,000	5,960,700	0.5
Hilton Head Communications LP Tranche B, term loan 6.5% 3/31/08	6,050,000	5,944,125	0.5
Sonic Automotive, Inc. 8.625% 8/15/13	5,550,000	5,938,500	0.5
CDRV Investors, Inc. 0% 1/1/15	9,590,000	5,921,825	0.5
Hilcorp Energy I LP/Hilcorp Finance Co. 10.5% 9/1/10	5,205,000	5,881,650	0.5
Riverside Energy Center LLC term loan 6.38% 6/24/11	5,793,001	5,879,896	0.5
Wise Metals Group LLC/Alloys Finance 10.25% 5/15/12	5,830,000	5,830,000	0.5
Asbury Automotive Group, Inc. 9% 6/15/12	5,420,000	5,704,550	0.5
Xerox Corp. 7.125% 6/15/10	5,235,000	5,653,800	0.5
Browning-Ferris Industries, Inc. 6.375% 1/15/08	5,755,000	5,639,900	0.5
Range Resources Corp. 7.375% 7/15/13	5,235,000	5,601,450	0.5
Texas Industries, Inc. 10.25% 6/15/11	4,650,000	5,487,000	0.5
Owens-Brockway Glass Container, Inc. 8.875% 2/15/09	5,050,000	5,479,250	0.5
U.S. West Capital Funding, Inc. 6.375% 7/15/08	5,547,000	5,477,663	0.5
Nextel Communications, Inc. 6.875% 10/31/13	4,970,000	5,392,450	0.5
Qwest Capital Funding, Inc. 7% 8/3/09	5,440,000	5,385,600	0.5

Top 50 Holdings as a Percentage of Fund's Net Assets - 33.6%

Annual Report

Trustees and Officers

The funds' Statement of Additional Information (SAI) includes more information about the Trustees. To request a free copy, call Fidelity at 1-800-544-5429.

Interested Trustees*:

Correspondence intended for each Trustee who is an "interested person" (as defined in the 1940 Act) may be sent to Fidelity Investments, 82 Devonshire Street, Boston, Massachusetts 02109.

Name, Age; Principal Occupation
Edward C. Johnson 3d (74)**
	Year of Election or Appointment: 1981, 1988 or 1994 Trustee of Variable Insurance Products Fund (1981), Variable Insurance Products Fund II (1988), and Variable Insurance Products Fund III (1994). Mr. Johnson is Chairman of the Board of Trustees. Mr. Johnson serves as Chief Executive Officer, Chairman, and a Director of FMR Corp.; a Director and Chairman of the Board and of the Executive Committee of FMR; Chairman and a Director of Fidelity Management & Research (Far East) Inc.; Chairman (1998) and a Director of Fidelity Investments Money Management, Inc.; and Chairman (2001) and a Director (2000) of FMR Co., Inc.
Abigail P. Johnson (43)**
	Year of Election or Appointment: 2001 Senior Vice President of VIP Asset Manager: Growth (2001), VIP Balanced (2001), VIP Growth & Income (2001), VIP Growth Opportunities (2001), VIP Investment Grade Bond (2001), VIP Mid Cap (2001), and VIP Money Market (2001). Ms. Johnson also serves as Senior Vice President of other Fidelity funds (2001). She is President and a Director of FMR (2001), Fidelity Investments Money Management, Inc. (2001), FMR Co., Inc. (2001), and a Director of FMR Corp. Previously, Ms. Johnson managed a number of Fidelity funds.
Laura B. Cronin (50)
	Year of Election or Appointment: 2003 Ms. Cronin is an Executive Vice President (2002) and Chief Financial Officer (2002) of FMR Corp. and is a member of the Fidelity Management Committee (2003). Previously, Ms. Cronin served as Vice President of Finance of FMR (1997-1999), and Chief Financial Officer of FMR (1999-2001), Fidelity Personal Investments (2001), and Fidelity Brokerage Company (2001-2002).
Robert L. Reynolds (52)
	Year of Election or Appointment: 2003 Mr. Reynolds is a Director (2003) and Chief Operating Officer (2002) of FMR Corp. and is the head of the Fidelity Management Committee (2003). He also serves on the Board at Fidelity Investments Canada, Ltd. (2000). Previously, Mr. Reynolds served as President of Fidelity Investments Institutional Retirement Group (1996-2000).

* Trustees have been determined to be "Interested Trustees" by virtue of, among other things, their affiliation with the trusts or various entities under common control with FMR.

** Edward C. Johnson 3d, Trustee, is Abigail P. Johnson's father.

Annual Report

Non-Interested Trustees:

Dennis J. Dirks (56)
	Year of Election or Appointment: 2005 Mr. Dirks also serves as a Trustee (2005) or Member of the Advisory Board (2004) of other investment companies advised by FMR. Prior to his retirement in May 2003, Mr. Dirks was Chief Operating Officer and a member of the Board of The Depository Trust & Clearing Corporation (DTCC) (1999-2003). He also served as President, Chief Operating Officer, and Board member of The Depository Trust Company (DTC) (1999-2003) and President and Board member of the National Securities Clearing Corporation (NSCC) (1999-2003). In addition, Mr. Dirks served as Chief Executive Officer and Board member of the Government Securities Clearing Corporation (2001-2003) and Chief Executive Officer and Board member of the Mortgage-Backed Securities Clearing Corporation (2001-2003).
Robert M. Gates (61)
	Year of Election or Appointment: 1997 Dr. Gates is Vice Chairman of the non-interested Trustees (2005). Dr. Gates is President of Texas A&M University (2002). He was Director of the Central Intelligence Agency (CIA) from 1991 to 1993. From 1989 to 1991, Dr. Gates served as Assistant to the President of the United States and Deputy National Security Advisor. Dr. Gates is a Director of NACCO Industries, Inc. (mining and manufacturing), Parker Drilling Co., Inc. (drilling and rental tools for the energy industry, 2001), and Brinker International (restaurant management, 2003). He also serves as a member of the Advisory Board of VoteHere.net (secure Internet voting, 2001). Previously, Dr. Gates served as a Director of LucasVarity PLC (automotive components and diesel engines), a Director of TRW Inc. (automotive, space, defense, and information technology), and Dean of the George Bush School of Government and Public Service at Texas A&M University (1999-2001). Dr. Gates also is a Trustee of the Forum for International Policy.
George H. Heilmeier (68)
	Year of Election or Appointment: 2004 Dr. Heilmeier is Chairman Emeritus of Telcordia Technologies (communication software and systems), where prior to his retirement, he served as company Chairman and Chief Executive Officer. He currently serves on the Boards of Directors of The Mitre Corporation (systems engineering and information technology support for the government), INET Technologies Inc. (telecommunications network surveillance, 2001), Teletech Holdings (customer management services), and HRL Laboratories (private research and development, 2004). He is Chairman of the General Motors Technology Advisory Committee and a Life Fellow of the Institute of Electrical and Electronics Engineers (IEEE) (2000). Dr. Heilmeier is a member of the Defense Science Board and the National Security Agency Advisory Board. He is also a member of the National Academy of Engineering, the American Academy of Arts and Sciences, and the Board of Overseers of the School of Engineering and Applied Science of the University of Pennsylvania. Previously, Dr. Heilmeier served as a Director of TRW Inc. (automotive, space, defense, and information technology, 1992-2002), Compaq (1994-2002), and Automatic Data Processing, Inc. (ADP) (technology-based business outsourcing, 1995-2002).
Marie L. Knowles (58)
	Year of Election or Appointment: 2001 Prior to Ms. Knowles' retirement in June 2000, she served as Executive Vice President and Chief Financial Officer of Atlantic Richfield Company (ARCO) (diversified energy, 1996-2000). From 1993 to 1996, she was a Senior Vice President of ARCO and President of ARCO Transportation Company. She served as a Director of ARCO from 1996 to 1998. She currently serves as a Director of Phelps Dodge Corporation (copper mining and manufacturing), URS Corporation (multidisciplinary engineering, 1999), and McKesson Corporation (healthcare service, 2002). Ms. Knowles is a Trustee of the Brookings Institution and the Catalina Island Conservancy and also serves as a member of the Advisory Board for the School of Engineering of the University of Southern California.
Ned C. Lautenbach (60)
	Year of Election or Appointment: 2000 Mr. Lautenbach has been a partner of Clayton, Dubilier & Rice, Inc. (private equity investment firm) since September 1998. Previously, Mr. Lautenbach was with the International Business Machines Corporation (IBM) from 1968 until his retirement in 1998. He was most recently Senior Vice President and Group Executive of Worldwide Sales and Services. From 1993 to 1995, he was Chairman of IBM World Trade Corporation, and from 1994 to 1998 was a member of IBM's Corporate Executive Committee. Mr. Lautenbach serves as Co-Chairman and a Director of Covansys, Inc. (global provider of business and technology solutions, 2000). In addition, he is a Director of Italtel Holding S.p.A. (telecommunications (Milan, Italy), 2004) and Eaton Corporation (diversified industrial) as well as the Philharmonic Center for the Arts in Naples, Florida (1999). He also is a member of the Council on Foreign Relations.

Marvin L. Mann (71)
	Year of Election or Appointment: 1993 or 1994 Trustee of Variable Insurance Products Fund (1993), Variable Insurance Products Fund II (1993), and Variable Insurance Products Fund III (1994). Mr. Mann is Chairman of the non-interested Trustees (2001). He is Chairman Emeritus of Lexmark International, Inc. (computer peripherals), where he served as CEO until April 1998, retired as Chairman May 1999, and remains a member of the Board. Prior to 1991, he held the positions of Vice President of International Business Machines Corporation (IBM) and President and General Manager of various IBM divisions and subsidiaries. He is a member of the Executive Committee of the Independent Director's Council of the Investment Company Institute. In addition, Mr. Mann is a member of the President's Cabinet at the University of Alabama and the Board of Visitors of the Culverhouse College of Commerce and Business Administration at the University of Alabama.
William O. McCoy (71)
	Year of Election or Appointment: 1997 Prior to his retirement in December 1994, Mr. McCoy was Vice Chairman of the Board of BellSouth Corporation (telecommunications) and President of BellSouth Enterprises. He is currently a Director of Liberty Corporation (holding company), Duke Realty Corporation (real estate), and Progress Energy, Inc. (electric utility). He is also a partner of Franklin Street Partners (private investment management firm) and a member of the Research Triangle Foundation Board. In addition, Mr. McCoy served as the Interim Chancellor (1999-2000) and a member of the Board of Visitors (1994-1998) for the University of North Carolina at Chapel Hill and currently serves on the Board of Directors of the University of North Carolina Health Care System and the Board of Visitors of the Kenan-Flagler Business School (University of North Carolina at Chapel Hill). He also served as Vice President of Finance for the University of North Carolina (16-school system, 1995-1998).
Cornelia M. Small (60)
	Year of Election or Appointment: 2005 Ms. Small is a member (2000) and Chairperson (2002) of the Investment Committee, and a member (2002) of the Board of Trustees of Smith College. Previously, she served as Chief Investment Officer (1999-2000), Director of Global Equity Investments (1996-1999), and a member of the Board of Directors of Scudder, Stevens & Clark (1990-1997) and Scudder Kemper Investments (1997-1998). In addition, Ms. Small served as Co-Chair (2000-2003) of the Annual Fund for the Fletcher School of Law and Diplomacy.
William S. Stavropoulos (65)
	Year of Election or Appointment: 2001 or 2002 Trustee of Variable Insurance Products Fund (2001), Variable Insurance Products Fund II (2001), and Variable Insurance Products Fund III (2002). Mr. Stavropoulos is Chairman of the Board (2000), CEO (2002), a position he previously held from 1995-2000, Chairman of the Executive Committee (2000), and a Member of the Board of Directors of The Dow Chemical Company. Since joining The Dow Chemical Company in 1967, Mr. Stavropoulos served in numerous senior management positions, including President (1993-2000; 2002-2003). Currently, he is a Director of NCR Corporation (data warehousing and technology solutions), BellSouth Corporation (telecommunications), Chemical Financial Corporation, and Maersk Inc. (industrial conglomerate, 2002). He also serves as a member of the Board of Trustees of the American Enterprise Institute for Public Policy Research. In addition, Mr. Stavropoulos is a member of The Business Council, J.P. Morgan International Council and the University of Notre Dame Advisory Council for the College of Science.
Kenneth L. Wolfe (65)
	Year of Election or Appointment: 2005 Mr. Wolfe also serves as a Trustee (2005) or Member of the Advisory Board (2004) of other investment companies advised by FMR. Prior to his retirement in 2001, Mr. Wolfe was Chairman and Chief Executive Officer of Hershey Foods Corporation (1993-2001). He currently serves as a member of the boards of Adelphia Communications Corporation (2003), Bausch & Lomb, Inc., and Revlon Inc. (2004).

Annual Report

Advisory Board Member and Executive Officers:

Correspondence intended for each executive officer and Mr. Lynch may be sent to Fidelity Investments, 82 Devonshire Street, Boston, Massachusetts 02109

Name, Age; Principal Occupation
Peter S. Lynch (61)
	Year of Election or Appointment: 2003 Member of the Advisory Board of Variable Insurance Products Fund, Variable Insurance Products Fund II and Variable Insurance Products Fund III. Vice Chairman and a Director of FMR, and Vice Chairman (2001) and a Director (2000) of FMR Co., Inc. Previously, Mr. Lynch served as a Trustee of the Fidelity funds (1990-2003). Prior to May 31, 1990, he was a Director of FMR and Executive Vice President of FMR (a position he held until March 31, 1991), Vice President of Fidelity^® Magellan^® Fund and FMR Growth Group Leader, and Managing Director of FMR Corp. Mr. Lynch was also Vice President of Fidelity Investments Corporate Services. In addition, he serves as a Trustee of Boston College, Massachusetts Eye & Ear Infirmary, Historic Deerfield, John F. Kennedy Library, and the Museum of Fine Arts of Boston.
Bart A. Grenier (45)
	Year of Election or Appointment: 2001 Vice President of VIP Asset Manager: Growth, VIP Balanced, and VIP Growth & Income. Mr. Grenier also serves as Vice President of certain Equity Funds (2001), a position he previously held from 1999 to 2000, and Vice President of certain High Income Funds (2002). He is Senior Vice President of FMR (1999) and FMR Co., Inc. (2001), and President and Director of Strategic Advisers, Inc. (2002). He also heads Fidelity's Asset Allocation Group (2000), Fidelity's Growth and Income Group (2001), Fidelity's Value Group (2001), and Fidelity's High Income Division (2001). Previously, Mr. Grenier served as President of Fidelity Ventures (2000), Vice President of certain High Income Funds (1997-2000), High Income Division Head (1997-2000), Group Leader of the Income-Growth and Asset Allocation-Income Groups (1996-2000), and Assistant Equity Division Head (1997-2000).
John B. McDowell (46)
	Year of Election or Appointment: 2002 Vice President of VIP Growth Opportunities and VIP Mid Cap. Mr. McDowell also serves as Vice President of certain Equity Funds (2002). He is Senior Vice President of FMR (1999), FMR Co., Inc. (2001), and Fidelity Management Trust Company (FMTC). Since joining Fidelity Investments in 1985, Mr. McDowell has worked as a research analyst and manager.
Charles S. Morrison (44)
	Year of Election or Appointment: 2002 Vice President of VIP Asset Manager: Growth, VIP Balanced, and VIP Investment Grade Bond. Mr. Morrison also serves as Vice President of Fidelity's Bond Funds (2002), and Vice President of certain Asset Allocation and Balanced Funds (2002). He serves as Vice President (2002) and Bond Group Leader (2002) of Fidelity Investments Fixed Income Division. Mr. Morrison is also Vice President of FIMM (2002) and FMR (2002). Mr. Morrison joined Fidelity in 1987 as a Corporate Bond Analyst in the Fixed Income Research Division.
David L. Murphy (56)
	Year of Election or Appointment: 2002 Vice President of VIP Asset Manager: Growth and VIP Money Market. Mr. Murphy also serves as Vice President of Fidelity's Money Market Funds (2002) and Vice President of certain Asset Allocation Funds (2003). He serves as Senior Vice President (2000) and Money Market Group Leader (2002) of the Fidelity Investments Fixed Income Division. Mr. Murphy is also a Senior Vice President of FIMM (2003) and a Vice President of FMR (2000). Previously, Mr. Murphy served as Bond Group Leader (2000-2002) and Vice President of Fidelity's Taxable Bond Funds (2000-2002) and Fidelity's Municipal Bond Funds (2001-2002). Mr. Murphy joined Fidelity in 1989 as a portfolio manager in the Bond Group.
Thomas J. Allen (44)
	Year of Election or Appointment: 2003 Vice President of VIP Mid Cap. Mr. Allen also serves as Vice President of another fund advised by FMR. Prior to assuming his current responsibilities, Mr. Allen managed a variety of Fidelity funds. Mr. Allen also serves as Vice President of FMR (2002) and FMR Co., Inc. (2002).
Bettina Doulton (40)
	Year of Election or Appointment: 2000 Vice President of VIP Growth Opportunities. Ms. Doulton also serves as Vice President of another fund advised by FMR. Prior to assuming her current responsibilities, Ms. Doulton managed a variety of Fidelity funds. Ms. Doulton also serves as Senior Vice President of FMR and FMR Co., Inc. (2001).
Richard C. Habermann (64)
	Year of Election or Appointment: 2001 Vice President of VIP Asset Manager: Growth. Mr. Habermann also serves as Vice President of other funds advised by FMR. Prior to assuming his current responsibilities, Mr. Habermann managed a variety of Fidelity funds. Mr. Habermann also serves as Senior Vice President of FMR and FMR Co., Inc. (2001).
Charles A. Mangum (40)
	Year of Election or Appointment: 2002 Vice President of VIP Asset Manager: Growth. Mr. Magnum also serves as Vice President of other funds advised by FMR. Prior to assuming his current responsibilities, Mr. Mangum managed a variety of Fidelity funds. Mr. Mangum also serves as Vice President of FMR and FMR Co., Inc. (2001).
Christine McConnell (46)
	Year of Election or Appointment: 2000 Vice President of VIP Asset Manager: Growth. Ms. McConnell also serves as Vice President of another fund advised by FMR. Prior to assuming her current responsibilities, Ms. McConnell managed a variety of Fidelity funds. Ms. McConnell also serves as Vice President of FMR (2003) and FMR Co., Inc. (2003).
James Kim Miller (41)
	Year of Election or Appointment: 2004 Vice President of VIP Asset Manager: Growth. Mr. Miller also serves as Vice President of other funds advised by FMR. Prior to assuming his current responsibilities, Mr. Miller managed a variety of Fidelity funds.
Ford E. O'Neil (42)
	Year of Election or Appointment: 2001 Vice President of VIP Asset Manager: Growth, VIP Balanced, and VIP Investment Grade Bond. Mr. O'Neil also serves as Vice President of other funds advised by FMR. Prior to assuming his current responsibilities, Mr. O'Neil managed a variety of Fidelity funds.
Louis Salemy (43)
	Year of Election or Appointment: 2000 or 2002 Vice President of VIP Balanced (2000) and VIP Growth & Income (2002). Mr. Salemy also serves as Vice President of other funds advised by FMR. Prior to assuming his current responsibilities, Mr. Salemy managed a variety of Fidelity funds. Mr. Salemy also serves as Vice President of FMR (2000) and FMR Co., Inc. (2001).
Eric D. Roiter (56)
	Year of Election or Appointment: 1998 Secretary of VIP Asset Manager: Growth, VIP Balanced, VIP Growth & Income, VIP Growth Opportunities, VIP Investment Grade Bond, VIP Mid Cap, VIP Money Market. He also serves as Secretary of other Fidelity funds; Vice President, General Counsel, and Secretary of FMR Co., Inc. (2001-present) and FMR; Vice President and Secretary of FDC; Assistant Secretary of Fidelity Management & Research (U.K.) Inc. (2001-present), Fidelity Management & Research (Far East) Inc. (2001-present); and Fidelity Investments Money Management, Inc. (2001-present). Mr. Roiter is an Adjunct Member, Faculty of Law, at Boston College Law School (2003).
Stuart Fross (45)
	Year of Election or Appointment: 2003 Assistant Secretary of VIP Asset Manager: Growth, VIP Balanced, VIP Growth & Income, VIP Growth Opportunities, VIP Investment Grade Bond, VIP Mid Cap, and VIP Money Market. Mr. Fross also serves as Assistant Secretary of other Fidelity funds (2003) and is an employee of FMR.
Christine Reynolds (46)
	Year of Election or Appointment: 2004 President, Treasurer, and Anti-Money Laundering (AML) officer of VIP Asset Manager: Growth, VIP Balanced, VIP Growth & Income, VIP Growth Opportunities, VIP Investment Grade Bond, VIP Mid Cap, and VIP Money Market. Ms. Reynolds also serves as President,Treasurer, and AML officer of other Fidelity funds (2004) and is a Vice President (2003) and an employee (2002) of FMR. Before joining Fidelity Investments, Ms. Reynolds worked at PricewaterhouseCoopers LLP (PwC) (1980-2002), where she was most recently an audit partner with PwC's investment management practice.
Timothy F. Hayes (54)
	Year of Election or Appointment: 2002 Chief Financial Officer of VIP Asset Manager: Growth, VIP Balanced, VIP Growth & Income, VIP Growth Opportunities, VIP Investment Grade Bond, VIP Mid Cap, and VIP Money Market. Mr. Hayes also serves as Chief Financial Officer of other Fidelity funds (2002). Recently he was appointed President of Fidelity Service Company (2003) where he also serves as a Director. Mr. Hayes also serves as President of Fidelity Investments Operations Group (FIOG, 2002), which includes Fidelity Pricing and Cash Management Services Group (FPCMS), where he was appointed President in 1998. Previously, Mr. Hayes served as Chief Financial Officer of Fidelity Investments Corporate Systems and Service Group (1998) and Fidelity Systems Company (1997-1998).
Kenneth A. Rathgeber (57)
	Year of Election or Appointment: 2004 Chief Compliance Officer of VIP Asset Manager: Growth, VIP Balanced, VIP Growth & Income, VIP Growth Opportunities, VIP Investment Grade Bond, VIP Mid Cap, and VIP Money Market. Mr. Rathgeber also serves as Chief Compliance Officer of other Fidelity funds (2004) and Executive Vice President of Risk Oversight for Fidelity Investments (2002). Previously, he served as Executive Vice President and Chief Operating Officer for Fidelity Investments Institutional Services Company, Inc. (1998-2002).
John R. Hebble (46)
	Year of Election or Appointment: 2003 Deputy Treasurer of VIP Asset Manager: Growth, VIP Balanced, VIP Growth & Income, VIP Growth Opportunities, VIP Investment Grade Bond, VIP Mid Cap, and VIP Money Market. Mr. Hebble also serves as Deputy Treasurer of other Fidelity funds (2003), and is an employee of FMR. Before joining Fidelity Investments, Mr. Hebble worked at Deutsche Asset Management where he served as Director of Fund Accounting (2002-2003) and Assistant Treasurer of the Scudder Funds (1998-2003).
Kimberley H. Monasterio (41)
	Year of Election or Appointment: 2004 Deputy Treasurer of VIP Asset Manager: Growth, VIP Balanced, VIP Growth & Income, VIP Growth Opportunities, VIP Investment Grade Bond, VIP Mid Cap, and VIP Money Market. Ms. Monasterio also serves as Deputy Treasurer of other Fidelity funds (2004) and is an employee of FMR (2004). Before joining Fidelity Investments, Ms. Monasterio served as Treasurer (2000-2004) and Chief Financial Officer (2002-2004) of the Franklin Templeton Funds and Senior Vice President of Franklin Templeton Services, LLC (2000-2004).
John H. Costello (58)
	Year of Election or Appointment: 1986 Assistant Treasurer of VIP Asset Manager: Growth, VIP Balanced, VIP Growth & Income, VIP Growth Opportunities, VIP Investment Grade Bond, VIP Mid Cap, and VIP Money Market. Mr. Costello also serves as Assistant Treasurer of other Fidelity funds and is an employee of FMR.
Peter L. Lydecker (50)
	Year of Election or Appointment: 2004 Assistant Treasurer of VIP Asset Manager: Growth, VIP Balanced, VIP Growth & Income, VIP Growth Opportunities, VIP Investment Grade Bond, VIP Mid Cap, and VIP Money Market. Mr. Lydecker also serves as Assistant Treasurer of other Fidelity funds (2004) and is an employee of FMR.
Mark Osterheld (49)
	Year of Election or Appointment: 2002 Assistant Treasurer of VIP Asset Manager: Growth, VIP Balanced, VIP Growth & Income, VIP Growth Opportunities, VIP Investment Grade Bond, VIP Mid Cap, and VIP Money Market. Mr. Osterheld also serves as Assistant Treasurer of other Fidelity funds (2002) and is an employee of FMR.
Kenneth B. Robins (35)
	Year of Election or Appointment: 2004 Assistant Treasurer of VIP Asset Manager: Growth, VIP Balanced, VIP Growth & Income, VIP Growth Opportunities, VIP Investment Grade Bond, VIP Mid Cap, and VIP Money Market. Mr. Robins also serves as Assistant Treasurer of other Fidelity funds (2004) and is an employee of FMR (2004). Before joining Fidelity Investments, Mr. Robins worked at KPMG LLP, where he was a partner in KPMG's department of professional practice (2002-2004) and a Senior Manager (1999-2000). In addition, Mr. Robins served as Assistant Chief Accountant, United States Securities and Exchange Commission (2000-2002).

Annual Report

Distributions

	Pay Date	Record Date	Dividends	Capital Gains
Balanced
Initial Class	2/11/05	2/11/05	$.365	$.01
Service Class	2/11/05	2/11/05	$.350	$.01
Service Class 2	2/11/05	2/11/05	$.335	$.01
Investment Grade Bond
Initial Class	2/11/05	2/11/05	$.480	$.29
Service Class	2/11/05	2/11/05	$.475	$.29
Service Class 2	2/11/05	2/11/05	$.460	$.29
Mid Cap
Initial Class	2/11/05	2/11/05	-	$.51
Service Class	2/11/05	2/11/05	-	$.51
Service Class 2	2/11/05	2/11/05	-	$.51

A percentage of the dividends distributed during the fiscal year for the following funds was derived from interest on U.S. Government securities which is generally exempt from state income tax:

Balanced	7.64%
Investment Grade Bond	7.80%

A percentage of the dividends distributed during the fiscal year for the following funds qualifies for the dividends-received deduction for corporate shareholders:

Asset Manager: Growth
Initial Class	45%
Service Class	46%
Service Class 2	48%
Balanced
Initial Class	36%
Service Class	37%
Service Class 2	40%
Growth & Income
Initial Class	100%
Service Class	100%
Service Class 2	100%
Growth Opportunities
Initial Class	100%
Service Class	100%
Service Class 2	100%

The funds will notify shareholders in January 2005 of amounts for use in preparing 2004 income tax returns.

Annual Report

Proxy Voting Results

PROPOSAL 1
To amend the Declaration of Trust to allow the Board of Trustees, if permitted by applicable law, to authorize fund mergers without shareholder approval. ^A
	# of Votes	% of Votes
Affirmative	15,331,508,529.96	81.853
Against	2,429,553,894.02	12.972
Abstain	969,378,618.94	5.175
TOTAL	18,730,441,042.92	100.000
PROPOSAL 2
To elect a Board of Trustees. ^A
	# of Votes	% of Votes
J. Michael Cook
Affirmative	17,770,642,454.98	94.876
Withheld	959,798,587.94	5.124
TOTAL	18,730,441,042.92	100.000
Ralph F. Cox
Affirmative	17,759,356,374.26	94.815
Withheld	971,084,668.66	5.185
TOTAL	18,730,441,042.92	100.000
Laura B. Cronin
Affirmative	17,797,888,742.24	95.021
Withheld	932,552,300.68	4.979
TOTAL	18,730,441,042.92	100.000
Dennis J. Dirks^B
Affirmative	17,802,602,074.45	95.046
Withheld	927,838,968.47	4.954
TOTAL	18,730,441,042.92	100.000
Robert M. Gates
Affirmative	17,784,855,823.58	94.952
Withheld	945,585,219.34	5.048
TOTAL	18,730,441,042.92	100.000
George H. Heilmeier
Affirmative	17,768,875,556.56	94.866
Withheld	961,565,486.36	5.134
TOTAL	18,730,441,042.92	100.000
Abigail P. Johnson
Affirmative	17,781,929,073.06	94.936
Withheld	948,511,969.86	5.064
TOTAL	18,730,441,042.92	100.000
Edward C. Johnson 3d
Affirmative	17,752,140,336.45	94.777
Withheld	978,300,706.47	5.223
TOTAL	18,730,441,042.92	100.000
Donald J. Kirk
Affirmative	17,772,467,361.45	94.885
Withheld	957,973,681.47	5.115
TOTAL	18,730,441,042.92	100.000
	# of Votes	% of Votes
Marie L. Knowles
Affirmative	17,776,922,254.30	94.909
Withheld	953,518,788.62	5.091
TOTAL	18,730,441,042.92	100.000
Ned C. Lautenbach
Affirmative	17,804,221,564.95	95.055
Withheld	926,219,477.97	4.945
TOTAL	18,730,441,042.92	100.000
Marvin L. Mann
Affirmative	17,763,277,607.06	94.836
Withheld	967,163,435.86	5.164
TOTAL	18,730,441,042.92	100.000
William O. McCoy
Affirmative	17,758,560,162.11	94.811
Withheld	971,880,880.81	5.189
TOTAL	18,730,441,042.92	100.000
Robert L. Reynolds
Affirmative	17,806,026,904.06	95.065
Withheld	924,414,138.86	4.935
TOTAL	18,730,441,042.92	100.000
Cornelia M. Small^B
Affirmative	17,798,878,892.31	95.026
Withheld	931,562,150.61	4.974
TOTAL	18,730,441,042.92	100.000
William S. Stavropoulos
Affirmative	17,786,496,107.78	94.960
Withheld	943,944,935.14	5.040
TOTAL	18,730,441,042.92	100.000
PROPOSAL 10
To amend the fundamental investment limitation concerning lending for Money Market Portfolio.
Money Market Portfolio
	# of Votes	% of Votes
Affirmative	1,322,266,118.44	88.289
Against	69,140,366.32	4.617
Abstain	106,243,856.98	7.094
TOTAL	1,497,650,341.74	100.000
^A Denotes trust-wide proposals and voting results. ^B Effective January 1, 2005.

Annual Report

Proxy Voting Results

PROPOSAL 1
To amend the Declaration of Trust to allow the Board of Trustees, if permitted by applicable law, to authorize fund mergers without shareholder approval. ^A
	# of Votes	% of Votes
Affirmative	10,633,156,497.88	78.949
Against	2,079,333,933.24	15.439
Abstain	755,879,753.86	5.612
TOTAL	13,468,370,184.98	100.000
PROPOSAL 2
To elect a Board of Trustees. ^A
	# of Votes	% of Votes
J. Michael Cook
Affirmative	12,653,134,619.02	93.947
Withheld	815,235,565.96	6.053
TOTAL	13,468,370,184.98	100.000
Ralph F. Cox
Affirmative	12,621,475,328.63	93.712
Withheld	846,894,856.35	6.288
TOTAL	13,468,370,184.98	100.000
Laura B. Cronin
Affirmative	12,672,564,623.97	94.091
Withheld	795,805,561.01	5.909
TOTAL	13,468,370,184.98	100.000
Dennis J. Dirks ^B
Affirmative	100,000,000.00	00.000
Withheld	100,000,000.00	00.000
TOTAL	13,468,370,184.98	100.000
Robert M. Gates
Affirmative	12,659,421,698.29	93.994
Withheld	808,948,486.69	6.006
TOTAL	13,468,370,184.98	100.000
George H. Heilmeier
Affirmative	12,643,445,665.25	93.875
Withheld	824,924,519.73	6.125
TOTAL	13,468,370,184.98	100.000
Abigail P. Johnson
Affirmative	12,656,994,867.39	93.976
Withheld	811,375,317.59	6.024
TOTAL	13,468,370,184.98	100.000
Edward C. Johnson 3d
Affirmative	12,611,555,734.60	93.638
Withheld	856,814,450.38	6.362
TOTAL	13,468,370,184.98	100.000
Donald J. Kirk
Affirmative	12,632,695,111.23	93.795
Withheld	835,675,073.75	6.205
TOTAL	13,468,370,184.98	100.000
	# of Votes	% of Votes
Marie L. Knowles
Affirmative	12,674,914,386.54	94.109
Withheld	793,455,798.44	5.891
TOTAL	13,468,370,184.98	100.000
Ned C. Lautenbach
Affirmative	12,679,654,480.45	94.144
Withheld	788,715,704.53	5.856
TOTAL	13,468,370,184.98	100.000
Marvin L. Mann
Affirmative	12,631,864,234.33	93.789
Withheld	836,505,950.65	6.211
TOTAL	13,468,370,184.98	100.000
William O. McCoy
Affirmative	12,627,373,668.93	93.756
Withheld	840,996,516.05	6.244
TOTAL	13,468,370,184.98	100.000
Robert L. Reynolds
Affirmative	12,676,011,492.18	94.117
Withheld	792,358,692.80	5.883
TOTAL	13,468,370,184.98	100.000
Cornelia M. Small ^B
Affirmative	12,673,927,441.76	94.101
Withheld	794,442,743.22	5.899
TOTAL	13,468,370,184.98	100.000
William S. Stavropoulos
Affirmative	12,650,527,834.35	93.928
Withheld	817,842,350.63	6.072
TOTAL	13,468,370,184.98	100.000
PROPOSAL 3
To amend the fundamental investment limitation concerning lending for each of Asset Manager: Growth Portfolio and Investment Grade Bond Portfolio.
Asset Manager: Growth Portfolio
	# of Votes	% of Votes
Affirmative	243,799,684.80	82.875
Against	28,038,786.42	9.531
Abstain	22,340,251.66	7.594
TOTAL	294,178,722.88	100.000
Investment Grade Bond Portfolio
	# of Votes	% of Votes
Affirmative	1,129,407,300.23	81.883
Against	142,181,660.75	10.309
Abstain	107,701,200.55	7.808
TOTAL	1,379,290,161.53	100.000
^A Denotes trust-wide proposals and voting results. ^B Effective January 1, 2005.

Annual Report

Proxy Voting Results

A special meeting of the Variable Insurance Products Fund III shareholders was held on December 14, 2004. The results of votes taken among shareholders on proposals before them are reported below. Each vote reported represents one dollar of net asset value held on the record date for the meeting.

PROPOSAL 1
To amend the Declaration of Trust to allow the Board of Trustees, if permitted by applicable law, to authorize fund mergers without shareholder approval. ^A
	# of Votes	% of Votes
Affirmative	4,465,365,699.61	80.317
Against	820,718,849.73	14.762
Abstain	273,620,539.56	4.921
TOTAL	5,559,705,088.90	100.000
PROPOSAL 2
To elect a Board of Trustees. ^A
	# of Votes	% of Votes
J. Michael Cook
Affirmative	5,275,527,318.06	94.889
Withheld	284,177,770.84	5.111
TOTAL	5,559,705,088.90	100.000
Ralph F. Cox
Affirmative	5,260,941,793.66	94.626
Withheld	298,763,295.24	5.374
TOTAL	5,559,705,088.90	100.000
Laura B. Cronin
Affirmative	5,275,571,233.79	94.889
Withheld	284,133,855.11	5.111
TOTAL	5,559,705,088.90	100.000
Dennis J. Dirks ^B
Affirmative	5,277,234,059.51	94.919
Withheld	282,471,029.39	5.081
TOTAL	5,559,705,088.90	100.000
Robert M. Gates
Affirmative	5,271,693,384.06	94.820
Withheld	288,011,704.84	5.180
TOTAL	5,559,705,088.90	100.000
George H. Heilmeier
Affirmative	5,276,712,546.15	94.910
Withheld	282,992,542.75	5.090
TOTAL	5,559,705,088.90	100.000
Abigail P. Johnson
Affirmative	5,265,412,678.20	94.707
Withheld	294,292,410.70	5.293
TOTAL	5,559,705,088.90	100.000
Edward C. Johnson 3d
Affirmative	5,252,813,997.03	94.480
Withheld	306,891,091.87	5.520
TOTAL	5,559,705,088.90	100.000
Donald J. Kirk
Affirmative	5,268,337,458.03	94.759
Withheld	291,367,630.87	5.241
TOTAL	5,559,705,088.90	100.000
	# of Votes	% of Votes
Marie L. Knowles
Affirmative	5,278,993,264.93	94.951
Withheld	280,711,823.97	5.049
TOTAL	5,559,705,088.90	100.000
Ned C. Lautenbach
Affirmative	5,280,591,428.18	94.980
Withheld	279,113,660.72	5.020
TOTAL	5,559,705,088.90	100.000
Marvin L. Mann
Affirmative	5,266,769,335.50	94.731
Withheld	292,935,753.40	5.269
TOTAL	5,559,705,088.90	100.000
William O. McCoy
Affirmative	5,270,804,685.62	94.804
Withheld	288,900,403.28	5.196
TOTAL	5,559,705,088.90	100.000
Robert L. Reynolds
Affirmative	5,279,190,479.65	94.955
Withheld	280,514,609.25	5.045
TOTAL	5,559,705,088.90	100.000
Cornelia M. Small ^B
Affirmative	5,276,074,654.01	94.898
Withheld	283,630,434.89	5.102
TOTAL	5,559,705,088.90	100.000
William S. Stavropoulos
Affirmative	5,278,183,775.21	94.936
Withheld	281,521,313.69	5.064
TOTAL	5,559,705,088.90	100.000
^A Denotes trust-wide proposals and voting results. ^B Effective January 1, 2005.

Annual Report

Investment Adviser

Fidelity Management & Research Company
Boston, MA

Investment Sub-Advisers

FMR Co., Inc.
Asset Manager: Growth, Balanced,
Growth & Income, Growth Opportunities,
and Mid Cap Portfolios

Fidelity Investments Money Management, Inc.
Asset Manager: Growth, Balanced,
Investment Grade Bond, and Money Market Portfolios

Fidelity Management & Research (U.K.) Inc.
Asset Manager: Growth, Balanced, Growth & Income,
Growth Opportunities, and Mid Cap Portfolios

Fidelity Management & Research (Far East) Inc.
Asset Manager: Growth, Balanced, Growth & Income,
Growth Opportunities, and Mid Cap Portfolios

Fidelity Investments Japan Limited
Asset Manager: Growth, Balanced, Growth & Income,
Growth Opportunities, and Mid Cap Portfolios

Fidelity International Investment Advisors
Asset Manager: Growth, Balanced, Growth & Income,
Growth Opportunities, Investment Grade Bond, Mid Cap
and Money Market Portfolios

Fidelity International Investment Advisors (U.K.) Limited
Asset Manager: Growth, Balanced, Growth & Income,
Growth Opportunities, Investment Grade Bond, Mid Cap
and Money Market Portfolios

General Distributor

Fidelity Distributors Corporation
Boston, MA

Transfer and Shareholder Servicing Agent

Fidelity Investments Institutional Operations Company, Inc.
Boston, MA

Custodian

The Bank of New York, New York, NY
Investment Grade Bond and Money Market Portfolios

JPMorgan Chase Bank, New York, NY
Asset Manager: Growth, Balanced,
and Growth & Income Portfolios
Brown Brothers Harriman & Co., Boston, MA
Mid Cap Portfolio

Mellon Bank, N.A., Pittsburgh, PA
Growth Opportunities Portfolio

VIPGRP2-ANN-0205
1.768593.103

Item 2. Code of Ethics

As of the end of the period, December 31, 2004, Variable Insurance Products Fund (the trust) has adopted a code of ethics, as defined in Item 2 of Form N-CSR, that applies to its President and Treasurer and its Chief Financial Officer. A copy of the code of ethics is filed as an exhibit to this Form N-CSR.

Item 3. Audit Committee Financial Expert

The Board of Trustees of the trust has determined that Marie L. Knowles is an audit committee financial expert, as defined in Item 3 of Form N-CSR. Ms. Knowles is independent for purposes of Item 3 of Form N-CSR.

Item 4. Principal Accountant Fees and Services

(a) Audit Fees.

For the fiscal years ended December 31, 2004 and December 31, 2003, the aggregate Audit Fees billed by PricewaterhouseCoopers LLP (PwC) for professional services rendered for the audits of the financial statements, or services that are normally provided in connection with statutory and regulatory filings or engagements for those fiscal years, for Equity-Income Portfolio, Growth Portfolio, High Income Portfolio, Money Market Portfolio and Overseas Portfolio (the funds) and for all funds in the Fidelity Group of Funds are shown in the table below.

Fund	2004^A	2003^A
Equity-Income Portfolio	$75,000	$64,000
Growth Portfolio	$70,000	$60,000
High Income Portfolio	$57,000	$80,000
Money Market Portfolio	$32,000	$29,000
Overseas Portfolio	$50,000	$55,000
All funds in the Fidelity Group of Funds audited by PwC	$10,800,000	$10,600,000

^A	Aggregate amounts may reflect rounding.

For the fiscal years ended December 31, 2004 and December 31, 2003, the aggregate Audit Fees billed by Deloitte & Touche LLP, the member firms of Deloitte Touche Tohmatsu, and their respective affiliates (collectively, "Deloitte Entities") for professional services rendered for the audits of the financial statements, or services that are normally provided in connection with statutory and regulatory filings or engagements for those fiscal years, for Value Portfolio (the fund) and for all funds in the Fidelity Group of Funds are shown in the table below.

Fund

2004^A

2003^A

Value Portfolio

$29,000

$26,000

All funds in the Fidelity Group of Funds audited by Deloitte Entities

$4,300,000

^A	Aggregate amounts may reflect rounding.

(b) Audit-Related Fees.

In each of the fiscal years ended December 31, 2004 and December 31, 2003, the aggregate Audit-Related Fees billed by PwC for services rendered for assurance and related services to each fund that are reasonably related to the performance of the audit or review of the fund's financial statements, but not reported as Audit Fees, are shown in the table below.

Fund	2004^A	2003 ^{A, B}
Equity-Income Portfolio	$0	$0
Growth Portfolio	$0	$0
High Income Portfolio	$0	$0
Money Market Portfolio	$0	$0
Overseas Portfolio	$0	$0

^A	Aggregate amounts may reflect rounding.

^B	Includes amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time.

In each of the fiscal years ended December 31, 2004 and December 31, 2003, the aggregate Audit-Related Fees billed by Deloitte Entities for services rendered for assurance and related services to the fund that are reasonably related to the performance of the audit or review of the fund's financial statements, but not reported as Audit Fees, are shown in the table below.

Fund	2004^A	2003 ^{A, B}
Value Portfolio	$0	$0

^A	Aggregate amounts may reflect rounding.

^B	Includes amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time.

In each of the fiscal years ended December 31, 2004 and December 31, 2003, the aggregate Audit-Related Fees that were billed by PwC and Deloitte Entities that were required to be approved by the Audit Committee for services rendered on behalf of Fidelity Management & Research Company (FMR) and entities controlling, controlled by, or under common control with FMR (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser) that provide ongoing services to the funds ("Fund Service Providers") for assurance and related services that relate directly to the operations and financial reporting of each fund that are reasonably related to the performance of the audit or review of the fund's financial statements, but not reported as Audit Fees, are shown in the table below.

Billed By	2004 ^A	2003^{A, B}
PwC	$0	$50,000
Deloitte Entities	$0	$0

^A	Aggregate amounts may reflect rounding.

^B	Includes amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time.

Fees included in the audit-related category comprise assurance and related services (e.g., due diligence services) that are traditionally performed by the independent registered public accounting firm. These audit-related services include due diligence related to mergers and acquisitions, accounting consultations and audits in connection with acquisitions, internal control reviews, attest services that are not required by statute or regulation and consultation concerning financial accounting and reporting standards.

In each of the fiscal years ended December 31, 2004 and December 31, 2003, the aggregate Tax Fees billed by PwC for professional services rendered for tax compliance, tax advice, and tax planning for each fund is shown in the table below.

Fund	2004^A	2003^{A, B}
Equity-Income Portfolio	$3,200	$3,000
Growth Portfolio	$2,400	$2,200
High Income Portfolio	$2,400	$2,200
Money Market Portfolio	$1,600	$1,500
Overseas Portfolio	$4,000	$3,700

^A	Aggregate amounts may reflect rounding.

^B	Includes amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time.

In each of the fiscal years ended December 31, 2004 and December 31, 2003, the aggregate Tax Fees billed by Deloitte Entities for professional services rendered for tax compliance, tax advice, and tax planning for the fund is shown in the table below.

Fund	2004^A	2003^{A, B}
Value Portfolio	$4,300	$4,100

^A	Aggregate amounts may reflect rounding.

^B	Includes amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time.

In each of the fiscal years ended December 31, 2004 and December 31, 2003, the aggregate Tax Fees billed by PwC and Deloitte Entities that were required to be approved by the Audit Committee for professional services rendered on behalf of the Fund Service Providers for tax compliance, tax advice, and tax planning that relate directly to the operations and financial reporting of each fund is shown in the table below.

Billed By	2004^A	2003^{A, B}
PwC	$0	$0
Deloitte Entities	$0	$0

^A	Aggregate amounts may reflect rounding.

^B	Includes amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time.

Fees included in the Tax Fees category comprise all services performed by professional staff in the independent registered public accounting firm's tax division except those services related to the audit. Typically, this category would include fees for tax compliance, tax planning, and tax advice. Tax compliance, tax advice, and tax planning services include preparation of original and amended tax returns, claims for refund and tax payment-planning services, assistance with tax audits and appeals, tax advice related to mergers and acquisitions and requests for rulings or technical advice from taxing authorities.

(d) All Other Fees.

In each of the fiscal years ended December 31, 2004 and December 31, 2003, the aggregate Other Fees billed by PwC for all other non-audit services rendered to the funds is shown in the table below.

Fund	2004^A	2003^{A, B}
Equity-Income Portfolio	$10,100	$8,700
Growth Portfolio	$10,000	$9,100
High Income Portfolio	$2,800	$2,600
Money Market Portfolio	$2,400	$3,100
Overseas Portfolio	$2,900	$2,400

^A	Aggregate amounts may reflect rounding.

^B	Includes amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time.

In each of the fiscal years ended December 31, 2004 and December 31, 2003, the aggregate Other Fees billed by Deloitte Entities for all other non-audit services rendered to the fund is shown in the table below.

Fund	2004^A	2003^{A, B}
Value Portfolio	$0	$0

^A	Aggregate amounts may reflect rounding.

^B	Includes amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time.

In each of the fiscal years ended December 31, 2004 and December 31, 2003, the aggregate Other Fees billed by PwC and Deloitte Entities that were required to be approved by the Audit Committee for all other non-audit services rendered on behalf of the Fund Service Providers that relate directly to the operations and financial reporting of each fund is shown in the table below.

Billed By	2004^A	2003^{A, B}
PwC	$490,000	$190,000
Deloitte Entities	$850,000	$150,000

^A	Aggregate amounts may reflect rounding.

^B	Includes amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time.

Fees included in the All Other Fees category include services related to internal control reviews, strategy and other consulting, financial information systems design and implementation, consulting on other information systems, and other tax services unrelated to the fund.

(e) (1)

Audit Committee Pre-Approval Policies and Procedures:

The trust's Audit Committee must pre-approve all audit and non-audit services provided by the independent registered public accounting firm relating to the operations or financial reporting of the funds. Prior to the commencement of any audit or non-audit services to a fund, the Audit Committee reviews the services to determine whether they are appropriate and permissible under applicable law.

The trust's Audit Committee has adopted policies and procedures to, among other purposes, provide a framework for the Committee's consideration of non-audit services by the audit firms that audit the Fidelity funds. The policies and procedures require that any non-audit service provided by a fund audit firm to a Fidelity Fund and any non-audit service provided by a fund auditor to a Fund Service Provider that relates directly to the operations and financial reporting of a Fidelity fund (Covered Service) are subject to approval by the Audit Committee before such service is provided. Non-audit services provided by a fund audit firm for a Fund Service Provider that do not relate directly to the operations and financial reporting of a Fidelity fund (Non-Covered Service) but that are expected to exceed $50,000 are also subject to pre-approval by the Audit Committee.

All Covered Services, as well as Non-Covered Services that are expected to exceed $50,000, must be approved in advance of provision of the service either: (i) by formal resolution of the Audit Committee, or (ii) by oral or written approval of the service by the Chair of the Audit Committee (or if the Chair is unavailable, such other member of the Audit Committee as may be designated by the Chair to act in the Chair's absence). The approval contemplated by (ii) above is permitted where the Treasurer determines that action on such an engagement is necessary before the next meeting of the Audit Committee. Neither pre-approval nor advance notice of Non-Covered Service engagements for which fees are not expected to exceed $50,000 is required; such engagements are to be reported to the Audit Committee monthly.

(e) (2)

Services approved pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X:

Audit-Related Fees:

There were no amounts, including amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time, that were approved by the Audit Committee pursuant to the de minimis exception for the fiscal years ended December 31, 2004 and December 31, 2003 on behalf of each fund.

There were no amounts, including amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time, that were required to be approved by the Audit Committee pursuant to the de minimis exception for the fiscal years ended December 31, 2004 and December 31, 2003 on behalf of the Fund Service Providers that relate directly to the operations and financial reporting of each fund.

Tax Fees:

There were no amounts, including amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time, that were required to be approved by the Audit Committee pursuant to the de minimis exception for the fiscal years ended December 31, 2004 and December 31, 2003 on behalf of the Fund Service Providers that relate directly to the operations and financial reporting of each fund.

All Other Fees:

There were no amounts, including amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time, that were required to be approved by the Audit Committee pursuant to the de minimis exception for the fiscal years ended December 31, 2004 and December 31, 2003 on behalf of the Fund Service Providers that relate directly to the operations and financial reporting of each fund.

(f) According to PwC for the fiscal year ended December 31, 2004, the percentage of hours spent on the audit of each fund's financial statements for the most recent fiscal year that were attributed to work performed by persons who are not full-time, permanent employees of PwC is as follows:

Fund	2004
Equity-Income Portfolio	0%
Growth Portfolio	0%
High Income Portfolio	0%
Money Market Portfolio	0%
Overseas Portfolio	0%

According to Deloitte Entities for the fiscal year ended December 31, 2004, the percentage of hours spent on the audit of the fund's financial statements for the most recent fiscal year that were attributed to work performed by persons who are not full-time, permanent employees of Deloitte Entities is as follows:

Fund	2004
Value Portfolio	0%

(g) For the fiscal years ended December 31, 2004 and December 31, 2003, the aggregate fees billed by PwC of $2,700,000^A and $1,950,000^A,Bfor non-audit services rendered on behalf of the funds, FMR (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser) and Fund Service Providers relating to Covered Services and Non-Covered Services are shown in the table below.

	2004^A	2003^A,B
Covered Services	$550,000	$300,000
Non-Covered Services	$2,150,000	$1,650,000

^A	Aggregate amounts may reflect rounding.
^B	Includes amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time.

For the fiscal years ended December 31, 2004 and December 31, 2003, the aggregate fees billed by Deloitte Entities of $1,350,000^Aand $1,350,000^{A, B}for non-audit services rendered on behalf of the fund, FMR (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser) and Fund Service Providers relating to Covered Services and Non-Covered Services are shown in the table below.

	2004^A	2003^{A, B}
Covered Services	$850,000	$150,000
Non-Covered Services	$500,000	$1,200,000

^A	Aggregate amounts may reflect rounding.
^B	Includes amounts related to non-audit services prior to May 6, 2003 that would have been subject to pre-approval if the SEC rules relating to the pre-approval of non-audit services had been in effect at that time.

(h) The trust's Audit Committee has considered Non-Covered Services that were not pre-approved that were provided by PwC and Deloitte Entities to Fund Service Providers to be compatible with maintaining the independence of PwC and Deloitte Entities in their audit of the funds, taking into account representations from PwC and Deloitte Entities, in accordance with Independence Standards Board Standard No.1, regarding their independence from the funds and their related entities.

Item 5. Audit Committee of Listed Registrants

Not applicable.

Item 6. Schedule of Investments

Not applicable.

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies

Not applicable.

Item 8. Portfolio Managers of Closed-End Management Investment Companies

Not applicable.

Item 9. Purchase of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers

Not applicable.

Item 10. Submission of Matters to a Vote of Security Holders

There were no material changes to the procedures by which shareholders may recommend nominees to the trust's Board of Trustees.

Item 11. Controls and Procedures

(a)(i) The President and Treasurer and the Chief Financial Officer have concluded that the trust's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act) provide reasonable assurances that material information relating to the trust is made known to them by the appropriate persons, based on their evaluation of these controls and procedures as of a date within 90 days of the filing date of this report.

(a)(ii) There was no change in the trust's internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act) that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the trust's internal control over financial reporting.

Item 12. Exhibits

(a)	(1)	Code of Ethics pursuant to Item 2 of Form N-CSR is filed and attached hereto as EX-99.CODE ETH.
(a)	(2)	Certification pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) is filed and attached hereto as Exhibit 99.CERT.
(a)	(3)	Not applicable.
(b)		Certification pursuant to Rule 30a-2(b) under the Investment Company Act of 1940 (17 CFR 270.30a-2(b)) is furnished and attached hereto as Exhibit 99.906CERT.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Variable Insurance Products Fund

By:	/s/Christine Reynolds
	Christine Reynolds
	President and Treasurer

Date:	February 24, 2005

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By:	/s/Christine Reynolds
	Christine Reynolds
	President and Treasurer

Date:	February 24, 2005

By:	/s/Timothy F. Hayes
	Timothy F. Hayes
	Chief Financial Officer

Date:	February 24, 2005

Fidelity® Variable Insurance Products

Contents

Shareholder Expense Example

Performance: The Bottom Line

Management's Discussion of Fund Performance

Investment Summary

Investments December 31, 2004

Financial Statements

Performance: The Bottom Line

Management's Discussion of Fund Performance

Investment Summary

Investments December 31, 2004

Financial Statements

Performance: The Bottom Line

Management's Discussion of Fund Performance

Investment Summary

Investments December 31, 2004

Financial Statements

Performance: The Bottom Line

Management's Discussion of Fund Performance

Investment Summary

Investments December 31, 2004

Financial Statements

Performance: The Bottom Line

Management's Discussion of Fund Performance

Investment Summary

Investments December 31, 2004

Financial Statements

Performance: The Bottom Line

Management's Discussion of Fund Performance

Investment Summary

Investments December 31, 2004

Financial Statements

Performance: The Bottom Line

Management's Discussion of Fund Performance

Investment Summary

Investments December 31, 2004

Financial Statements

Notes to Financial Statements

Report of Independent Registered Public Accounting Firm

Report of Independent Registered Public Accounting Firm

Report of Independent Registered Public Accounting Firm

Report of Independent Registered Public Accounting Firm

Report of Independent Registered Public Accounting Firm

Fidelity Floating Rate Central Investment Portfolio

Fidelity High Income Central Investment Portfolio 1

Trustees and Officers

Distributions

Proxy Voting Results

Proxy Voting Results

Fidelity® Variable Insurance Products

Contents

Shareholder Expense Example

Performance: The Bottom Line

Management's Discussion of Fund Performance

Investment Summary

Investments December 31, 2004

Financial Statements

Performance: The Bottom Line

Management's Discussion of Fund Performance

Investment Summary

Investments December 31, 2004

Financial Statements

Performance: The Bottom Line

Management's Discussion of Fund Performance

Investment Summary

Investments December 31, 2004

Financial Statements

Performance: The Bottom Line

Management's Discussion of Fund Performance

Investment Summary

Investments December 31, 2004

Financial Statements

Performance: The Bottom Line

Management's Discussion of Fund Performance

Investment Summary

Investments December 31, 2004

Financial Statements

Performance: The Bottom Line

Management's Discussion of Fund Performance