N-CSRS 1 main.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)

Scott C. Goebel, 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:

June 30, 2009

This report on Form N-CSR relates solely to the Registrant's Equity-Income Portfolio, Growth Portfolio, Overseas Portfolio and Value Portfolio series (each, a "Fund" and collectively, the "Funds").

Item 1. Reports to Stockholders

Fidelity® Variable Insurance Products:
Equity-Income Portfolio

Semiannual Report

June 30, 2009

(2_fidelity_logos) (Registered_Trademark)

Contents

Shareholder Expense Example

<Click Here>

An example of shareholder expenses.

Investment Changes

<Click Here>

A summary of major shifts in the fund's investments over the past six months.

Investments

<Click Here>

A complete list of the fund's investments with their market values.

Financial Statements

<Click Here>

Statements of assets and liabilities, operations, and changes in net assets, as well as financial highlights.

Notes

<Click Here>

Notes to the financial statements.

To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov. You may also call 1-877-208-0098 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 LLC or an affiliated company.

This report and the financial statements contained herein are submitted for the general information of the shareholders of the fund. This report is not authorized for distribution to prospective investors in the fund 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 holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com or http://www.advisor.fidelity.com, as applicable.

NOT FDIC INSURED · MAY LOSE VALUE · NO BANK GUARANTEE

Neither the fund nor Fidelity Distributors Corporation is a bank.

Semiannual Report

Shareholder Expense Example

As a shareholder of the 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 Fund 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 (January 1, 2009 to June 30, 2009).

Actual Expenses

The first line of the accompanying table for each class of the 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. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.

Hypothetical Example for Comparison Purposes

The second line of the accompanying table for each class of the 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. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.

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.

 



Annualized
Expense Ratio


Beginning
Account Value
January 1, 2009


Ending
Account Value
June 30, 2009

Expenses Paid
During Period*
January 1, 2009
to June 30, 2009

Initial Class

.59%

 

 

 

Actual

 

$ 1,000.00

$ 1,047.80

$ 3.00

Hypothetical A

 

$ 1,000.00

$ 1,021.87

$ 2.96

Service Class

.69%

 

 

 

Actual

 

$ 1,000.00

$ 1,047.20

$ 3.50

Hypothetical A

 

$ 1,000.00

$ 1,021.37

$ 3.46

Service Class 2

.84%

 

 

 

Actual

 

$ 1,000.00

$ 1,046.90

$ 4.26

Hypothetical A

 

$ 1,000.00

$ 1,020.63

$ 4.21

Service Class 2R

.84%

 

 

 

Actual

 

$ 1,000.00

$ 1,047.20

$ 4.26

Hypothetical A

 

$ 1,000.00

$ 1,020.63

$ 4.21

Investor Class

.70%

 

 

 

Actual

 

$ 1,000.00

$ 1,047.90

$ 3.55

Hypothetical A

 

$ 1,000.00

$ 1,021.32

$ 3.51

A 5% return per year before expenses

* Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).

Semiannual Report

Investment Changes (Unaudited)

Top Ten Stocks as of June 30, 2009

 

% of fund's
net assets

% of fund's net assets
6 months ago

JPMorgan Chase & Co.

3.7

3.4

AT&T, Inc.

3.5

4.1

Exxon Mobil Corp.

3.4

4.9

Wells Fargo & Co.

3.3

3.2

Bank of America Corp.

3.0

2.5

Chevron Corp.

3.0

3.5

Verizon Communications, Inc.

1.8

2.1

Wyeth

1.7

1.2

Goldman Sachs Group, Inc.

1.7

0.6

ConocoPhillips

1.6

2.0

 

26.7

Top Five Market Sectors as of June 30, 2009

 

% of fund's
net assets

% of fund's net assets
6 months ago

Financials

25.3

23.0

Energy

15.3

18.3

Consumer Discretionary

13.5

12.2

Information Technology

8.9

8.2

Health Care

8.7

9.1

Asset Allocation (% of fund's net assets)

As of June 30, 2009*

As of December 31, 2008**

fid4705

Stocks 97.2%

 

fid4705

Stocks 98.5%

 

fid4708

Bonds 1.8%

 

fid4708

Bonds 1.2%

 

fid4711

Short-Term
Investments and
Net Other Assets 1.0%

 

fid4711

Short-Term
Investments and
Net Other Assets 0.3%

 

* Foreign investments

10.8%

 

** Foreign investments

10.6%

 


fid4714

Semiannual Report

Investments June 30, 2009 (Unaudited)

Showing Percentage of Net Assets

Common Stocks - 95.4%

Shares

Value

CONSUMER DISCRETIONARY - 12.6%

Auto Components - 1.4%

Gentex Corp.

561,936

$ 6,518,458

Johnson Controls, Inc.

1,490,110

32,365,189

Magna International, Inc. Class A

129,600

5,498,891

The Goodyear Tire & Rubber Co. (a)

2,247,200

25,303,472

 

69,686,010

Automobiles - 0.5%

Fiat SpA (a)

954,377

9,585,125

Ford Motor Co. (a)

676,891

4,108,728

Harley-Davidson, Inc. (e)

802,750

13,012,578

Winnebago Industries, Inc.

144,011

1,070,002

 

27,776,433

Diversified Consumer Services - 0.7%

H&R Block, Inc.

1,966,986

33,891,169

Hotels, Restaurants & Leisure - 0.6%

Las Vegas Sands Corp. unit

112,000

14,792,960

Starbucks Corp. (a)

1,335,700

18,552,873

 

33,345,833

Household Durables - 1.6%

Black & Decker Corp.

327,151

9,376,148

Centex Corp.

963,300

8,149,518

KB Home

178,100

2,436,408

Lennar Corp. Class A

340,500

3,299,445

Newell Rubbermaid, Inc.

1,699,520

17,692,003

Pulte Homes, Inc.

726,551

6,415,445

The Stanley Works

278,036

9,408,738

Whirlpool Corp.

549,334

23,379,655

 

80,157,360

Internet & Catalog Retail - 0.1%

Liberty Media Corp. Interactive Series A (a)

845,069

4,233,796

Leisure Equipment & Products - 0.1%

Brunswick Corp.

1,013,757

4,379,430

Media - 2.9%

Ascent Media Corp. (a)

45,847

1,218,613

Belo Corp. Series A

952,224

1,704,481

CC Media Holdings, Inc. Class A (a)

693,958

693,958

Comcast Corp. Class A

2,224,736

32,236,425

DreamWorks Animation SKG, Inc. Class A (a)

66,800

1,843,012

Informa PLC

1,802,640

6,494,693

Interpublic Group of Companies, Inc. (a)

1,137,000

5,741,850

Liberty Global, Inc. Class A (a)

503,612

8,002,395

Scripps Networks Interactive, Inc. Class A

192,886

5,368,017

The Walt Disney Co.

1,112,400

25,952,292

Time Warner, Inc.

1,567,983

39,497,492

Viacom, Inc. Class B (non-vtg.) (a)

445,400

10,110,580

Virgin Media, Inc.

906,431

8,475,130

 

147,338,938

 

Shares

Value

Multiline Retail - 1.9%

Kohl's Corp. (a)

1,043,953

$ 44,628,991

Macy's, Inc.

844,900

9,936,024

Target Corp.

993,700

39,221,339

Tuesday Morning Corp. (a)

445,123

1,500,065

 

95,286,419

Specialty Retail - 2.8%

Home Depot, Inc.

2,343,600

55,379,268

Lowe's Companies, Inc.

1,022,078

19,838,534

OfficeMax, Inc.

513,300

3,223,524

RadioShack Corp.

368,100

5,138,676

Staples, Inc.

1,795,345

36,212,109

Tiffany & Co., Inc.

572,345

14,514,669

Williams-Sonoma, Inc.

477,400

5,666,738

 

139,973,518

Textiles, Apparel & Luxury Goods - 0.0%

Liz Claiborne, Inc.

668,615

1,925,611

TOTAL CONSUMER DISCRETIONARY

637,994,517

CONSUMER STAPLES - 6.1%

Beverages - 1.3%

Carlsberg AS Series B

489,873

31,421,932

The Coca-Cola Co.

754,265

36,197,177

 

67,619,109

Food & Staples Retailing - 1.3%

CVS Caremark Corp.

606,005

19,313,379

Wal-Mart Stores, Inc.

628,463

30,442,748

Walgreen Co.

370,849

10,902,961

Winn-Dixie Stores, Inc. (a)

435,720

5,463,929

 

66,123,017

Food Products - 1.0%

Marine Harvest ASA (a)(e)

16,379,000

11,000,479

Nestle SA (Reg.)

632,826

23,835,825

Tyson Foods, Inc. Class A

1,240,027

15,636,740

 

50,473,044

Household Products - 1.2%

Kimberly-Clark Corp.

477,700

25,045,811

Procter & Gamble Co.

649,142

33,171,156

 

58,216,967

Personal Products - 0.4%

Avon Products, Inc.

873,658

22,522,903

Tobacco - 0.9%

Philip Morris International, Inc.

1,006,905

43,921,196

TOTAL CONSUMER STAPLES

308,876,236

ENERGY - 15.3%

Energy Equipment & Services - 2.7%

BJ Services Co.

400,724

5,461,868

Halliburton Co.

799,295

16,545,407

Nabors Industries Ltd. (a)

947,513

14,762,253

Common Stocks - continued

Shares

Value

ENERGY - continued

Energy Equipment & Services - continued

Noble Corp.

1,330,468

$ 40,246,657

Pride International, Inc. (a)

410,300

10,282,118

Schlumberger Ltd. (NY Shares)

917,657

49,654,420

 

136,952,723

Oil, Gas & Consumable Fuels - 12.6%

Anadarko Petroleum Corp.

183,500

8,329,065

Apache Corp.

380,380

27,444,417

Chevron Corp.

2,256,529

149,495,046

ConocoPhillips

1,969,810

82,850,209

CONSOL Energy, Inc.

226,690

7,698,392

Devon Energy Corp.

144,700

7,886,150

EOG Resources, Inc.

467,000

31,718,640

Exxon Mobil Corp.

2,440,330

170,603,470

Hess Corp.

90,700

4,875,125

Marathon Oil Corp.

606,800

18,282,884

Occidental Petroleum Corp.

693,009

45,606,922

Peabody Energy Corp.

222,361

6,706,408

Royal Dutch Shell PLC:

Class A sponsored ADR

1,009,300

50,656,767

Class B ADR

232,200

11,809,692

Williams Companies, Inc.

782,300

12,211,703

 

636,174,890

TOTAL ENERGY

773,127,613

FINANCIALS - 24.3%

Capital Markets - 6.0%

Bank of New York Mellon Corp.

2,412,295

70,704,366

Credit Suisse Group sponsored ADR

676,600

30,940,918

Goldman Sachs Group, Inc.

580,394

85,573,291

KKR Private Equity Investors, LP Restricted Depositary Units (a)(f)

601,500

3,609,000

Morgan Stanley

2,435,577

69,438,300

State Street Corp.

363,980

17,179,856

T. Rowe Price Group, Inc.

69,500

2,896,065

UBS AG:

(For. Reg.) (a)

657,300

8,071,717

(NY Shares) (a)

1,106,200

13,506,702

 

301,920,215

Commercial Banks - 6.4%

Associated Banc-Corp.

1,137,055

14,213,188

Comerica, Inc.

506,000

10,701,900

Huntington Bancshares, Inc.

609,700

2,548,546

KeyCorp

3,193,400

16,733,416

Mitsubishi UFJ Financial Group, Inc. sponsored ADR

3,542,625

21,751,718

PNC Financial Services Group, Inc.

1,322,730

51,335,151

Sterling Financial Corp., Washington (e)

732,527

2,131,654

SunTrust Banks, Inc.

418,400

6,882,680

 

Shares

Value

U.S. Bancorp, Delaware

1,660,138

$ 29,749,673

Wells Fargo & Co.

6,914,709

167,750,840

 

323,798,766

Consumer Finance - 1.1%

Capital One Financial Corp.

890,199

19,477,554

Discover Financial Services

2,519,369

25,873,920

Promise Co. Ltd.

332,700

4,258,256

SLM Corp. (a)

904,032

9,284,409

 

58,894,139

Diversified Financial Services - 7.0%

Bank of America Corp.

11,432,479

150,908,723

CIT Group, Inc.

1,322,497

2,843,369

Citigroup, Inc. (e)

2,080,703

6,179,688

CME Group, Inc.

16,146

5,023,182

JPMorgan Chase & Co.

5,487,812

187,189,263

 

352,144,225

Insurance - 2.6%

ACE Ltd.

674,496

29,832,958

Hartford Financial Services Group, Inc.

583,700

6,928,519

Lincoln National Corp.

337,500

5,808,375

MBIA, Inc. (a)

414,697

1,795,638

MetLife, Inc.

497,173

14,920,162

Montpelier Re Holdings Ltd.

1,088,000

14,459,520

PartnerRe Ltd.

332,524

21,597,434

The Travelers Companies, Inc.

720,596

29,573,260

XL Capital Ltd. Class A

560,002

6,417,623

 

131,333,489

Real Estate Investment Trusts - 0.6%

Annaly Capital Management, Inc.

606,500

9,182,410

Developers Diversified Realty Corp.

439,967

2,147,039

HCP, Inc.

575,400

12,192,726

Senior Housing Properties Trust (SBI)

492,956

8,045,042

 

31,567,217

Real Estate Management & Development - 0.4%

CB Richard Ellis Group, Inc. Class A (a)

2,107,041

19,721,904

Thrifts & Mortgage Finance - 0.2%

New York Community Bancorp, Inc. (e)

876,220

9,366,792

Washington Mutual, Inc.

574,300

58,004

 

9,424,796

TOTAL FINANCIALS

1,228,804,751

HEALTH CARE - 8.3%

Biotechnology - 0.6%

Amgen, Inc. (a)

567,622

30,049,909

Health Care Equipment & Supplies - 0.8%

Boston Scientific Corp. (a)

2,033,862

20,623,361

Covidien PLC

528,536

19,788,388

 

40,411,749

Common Stocks - continued

Shares

Value

HEALTH CARE - continued

Health Care Providers & Services - 0.3%

Brookdale Senior Living, Inc.

715,901

$ 6,972,876

Fresenius Medical Care AG & Co. KGaA

166,400

7,443,422

 

14,416,298

Pharmaceuticals - 6.6%

Abbott Laboratories

332,300

15,631,392

Bristol-Myers Squibb Co.

1,039,900

21,120,369

Johnson & Johnson

1,000,829

56,847,087

Merck & Co., Inc.

1,451,900

40,595,124

Pfizer, Inc.

5,488,400

82,326,000

Schering-Plough Corp.

1,387,136

34,844,856

Wyeth

1,900,900

86,281,851

 

337,646,679

TOTAL HEALTH CARE

422,524,635

INDUSTRIALS - 8.4%

Aerospace & Defense - 2.6%

General Dynamics Corp.

168,700

9,344,293

Honeywell International, Inc.

1,533,125

48,140,125

Spirit AeroSystems Holdings, Inc. Class A (a)

769,882

10,578,179

The Boeing Co.

511,684

21,746,570

United Technologies Corp.

799,040

41,518,118

 

131,327,285

Building Products - 0.2%

Masco Corp.

1,269,200

12,158,936

Commercial Services & Supplies - 0.3%

Avery Dennison Corp.

367,602

9,440,019

Republic Services, Inc.

202,739

4,948,859

 

14,388,878

Electrical Equipment - 0.1%

Cooper Industries Ltd. Class A

135,100

4,194,855

Rockwell Automation, Inc.

101,300

3,253,756

 

7,448,611

Industrial Conglomerates - 2.6%

General Electric Co.

4,344,277

50,914,926

Rheinmetall AG

292,133

12,641,558

Siemens AG sponsored ADR

532,200

36,822,918

Textron, Inc.

1,337,600

12,921,216

Tyco International Ltd.

601,736

15,633,101

 

128,933,719

Machinery - 2.1%

Briggs & Stratton Corp.

1,046,088

13,954,814

Caterpillar, Inc.

101,800

3,363,472

Cummins, Inc.

417,900

14,714,259

Danaher Corp.

299,400

18,484,956

Eaton Corp.

384,500

17,152,545

Illinois Tool Works, Inc.

294,800

11,007,832

Ingersoll-Rand Co. Ltd. Class A

582,088

12,165,639

 

Shares

Value

Kennametal, Inc.

438,691

$ 8,414,093

Vallourec SA (e)

41,500

5,037,089

 

104,294,699

Road & Rail - 0.5%

Burlington Northern Santa Fe Corp.

89,300

6,567,122

CSX Corp.

135,100

4,678,513

Union Pacific Corp.

266,500

13,873,990

 

25,119,625

TOTAL INDUSTRIALS

423,671,753

INFORMATION TECHNOLOGY - 8.6%

Communications Equipment - 1.1%

Cisco Systems, Inc. (a)

2,201,080

41,028,131

Motorola, Inc.

2,139,412

14,184,302

 

55,212,433

Computers & Peripherals - 1.5%

Dell, Inc. (a)

500,700

6,874,611

Hewlett-Packard Co.

1,224,965

47,344,897

International Business Machines Corp.

204,300

21,333,006

 

75,552,514

Electronic Equipment & Components - 1.2%

Arrow Electronics, Inc. (a)

833,400

17,701,416

Avnet, Inc. (a)

1,038,554

21,840,791

Tyco Electronics Ltd.

1,197,936

22,269,630

 

61,811,837

IT Services - 0.1%

MoneyGram International, Inc. (a)

895,100

1,593,278

The Western Union Co.

294,281

4,826,208

 

6,419,486

Office Electronics - 0.1%

Xerox Corp.

1,034,035

6,700,547

Semiconductors & Semiconductor Equipment - 3.3%

Analog Devices, Inc.

863,800

21,404,964

Applied Materials, Inc.

2,099,600

23,032,612

Atmel Corp. (a)

766,800

2,860,164

Intel Corp.

3,503,400

57,981,270

Micron Technology, Inc. (a)

1,507,800

7,629,468

National Semiconductor Corp.

1,714,847

21,521,330

Novellus Systems, Inc. (a)

721,139

12,043,021

Teradyne, Inc. (a)

1,659,200

11,382,112

Varian Semiconductor Equipment Associates, Inc. (a)

296,000

7,101,040

 

164,955,981

Software - 1.3%

Microsoft Corp.

1,468,560

34,907,671

Oracle Corp.

843,108

18,059,373

Symantec Corp. (a)

619,233

9,635,265

 

62,602,309

TOTAL INFORMATION TECHNOLOGY

433,255,107

Common Stocks - continued

Shares

Value

MATERIALS - 1.6%

Chemicals - 0.9%

Celanese Corp. Class A

409,200

$ 9,718,500

Dow Chemical Co.

432,700

6,983,778

E.I. du Pont de Nemours & Co.

786,800

20,157,816

H.B. Fuller Co.

384,613

7,219,186

 

44,079,280

Metals & Mining - 0.7%

Alcoa, Inc.

1,241,171

12,821,296

Commercial Metals Co.

473,355

7,587,881

Freeport-McMoRan Copper & Gold, Inc. Class B

84,300

4,224,273

Nucor Corp.

250,800

11,143,044

 

35,776,494

TOTAL MATERIALS

79,855,774

TELECOMMUNICATION SERVICES - 6.6%

Diversified Telecommunication Services - 5.9%

AT&T, Inc.

7,071,669

175,660,258

Qwest Communications International, Inc.

7,838,900

32,531,435

Verizon Communications, Inc.

2,949,102

90,625,904

 

298,817,597

Wireless Telecommunication Services - 0.7%

Sprint Nextel Corp. (a)

3,678,878

17,695,403

Vodafone Group PLC sponsored ADR

879,087

17,133,406

 

34,828,809

TOTAL TELECOMMUNICATION SERVICES

333,646,406

UTILITIES - 3.6%

Electric Utilities - 1.8%

Allegheny Energy, Inc.

1,060,904

27,212,188

Entergy Corp.

383,159

29,702,486

Exelon Corp.

590,400

30,234,384

Southern Co.

50,700

1,579,812

 

88,728,870

Independent Power Producers & Energy Traders - 0.5%

AES Corp.

2,329,758

27,048,490

Multi-Utilities - 1.3%

Public Service Enterprise Group, Inc.

1,266,300

41,319,369

Wisconsin Energy Corp.

634,600

25,834,566

 

67,153,935

TOTAL UTILITIES

182,931,295

TOTAL COMMON STOCKS

(Cost $5,680,381,342)

4,824,688,087

Convertible Preferred Stocks - 1.8%

Shares

Value

CONSUMER DISCRETIONARY - 0.0%

Automobiles - 0.0%

General Motors Corp. Series C, 6.25%

471,200

$ 1,333,496

FINANCIALS - 0.9%

Capital Markets - 0.3%

Legg Mason, Inc. 7.00%

542,900

13,639,820

Commercial Banks - 0.2%

Huntington Bancshares, Inc. 8.50%

9,000

6,534,000

Wells Fargo & Co. 7.50%

2,990

2,347,060

 

8,881,060

Diversified Financial Services - 0.3%

CIT Group, Inc. Series C, 8.75%

81,800

1,410,814

Citigroup, Inc. Series T, 6.50%

384,449

12,903,070

 

14,313,884

Insurance - 0.1%

American International Group, Inc. Series A, 8.50%

469,454

4,469,202

Assured Guaranty Ltd. 8.50% (a)

67,700

3,689,650

 

8,158,852

TOTAL FINANCIALS

44,993,616

HEALTH CARE - 0.4%

Pharmaceuticals - 0.4%

Schering-Plough Corp. 6.00%

93,000

21,090,540

MATERIALS - 0.5%

Chemicals - 0.1%

Celanese Corp. 4.25%

111,200

3,493,904

Metals & Mining - 0.4%

Freeport-McMoRan Copper & Gold, Inc. 6.75%

232,700

18,383,300

TOTAL MATERIALS

21,877,204

TOTAL CONVERTIBLE PREFERRED STOCKS

(Cost $150,831,173)

89,294,856

Corporate Bonds - 1.8%

 

Principal Amount

 

Convertible Bonds - 1.7%

CONSUMER DISCRETIONARY - 0.9%

Auto Components - 0.1%

Johnson Controls, Inc. 6.5% 9/30/12

$ 3,460,000

6,980,833

Diversified Consumer Services - 0.0%

Ingersoll-Rand Global Holding Co. Ltd. 4.5% 4/15/12

1,270,000

1,703,070

Household Durables - 0.1%

Newell Rubbermaid, Inc. 5.5% 3/15/14

1,460,000

2,060,994

Corporate Bonds - continued

 

Principal Amount

Value

Convertible Bonds - continued

CONSUMER DISCRETIONARY - continued

Media - 0.7%

Liberty Media Corp.:

3.5% 1/15/31

$ 257,246

$ 138,836

4% 11/15/29 (f)

4,750,000

1,425,000

3.5% 1/15/31 (f)

9,412,957

5,080,192

News America, Inc. liquid yield option note:

0% 2/28/21 (f)

22,670,000

14,055,400

0% 2/28/21

3,490,000

2,163,800

Virgin Media, Inc. 6.5% 11/15/16 (f)

15,354,000

11,993,009

 

34,856,237

TOTAL CONSUMER DISCRETIONARY

45,601,134

FINANCIALS - 0.1%

Thrifts & Mortgage Finance - 0.1%

MGIC Investment Corp. 9% 4/1/63 (d)(f)

10,438,000

4,331,770

INDUSTRIALS - 0.1%

Airlines - 0.1%

UAL Corp.:

4.5% 6/30/21 (f)

8,490,000

2,759,250

4.5% 6/30/21

280,000

91,000

 

2,850,250

Industrial Conglomerates - 0.0%

Textron, Inc. 4.5% 5/1/13

1,920,000

1,926,336

Road & Rail - 0.0%

Hertz Global Holdings, Inc. 5.25% 6/1/14

1,350,000

1,530,459

TOTAL INDUSTRIALS

6,307,045

INFORMATION TECHNOLOGY - 0.3%

Semiconductors & Semiconductor Equipment - 0.3%

Advanced Micro Devices, Inc.:

6% 5/1/15 (f)

14,340,000

6,722,592

6% 5/1/15

4,780,000

2,240,864

Micron Technology, Inc.:

1.875% 6/1/14

2,570,000

1,507,331

4.25% 10/15/13

1,870,000

2,204,263

 

12,675,050

 

 

Principal Amount

Value

MATERIALS - 0.3%

Metals & Mining - 0.3%

Alcoa, Inc. 5.25% 3/15/14

$ 3,240,000

$ 5,690,250

ArcelorMittal SA 5% 5/15/14

2,670,000

3,378,084

United States Steel Corp. 4% 5/15/14

4,470,000

5,850,113

 

14,918,447

TOTAL CONVERTIBLE BONDS

83,833,446

Nonconvertible Bonds - 0.1%

MATERIALS - 0.1%

Chemicals - 0.1%

Hercules, Inc. 6.5% 6/30/29 unit

15,700,000

7,386,850

TOTAL CORPORATE BONDS

(Cost $115,958,467)

91,220,296

Money Market Funds - 1.5%

Shares

 

Fidelity Cash Central Fund, 0.40% (b)

42,368,159

42,368,159

Fidelity Securities Lending Cash Central Fund, 0.22% (b)(c)

31,829,460

31,829,460

TOTAL MONEY MARKET FUNDS

(Cost $74,197,619)

74,197,619

TOTAL INVESTMENT PORTFOLIO - 100.5%

(Cost $6,021,368,601)

5,079,400,858

NET OTHER ASSETS - (0.5)%

(24,305,997)

NET ASSETS - 100%

$ 5,055,094,861

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 unaudited listing of the fund's holdings as of its most recent quarter end is available upon request.

(c) Investment made with cash collateral received from securities on loan.

(d) Non-income producing - Issuer is in default.

(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 end of the period, the value of these securities amounted to $49,976,213 or 1.0% of net assets.

Affiliated Central Funds

Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:

Fund

Income earned

Fidelity Cash Central Fund

$ 74,563

Fidelity Securities Lending Cash Central Fund

1,563,689

Total

$ 1,638,252

Other Information

The following is a summary of the inputs used, as of June 30, 2009, involving the Fund's assets and liabilities carried at value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the tables below, please refer to the Security Valuation section in the accompanying Notes to Financial Statements.

Valuation Inputs at Reporting Date:

Description

Total

Level 1

Level 2

Level 3

Investments in Securities:

Equities:

Consumer Discretionary

$ 639,328,013

$ 623,201,557

$ 16,126,456

$ -

Consumer Staples

308,876,236

308,876,236

-

-

Energy

773,127,613

773,127,613

-

-

Financials

1,273,798,367

1,234,083,296

39,715,071

-

Health Care

443,615,175

422,524,635

21,090,540

-

Industrials

423,671,753

423,671,753

-

-

Information Technology

433,255,107

433,255,107

-

-

Materials

101,732,978

79,855,774

21,877,204

-

Telecommunication Services

333,646,406

333,646,406

-

-

Utilities

182,931,295

182,931,295

-

-

Corporate Bonds

91,220,296

-

91,220,296

-

Money Market Funds

74,197,619

74,197,619

-

-

Total Investments in Securities

$ 5,079,400,858

$ 4,889,371,291

$ 190,029,567

$ -

The following is a reconciliation of assets or liabilities for which level 3 inputs were used in determining value:

 

Investments in Securities

 

Beginning Balance

$ 11,592,000

Total Realized Gain (Loss)

-

Total Unrealized Gain (Loss)

3,200,960

Cost of Purchases

-

Proceeds of Sales

-

Amortization/Accretion

-

Transfers in/out of Level 3

(14,792,960)

Ending Balance

$ -

Total unrealized gain (loss) on investments held at June 30, 2009

$ -

The information used in the above reconciliation represents fiscal year to date activity for any Investment Securities identified as using Level 3 inputs at either the beginning or the end of the current fiscal period. Transfers in or out of Level 3 represents either the beginning value (for transfers in), or the ending value (for transfers out) of any Security or Instrument where a change in the pricing level occurred from the beginning to the end of the period.

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

United States of America

89.2%

Switzerland

3.3%

United Kingdom

1.7%

Bermuda

1.4%

Germany

1.2%

Netherlands Antilles

1.0%

Others (individually less than 1%)

2.2%

 

100.0%

Income Tax Information

At December 31, 2008, the fund had a capital loss carryforward of approximately $237,582,450 all of which will expire on December 31, 2016.

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

Semiannual Report

Financial Statements

Statement of Assets and Liabilities

 

June 30, 2009 (Unaudited)

Assets

Investment in securities, at value (including securities loaned of $29,842,792) - See accompanying schedule:

Unaffiliated issuers (cost $5,947,170,982)

$ 5,005,203,239

 

Fidelity Central Funds (cost $74,197,619)

74,197,619

 

Total Investments (cost $6,021,368,601)

 

$ 5,079,400,858

Cash

255,125

Receivable for investments sold

18,621,859

Receivable for fund shares sold

860,156

Dividends receivable

6,795,786

Interest receivable

722,709

Distributions receivable from Fidelity Central Funds

375,691

Prepaid expenses

32,190

Other receivables

198,228

Total assets

5,107,262,602

 

 

 

Liabilities

Payable for investments purchased

$ 12,226,081

Payable for fund shares redeemed

5,029,284

Accrued management fee

1,985,416

Distribution fees payable

315,180

Other affiliated payables

397,187

Other payables and accrued expenses

385,133

Collateral on securities loaned, at value

31,829,460

Total liabilities

52,167,741

 

 

 

Net Assets

$ 5,055,094,861

Net Assets consist of:

 

Paid in capital

$ 6,583,142,870

Undistributed net investment income

64,105,569

Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions

(650,184,816)

Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies

(941,968,762)

Net Assets

$ 5,055,094,861

Statement of Assets and Liabilities - continued

 

June 30, 2009 (Unaudited)

 

 

 

Initial Class:
Net Asset Value, offering price and redemption price per share ($3,218,005,930 ÷ 233,302,594 shares)

$ 13.79

 

 

 

Service Class:
Net Asset Value, offering price and redemption price per share ($377,726,495 ÷ 27,482,177 shares)

$ 13.74

 

 

 

Service Class 2:
Net Asset Value, offering price and redemption price per share ($1,334,877,360 ÷ 98,225,665 shares)

$ 13.59

 

 

 

Service Class 2R:
Net Asset Value, offering price and redemption price per share ($4,735,718 ÷ 350,205 shares)

$ 13.52

 

 

 

Investor Class:
Net Asset Value, offering price and redemption price per share ($119,749,358 ÷ 8,704,093 shares)

$ 13.76

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

Semiannual Report

Statement of Operations

Six months ended June 30, 2009 (Unaudited)

 

 

 

Investment Income

 

 

Dividends

 

$ 78,684,418

Interest

 

3,388,742

Income from Fidelity Central Funds

 

1,638,252

Total income

 

83,711,412

 

 

 

Expenses

Management fee

$ 10,913,211

Transfer agent fees

2,075,983

Distribution fees

1,715,578

Accounting and security lending fees

600,525

Custodian fees and expenses

40,363

Independent trustees' compensation

18,967

Appreciation in deferred trustee compensation account

72

Audit

40,248

Legal

5,402

Interest

3,700

Miscellaneous

218,452

Total expenses before reductions

15,632,501

Expense reductions

(6,169)

15,626,332

Net investment income (loss)

68,085,080

Realized and Unrealized Gain (Loss)

Net realized gain (loss) on:

Investment securities:

 

 

Unaffiliated issuers

(353,043,252)

Foreign currency transactions

(91,438)

Total net realized gain (loss)

 

(353,134,690)

Change in net unrealized appreciation (depreciation) on:

Investment securities

481,302,553

Assets and liabilities in foreign currencies

1,582

Total change in net unrealized appreciation (depreciation)

 

481,304,135

Net gain (loss)

128,169,445

Net increase (decrease) in net assets resulting from operations

$ 196,254,525

Statement of Changes in Net Assets

 

Six months ended
June 30, 2009
(Unaudited)

Year ended
December 31,
2008

Increase (Decrease) in Net Assets

 

 

Operations

 

 

Net investment income (loss)

$ 68,085,080

$ 188,293,003

Net realized gain (loss)

(353,134,690)

(284,674,239)

Change in net unrealized appreciation (depreciation)

481,304,135

(4,122,622,475)

Net increase (decrease) in net assets resulting from operations

196,254,525

(4,219,003,711)

Distributions to shareholders from net investment income

(6,586,996)

(186,575,269)

Distributions to shareholders from net realized gain

-

(8,976,342)

Total distributions

(6,586,996)

(195,551,611)

Share transactions - net increase (decrease)

(311,845,780)

(1,357,103,153)

Redemption fees

269

1,769

Total increase (decrease) in net assets

(122,177,982)

(5,771,656,706)

 

 

 

Net Assets

Beginning of period

5,177,272,843

10,948,929,549

End of period (including undistributed net investment income of $64,105,569 and undistributed net investment income of $2,607,485, respectively)

$ 5,055,094,861

$ 5,177,272,843

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

Semiannual Report

Financial Highlights - Initial Class

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 13.18

$ 23.91

$ 26.20

$ 25.49

$ 25.37

$ 23.18

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .18

.47

.47

.45

.42

.40

Net realized and unrealized gain (loss)

  .45

(10.67)

(.05) H

4.37

1.00

2.24

Total from investment operations

  .63

(10.20)

.42

4.82

1.42

2.64

Distributions from net investment income

  (.02)

(.51)

(.50)

(.89)

(.41)

(.36)

Distributions from net realized gain

  -

(.02)

(2.21)

(3.22)

(.89)

(.09)

Total distributions

  (.02)

(.53)

(2.71)

(4.11)

(1.30)

(.45)

Redemption fees added to paid in capital E, J

  -

-

-

-

-

-

Net asset value, end of period

$ 13.79

$ 13.18

$ 23.91

$ 26.20

$ 25.49

$ 25.37

Total Return B, C, D

  4.78%

(42.65)%

1.53%

20.19%

5.87%

11.53%

Ratios to Average Net Assets F, I

 

 

 

 

 

 

Expenses before reductions

  .59% A

.57%

.55%

.57%

.56%

.58%

Expenses net of fee waivers, if any

  .59% A

.57%

.55%

.57%

.56%

.58%

Expenses net of all reductions

  .59% A

.57%

.54%

.56%

.55%

.57%

Net investment income (loss)

  2.98% A

2.37%

1.71%

1.76%

1.71%

1.71%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 3,218,006

$ 3,322,799

$ 7,201,655

$ 8,315,159

$ 7,875,801

$ 8,689,829

Portfolio turnover rate G

  26% A

34%

20%

22%

19%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund. I 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 fee 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. J Amount represents less than $.01 per share.

Financial Highlights - Service Class

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 13.14

$ 23.82

$ 26.11

$ 25.39

$ 25.28

$ 23.11

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .18

.44

.44

.43

.39

.38

Net realized and unrealized gain (loss)

  .44

(10.62)

(.05) H

4.35

1.00

2.22

Total from investment operations

  .62

(10.18)

.39

4.78

1.39

2.60

Distributions from net investment income

  (.02)

(.48)

(.47)

(.84)

(.39)

(.34)

Distributions from net realized gain

  -

(.02)

(2.21)

(3.22)

(.89)

(.09)

Total distributions

  (.02)

(.50)

(2.68)

(4.06)

(1.28)

(.43)

Redemption fees added to paid in capital E, J

  -

-

-

-

-

-

Net asset value, end of period

$ 13.74

$ 13.14

$ 23.82

$ 26.11

$ 25.39

$ 25.28

Total Return B, C, D

  4.72%

(42.70)%

1.42%

20.08%

5.76%

11.38%

Ratios to Average Net Assets F, I

 

 

 

 

 

 

Expenses before reductions

  .69% A

.67%

.65%

.67%

.66%

.68%

Expenses net of fee waivers, if any

  .69% A

.67%

.65%

.67%

.66%

.68%

Expenses net of all reductions

  .69% A

.67%

.64%

.66%

.65%

.67%

Net investment income (loss)

  2.88% A

2.27%

1.61%

1.66%

1.61%

1.61%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 377,726

$ 405,082

$ 920,054

$ 1,118,333

$ 1,079,838

$ 1,170,778

Portfolio turnover rate G

  26% A

34%

20%

22%

19%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund. I 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 fee 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. J Amount represents less than $.01 per share.

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

Semiannual Report

Financial Highlights - Service Class 2

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 13.00

$ 23.57

$ 25.87

$ 25.17

$ 25.09

$ 22.96

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .17

.41

.39

.38

.35

.34

Net realized and unrealized gain (loss)

  .44

(10.50)

(.04) H

4.32

.98

2.21

Total from investment operations

  .61

(10.09)

.35

4.70

1.33

2.55

Distributions from net investment income

  (.02)

(.46)

(.44)

(.78)

(.36)

(.33)

Distributions from net realized gain

  -

(.02)

(2.21)

(3.22)

(.89)

(.09)

Total distributions

  (.02)

(.48)

(2.65)

(4.00)

(1.25)

(.42)

Redemption fees added to paid in capital E, J

  -

-

-

-

-

-

Net asset value, end of period

$ 13.59

$ 13.00

$ 23.57

$ 25.87

$ 25.17

$ 25.09

Total Return B, C, D

  4.69%

(42.81)%

1.27%

19.93%

5.57%

11.23%

Ratios to Average Net Assets F, I

 

 

 

 

 

 

Expenses before reductions

  .84% A

.82%

.80%

.82%

.81%

.83%

Expenses net of fee waivers, if any

  .84% A

.82%

.80%

.82%

.81%

.83%

Expenses net of all reductions

  .84% A

.82%

.80%

.82%

.80%

.82%

Net investment income (loss)

  2.73% A

2.12%

1.46%

1.51%

1.46%

1.46%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 1,334,877

$ 1,321,569

$ 2,583,129

$ 2,373,059

$ 1,723,546

$ 1,420,999

Portfolio turnover rate G

  26% A

34%

20%

22%

19%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund. I 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 fee 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. J Amount represents less than $.01 per share.

Financial Highlights - Service Class 2R

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 12.93

$ 23.44

$ 25.73

$ 25.08

$ 25.01

$ 22.91

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .17

.41

.39

.38

.35

.34

Net realized and unrealized gain (loss)

  .44

(10.45)

(.04) H

4.29

.99

2.20

Total from investment operations

  .61

(10.04)

.35

4.67

1.34

2.54

Distributions from net investment income

  (.02)

(.45)

(.43)

(.80)

(.38)

(.35)

Distributions from net realized gain

  -

(.02)

(2.21)

(3.22)

(.89)

(.09)

Total distributions

  (.02)

(.47)

(2.64)

(4.02)

(1.27)

(.44)

Redemption fees added to paid in capital E, J

  -

-

-

-

-

-

Net asset value, end of period

$ 13.52

$ 12.93

$ 23.44

$ 25.73

$ 25.08

$ 25.01

Total Return B, C, D

  4.72%

(42.82)%

1.27%

19.89%

5.61%

11.22%

Ratios to Average Net Assets F, I

 

 

 

 

 

 

Expenses before reductions

  .84% A

.82%

.80%

.82%

.81%

.83%

Expenses net of fee waivers, if any

  .84% A

.82%

.80%

.82%

.81%

.83%

Expenses net of all reductions

  .84% A

.81%

.79%

.81%

.80%

.82%

Net investment income (loss)

  2.73% A

2.12%

1.46%

1.51%

1.46%

1.46%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 4,736

$ 5,339

$ 13,558

$ 17,089

$ 9,651

$ 5,617

Portfolio turnover rate G

  26% A

34%

20%

22%

19%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund. I 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 fee 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. J Amount represents less than $.01 per share.

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

Semiannual Report

Financial Highlights - Investor Class

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005 I

Selected Per-Share Data

 

 

 

 

 

Net asset value, beginning of period

$ 13.15

$ 23.85

$ 26.15

$ 25.48

$ 24.46

Income from Investment Operations

 

 

 

 

 

Net investment income (loss) E

  .18

.44

.44

.42

.17

Net realized and unrealized gain (loss)

  .45

(10.63)

(.05) H

4.36

.85

Total from investment operations

  .63

(10.19)

.39

4.78

1.02

Distributions from net investment income

  (.02)

(.49)

(.48)

(.89)

-

Distributions from net realized gain

  -

(.02)

(2.21)

(3.22)

-

Total distributions

  (.02)

(.51)

(2.69)

(4.11)

-

Redemption fees added to paid in capital E, K

  -

-

-

-

-

Net asset value, end of period

$ 13.76

$ 13.15

$ 23.85

$ 26.15

$ 25.48

Total Return B, C, D

  4.79%

(42.71)%

1.39%

20.04%

4.17%

Ratios to Average Net Assets F, J

 

 

 

 

 

Expenses before reductions

  .70% A

.66%

.66%

.69%

.74% A

Expenses net of fee waivers, if any

  .70% A

.66%

.66%

.69%

.74% A

Expenses net of all reductions

  .70% A

.66%

.66%

.69%

.73% A

Net investment income (loss)

  2.87% A

2.28%

1.60%

1.63%

1.54% A

Supplemental Data

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 119,749

$ 122,483

$ 230,534

$ 170,050

$ 37,500

Portfolio turnover rate G

  26% A

34%

20%

22%

19%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund. I For the period July 21, 2005 (commencement of sale of shares) to December 31, 2005. J 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 fee 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. K Amount represents less than $.01 per share.

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

Semiannual Report

Notes to Financial Statements

For the period ended June 30, 2009 (Unaudited)

1. Organization.

VIP Equity-Income Portfolio (the Fund) is a fund of Variable Insurance Products Fund (the trust) and is authorized to issue an unlimited number of shares. The trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. Shares of the Fund may only be purchased by insurance companies for the purpose of funding variable annuity or variable life insurance contracts. The Fund offers the following classes of shares: Initial Class shares, Service Class shares, Service Class 2 shares, Service Class 2R shares and Investor Class 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 transfer agent and distribution and service plan fees incurred. Certain expense reductions also differ by class.

2. Investments in Fidelity Central Funds.

The Fund may invest in Fidelity Central Funds, which are open-end investment companies available only to other investment companies and accounts managed by Fidelity Management & Research Company (FMR) and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.

The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of FMR.

A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the SEC's web site at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC's web site or upon request.

3. Significant Accounting Policies.

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. Actual results could differ from those estimates. Events or transactions occurring after period end through the date that the financial statements were issued, August 10, 2009, have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:

Security Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Fund uses independent pricing services approved by the Board of Trustees to value its investments. Generally Accepted Accounting Principles (GAAP) establishes a disclosure hierarchy that categorizes the inputs to valuation techniques used to value assets and liabilities at measurement date. These inputs are classified into three levels. Level 1 includes readily available unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 includes observable inputs other than quoted prices included in Level 1 that are observable either directly or indirectly. Level 3 includes unobservable inputs when market prices are not readily available or reliable. Changes in valuation techniques may result in transfers in or out of an investment's assigned level within the hierarchy. The aggregate value by input level, as of June 30, 2009, for the Fund's investments is included at the end of the Fund's Schedule of Investments. Valuation techniques of the Fund's major categories of assets and liabilities as presented in the Schedule of Investments are as follows.

Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by an independent pricing service on the primary market or exchange on which they are traded. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price. Debt securities, including restricted securities, are valued based on quotations received from dealers who make markets in such securities or by independent pricing services. For corporate bonds, pricing services generally utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type as well as dealer supplied prices. Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value each business day. Short-term securities with remaining maturities of sixty days or less for which quotations are not readily available are valued at amortized cost, which approximates value.

When current market prices or quotations are not readily available or reliable, valuations may be determined in good faith in accordance with procedures adopted by the Board of Trustees. Factors used in determining value may include significant market or security specific events, changes in interest rates and credit quality, and developments in foreign markets which are monitored by evaluating the performance of ADRs, futures contracts and exchange-traded funds. The frequency with which these procedures are used cannot be predicted and may be utilized to a significant extent. The value of securities used for net asset value (NAV) calculation under these procedures may differ from published prices for the same securities.

Foreign Currency. The Fund uses 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.

Semiannual Report

Notes to Financial Statements (Unaudited) - continued

3. Significant Accounting Policies - continued

Foreign Currency - continued

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. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. 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 Fund is 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 Fund estimates the components of distributions received that may be considered return of capital distributions or capital gain distributions. Interest income and distributions from the Fidelity Central Funds are accrued as earned. Interest income includes coupon interest and amortization of premium and accretion of discount on debt securities. 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 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 collectability of interest is reasonably assured.

Expenses. Most expenses of the trust can be directly attributed to a fund. Expenses which cannot be directly attributed are apportioned among each fund in the trust. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.

Deferred Trustee Compensation. Under a Deferred Compensation Plan (the Plan), independent 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 invested in a cross-section of Fidelity funds, are marked-to-market and remain in the Fund until distributed in accordance with the Plan. The investment of deferred amounts and the offsetting payable to the Trustees are included in the accompanying Statement of Assets and Liabilities.

Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company by distributing substantially all of its taxable income and realized gains under Subchapter M of the Internal Revenue Code and filing its U.S. federal tax return. As a result, no provision for income taxes is required. The Fund is subject to the provisions of FASB Interpretation No. 48, Accounting for Uncertainties in Income Taxes (FIN 48). FIN 48 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. There are no unrecognized tax benefits in the accompanying financial statements. A Fund's federal tax return is subject to examination by the Internal Revenue Service (IRS) for a period of three years. Foreign taxes are provided for based on the 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 foreign currency transactions, passive foreign investment companies (PFIC), market discount, partnerships, deferred trustees compensation, capital loss carryforwards and losses deferred due to wash sales.

The federal tax cost of investments and unrealized appreciation (depreciation) as of period end were as follows:

Unrealized appreciation

$ 812,540,158

Unrealized depreciation

(1,782,938,160)

Net unrealized appreciation (depreciation)

$ (970,398,002)

Cost for federal income tax purposes

$ 6,049,798,860

Trading (Redemption) Fees. Service Class 2 R 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 Fund and accounted for as an addition to paid in capital.

Semiannual Report

4. Operating Policies.

Restricted Securities. The Fund 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 the Fund's Schedule of Investments.

5. Purchases and Sales of Investments.

Purchases and sales of securities, other than short-term securities, aggregated $605,164,798 and $884,167,993, respectively.

6. Fees and Other Transactions with Affiliates.

Management Fee. FMR and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .20% of the Fund's average net assets and a group fee rate that averaged .27% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by FMR. The group fee rate decreases as assets under management increase and increases as assets under management decrease. For the period, the total annualized management fee rate was .47% of the Fund's average net assets.

Distribution and Service Plan. In accordance with Rule 12b-1 of the 1940 Act, the Fund has 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 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

$ 178,119

Service Class 2

1,531,820

Service Class 2R

5,639

 

$ 1,715,578

Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc. (FIIOC), an affiliate of FMR, is the Fund's transfer, dividend disbursing, and shareholder servicing agent. FIIOC receives an asset-based fee with respect to each class. Each class (with the exception of Investor Class) pays a transfer agent fee, excluding out of pocket expenses, equal to an annual rate of .07% of average net assets. Investor Class pays a monthly asset-based transfer agent fee of .15% of average net assets. The total transfer agent fees paid by each class to FIIOC, including out of pocket expenses, were as follows:

Initial Class

$ 1,285,942

Service Class

153,021

Service Class 2

526,187

Service Class 2R

1,920

Investor Class

108,913

 

$ 2,075,983

Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of FMR, maintains the 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.

Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. The commissions paid to these affiliated firms were $14,883 for the period.

Interfund Lending Program. Pursuant to an Exemptive Order issued by the Securities and Exchange Commission (the SEC), the Fund, 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 affiliated funds. At period end, there were no interfund loans outstanding. The Fund's activity in this program during the period for which loans were outstanding was as follows:

Borrower or Lender

Average Daily Loan
Balance

Weighted Average
Interest Rate

Interest
Expense

Borrower

$ 8,332,324

.43%

$ 3,700

Semiannual Report

Notes to Financial Statements (Unaudited) - continued

7. Committed Line of Credit.

The Fund participates with other funds managed by FMR in a $3.5 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 Fund has agreed to pay commitment fees on its pro-rata portion of the line of credit, which amounted to $15,104 and is reflected in Miscellaneous Expense on the Statement of Operations. During the period, there were no borrowings on this line of credit.

8. Security Lending.

The Fund lends portfolio securities from time to time in order to earn additional income. On the settlement date of the loan, the 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 Fund and any additional required collateral is delivered to the Fund 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. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. Security lending income represents the income earned on investing cash collateral, less fees and expenses associated with the loan, plus any premium payments that may be received on the loan of certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds. Net income from lending portfolio securities during the period amounted to $1,563,689.

9. Expense Reductions.

Many of the brokers with whom FMR places trades on behalf of the Fund provided services to the Fund in addition to trade execution. These services included payments of certain expenses on behalf of the Fund totaling $6,169 for the period.

10. Distributions to Shareholders.

Distributions to shareholders of each class were as follows:

Six months ended
June 30,
2009

Year ended
December 31,
2008

From net investment income

 

 

Initial Class

$ 4,193,590

$ 123,156,013

Service Class

508,338

14,421,360

Service Class 2

1,722,825

44,390,804

Service Class 2R

6,680

178,863

Investor Class

155,563

4,428,229

Total

$ 6,586,996

$ 186,575,269

From net realized gain

 

 

Initial Class

$ -

$ 5,874,187

Service Class

-

748,441

Service Class 2

-

2,153,837

Service Class 2R

-

10,338

Investor Class

-

189,539

Total

$ -

$ 8,976,342

Semiannual Report

11. Share Transactions.

Transactions for each class of shares were as follows:

 

Shares

Dollars

Six months ended
June 30,
2009

Year ended
December 31,
2008

Six months ended
June 30,
2009

Year ended
December 31,
2008

Initial Class

 

 

 

 

Shares sold

5,733,572

7,761,257

$ 71,432,365

$ 147,326,576

Reinvestment of distributions

360,274

9,853,413

4,193,590

129,030,200

Shares redeemed

(24,959,443)

(66,674,318)

(300,587,458)

(1,304,182,592)

Net increase (decrease)

(18,865,597)

(49,059,648)

$ (224,961,503)

$ (1,027,825,816)

Service Class

 

 

 

 

Shares sold

940,973

1,403,882

$ 11,786,691

$ 26,376,852

Reinvestment of distributions

43,822

1,160,264

508,338

15,169,801

Shares redeemed

(4,338,089)

(10,352,999)

(52,042,407)

(200,182,896)

Net increase (decrease)

(3,353,294)

(7,788,853)

$ (39,747,378)

$ (158,636,243)

Service Class 2

 

 

 

 

Shares sold

6,668,545

12,836,633

$ 80,423,381

$ 239,743,721

Reinvestment of distributions

150,203

3,603,934

1,722,825

46,544,641

Shares redeemed

(10,258,793)

(24,390,530)

(121,683,243)

(445,540,000)

Net increase (decrease)

(3,440,045)

(7,949,963)

$ (39,537,037)

$ (159,251,638)

Service Class 2R

 

 

 

 

Shares sold

35,848

75,542

$ 464,584

$ 1,570,935

Reinvestment of distributions

585

14,668

6,680

189,201

Shares redeemed

(98,996)

(255,760)

(1,157,670)

(5,069,469)

Net increase (decrease)

(62,563)

(165,550)

$ (686,406)

$ (3,309,333)

Investor Class

 

 

 

 

Shares sold

576,511

1,599,925

$ 7,169,873

$ 30,095,055

Reinvestment of distributions

13,399

354,134

155,563

4,617,768

Shares redeemed

(1,199,811)

(2,304,633)

(14,238,892)

(42,792,946)

Net increase (decrease)

(609,901)

(350,574)

$ (6,913,456)

$ (8,080,123)

12. Other.

The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund's maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

At the end of the period, FMR or its affiliates were the owners of record of 11% of the total outstanding shares of the Fund, and two otherwise unaffiliated shareholders were the owners of record of 31% of the total outstanding shares of the Fund.

Semiannual Report

Investment Adviser

Fidelity Management & Research Company
Boston, MA

Investment Sub-Advisers

FMR Co., Inc.

Fidelity Management & Research (U.K.) Inc.

Fidelity Research & Analysis Company

Fidelity Investments Japan Limited

FIL Investment Advisors

FIL Investment Advisors (U.K.) Ltd.

Fidelity Management & Research (Hong Kong) Limited

Fidelity Management & Research (Japan) Inc.

General Distributor

Fidelity Distributors Corporation
Boston, MA

Transfer and Service Agents

Fidelity Investments Institutional Operations Company, Inc.
Boston, MA 

Fidelity Service Company, Inc.
Boston, MA 

Custodian

The Northern Trust Company
Chicago, IL 

VIPEI-SANN-0809
1.705693.111

Fidelity® Variable Insurance Products:
Equity-Income Portfolio - Service Class 2R

Semiannual Report

June 30, 2009

(2_fidelity_logos) (Registered_Trademark)

Contents

Shareholder Expense Example

<Click Here>

An example of shareholder expenses.

Investment Changes

<Click Here>

A summary of major shifts in the fund's investments over the past six months.

Investments

<Click Here>

A complete list of the fund's investments with their market values.

Financial Statements

<Click Here>

Statements of assets and liabilities, operations, and changes in net assets, as well as financial highlights.

Notes

<Click Here>

Notes to the financial statements.

To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov. You may also call 1-877-208-0098 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 LLC or an affiliated company.

This report and the financial statements contained herein are submitted for the general information of the shareholders of the fund. This report is not authorized for distribution to prospective investors in the fund 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 holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com, or http://www.advisor.fidelity.com, as applicable.

NOT FDIC INSURED · MAY LOSE VALUE · NO BANK GUARANTEE

Neither the fund nor Fidelity Distributors Corporation is a bank.

Semiannual Report

Shareholder Expense Example

As a shareholder of the 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 Fund 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 (January 1, 2009 to June 30, 2009).

Actual Expenses

The first line of the accompanying table for each class of the 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. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.

Hypothetical Example for Comparison Purposes

The second line of the accompanying table for each class of the 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. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.

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.

 



Annualized
Expense Ratio


Beginning
Account Value
January 1, 2009


Ending
Account Value
June 30, 2009

Expenses Paid
During Period*
January 1, 2009
to June 30, 2009

Initial Class

.59%

 

 

 

Actual

 

$ 1,000.00

$ 1,047.80

$ 3.00

Hypothetical A

 

$ 1,000.00

$ 1,021.87

$ 2.96

Service Class

.69%

 

 

 

Actual

 

$ 1,000.00

$ 1,047.20

$ 3.50

Hypothetical A

 

$ 1,000.00

$ 1,021.37

$ 3.46

Service Class 2

.84%

 

 

 

Actual

 

$ 1,000.00

$ 1,046.90

$ 4.26

Hypothetical A

 

$ 1,000.00

$ 1,020.63

$ 4.21

Service Class 2R

.84%

 

 

 

Actual

 

$ 1,000.00

$ 1,047.20

$ 4.26

Hypothetical A

 

$ 1,000.00

$ 1,020.63

$ 4.21

Investor Class

.70%

 

 

 

Actual

 

$ 1,000.00

$ 1,047.90

$ 3.55

Hypothetical A

 

$ 1,000.00

$ 1,021.32

$ 3.51

A 5% return per year before expenses

* Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).

Semiannual Report

Investment Changes (Unaudited)

Top Ten Stocks as of June 30, 2009

 

% of fund's
net assets

% of fund's net assets
6 months ago

JPMorgan Chase & Co.

3.7

3.4

AT&T, Inc.

3.5

4.1

Exxon Mobil Corp.

3.4

4.9

Wells Fargo & Co.

3.3

3.2

Bank of America Corp.

3.0

2.5

Chevron Corp.

3.0

3.5

Verizon Communications, Inc.

1.8

2.1

Wyeth

1.7

1.2

Goldman Sachs Group, Inc.

1.7

0.6

ConocoPhillips

1.6

2.0

 

26.7

Top Five Market Sectors as of June 30, 2009

 

% of fund's
net assets

% of fund's net assets
6 months ago

Financials

25.3

23.0

Energy

15.3

18.3

Consumer Discretionary

13.5

12.2

Information Technology

8.9

8.2

Health Care

8.7

9.1

Asset Allocation (% of fund's net assets)

As of June 30, 2009*

As of December 31, 2008**

fid4705

Stocks 97.2%

 

fid4705

Stocks 98.5%

 

fid4708

Bonds 1.8%

 

fid4708

Bonds 1.2%

 

fid4711

Short-Term
Investments and
Net Other Assets 1.0%

 

fid4711

Short-Term
Investments and
Net Other Assets 0.3%

 

* Foreign investments

10.8%

 

** Foreign investments

10.6%

 


fid4727

Semiannual Report

Investments June 30, 2009 (Unaudited)

Showing Percentage of Net Assets

Common Stocks - 95.4%

Shares

Value

CONSUMER DISCRETIONARY - 12.6%

Auto Components - 1.4%

Gentex Corp.

561,936

$ 6,518,458

Johnson Controls, Inc.

1,490,110

32,365,189

Magna International, Inc. Class A

129,600

5,498,891

The Goodyear Tire & Rubber Co. (a)

2,247,200

25,303,472

 

69,686,010

Automobiles - 0.5%

Fiat SpA (a)

954,377

9,585,125

Ford Motor Co. (a)

676,891

4,108,728

Harley-Davidson, Inc. (e)

802,750

13,012,578

Winnebago Industries, Inc.

144,011

1,070,002

 

27,776,433

Diversified Consumer Services - 0.7%

H&R Block, Inc.

1,966,986

33,891,169

Hotels, Restaurants & Leisure - 0.6%

Las Vegas Sands Corp. unit

112,000

14,792,960

Starbucks Corp. (a)

1,335,700

18,552,873

 

33,345,833

Household Durables - 1.6%

Black & Decker Corp.

327,151

9,376,148

Centex Corp.

963,300

8,149,518

KB Home

178,100

2,436,408

Lennar Corp. Class A

340,500

3,299,445

Newell Rubbermaid, Inc.

1,699,520

17,692,003

Pulte Homes, Inc.

726,551

6,415,445

The Stanley Works

278,036

9,408,738

Whirlpool Corp.

549,334

23,379,655

 

80,157,360

Internet & Catalog Retail - 0.1%

Liberty Media Corp. Interactive Series A (a)

845,069

4,233,796

Leisure Equipment & Products - 0.1%

Brunswick Corp.

1,013,757

4,379,430

Media - 2.9%

Ascent Media Corp. (a)

45,847

1,218,613

Belo Corp. Series A

952,224

1,704,481

CC Media Holdings, Inc. Class A (a)

693,958

693,958

Comcast Corp. Class A

2,224,736

32,236,425

DreamWorks Animation SKG, Inc. Class A (a)

66,800

1,843,012

Informa PLC

1,802,640

6,494,693

Interpublic Group of Companies, Inc. (a)

1,137,000

5,741,850

Liberty Global, Inc. Class A (a)

503,612

8,002,395

Scripps Networks Interactive, Inc. Class A

192,886

5,368,017

The Walt Disney Co.

1,112,400

25,952,292

Time Warner, Inc.

1,567,983

39,497,492

Viacom, Inc. Class B (non-vtg.) (a)

445,400

10,110,580

Virgin Media, Inc.

906,431

8,475,130

 

147,338,938

 

Shares

Value

Multiline Retail - 1.9%

Kohl's Corp. (a)

1,043,953

$ 44,628,991

Macy's, Inc.

844,900

9,936,024

Target Corp.

993,700

39,221,339

Tuesday Morning Corp. (a)

445,123

1,500,065

 

95,286,419

Specialty Retail - 2.8%

Home Depot, Inc.

2,343,600

55,379,268

Lowe's Companies, Inc.

1,022,078

19,838,534

OfficeMax, Inc.

513,300

3,223,524

RadioShack Corp.

368,100

5,138,676

Staples, Inc.

1,795,345

36,212,109

Tiffany & Co., Inc.

572,345

14,514,669

Williams-Sonoma, Inc.

477,400

5,666,738

 

139,973,518

Textiles, Apparel & Luxury Goods - 0.0%

Liz Claiborne, Inc.

668,615

1,925,611

TOTAL CONSUMER DISCRETIONARY

637,994,517

CONSUMER STAPLES - 6.1%

Beverages - 1.3%

Carlsberg AS Series B

489,873

31,421,932

The Coca-Cola Co.

754,265

36,197,177

 

67,619,109

Food & Staples Retailing - 1.3%

CVS Caremark Corp.

606,005

19,313,379

Wal-Mart Stores, Inc.

628,463

30,442,748

Walgreen Co.

370,849

10,902,961

Winn-Dixie Stores, Inc. (a)

435,720

5,463,929

 

66,123,017

Food Products - 1.0%

Marine Harvest ASA (a)(e)

16,379,000

11,000,479

Nestle SA (Reg.)

632,826

23,835,825

Tyson Foods, Inc. Class A

1,240,027

15,636,740

 

50,473,044

Household Products - 1.2%

Kimberly-Clark Corp.

477,700

25,045,811

Procter & Gamble Co.

649,142

33,171,156

 

58,216,967

Personal Products - 0.4%

Avon Products, Inc.

873,658

22,522,903

Tobacco - 0.9%

Philip Morris International, Inc.

1,006,905

43,921,196

TOTAL CONSUMER STAPLES

308,876,236

ENERGY - 15.3%

Energy Equipment & Services - 2.7%

BJ Services Co.

400,724

5,461,868

Halliburton Co.

799,295

16,545,407

Nabors Industries Ltd. (a)

947,513

14,762,253

Common Stocks - continued

Shares

Value

ENERGY - continued

Energy Equipment & Services - continued

Noble Corp.

1,330,468

$ 40,246,657

Pride International, Inc. (a)

410,300

10,282,118

Schlumberger Ltd. (NY Shares)

917,657

49,654,420

 

136,952,723

Oil, Gas & Consumable Fuels - 12.6%

Anadarko Petroleum Corp.

183,500

8,329,065

Apache Corp.

380,380

27,444,417

Chevron Corp.

2,256,529

149,495,046

ConocoPhillips

1,969,810

82,850,209

CONSOL Energy, Inc.

226,690

7,698,392

Devon Energy Corp.

144,700

7,886,150

EOG Resources, Inc.

467,000

31,718,640

Exxon Mobil Corp.

2,440,330

170,603,470

Hess Corp.

90,700

4,875,125

Marathon Oil Corp.

606,800

18,282,884

Occidental Petroleum Corp.

693,009

45,606,922

Peabody Energy Corp.

222,361

6,706,408

Royal Dutch Shell PLC:

Class A sponsored ADR

1,009,300

50,656,767

Class B ADR

232,200

11,809,692

Williams Companies, Inc.

782,300

12,211,703

 

636,174,890

TOTAL ENERGY

773,127,613

FINANCIALS - 24.3%

Capital Markets - 6.0%

Bank of New York Mellon Corp.

2,412,295

70,704,366

Credit Suisse Group sponsored ADR

676,600

30,940,918

Goldman Sachs Group, Inc.

580,394

85,573,291

KKR Private Equity Investors, LP Restricted Depositary Units (a)(f)

601,500

3,609,000

Morgan Stanley

2,435,577

69,438,300

State Street Corp.

363,980

17,179,856

T. Rowe Price Group, Inc.

69,500

2,896,065

UBS AG:

(For. Reg.) (a)

657,300

8,071,717

(NY Shares) (a)

1,106,200

13,506,702

 

301,920,215

Commercial Banks - 6.4%

Associated Banc-Corp.

1,137,055

14,213,188

Comerica, Inc.

506,000

10,701,900

Huntington Bancshares, Inc.

609,700

2,548,546

KeyCorp

3,193,400

16,733,416

Mitsubishi UFJ Financial Group, Inc. sponsored ADR

3,542,625

21,751,718

PNC Financial Services Group, Inc.

1,322,730

51,335,151

Sterling Financial Corp., Washington (e)

732,527

2,131,654

SunTrust Banks, Inc.

418,400

6,882,680

 

Shares

Value

U.S. Bancorp, Delaware

1,660,138

$ 29,749,673

Wells Fargo & Co.

6,914,709

167,750,840

 

323,798,766

Consumer Finance - 1.1%

Capital One Financial Corp.

890,199

19,477,554

Discover Financial Services

2,519,369

25,873,920

Promise Co. Ltd.

332,700

4,258,256

SLM Corp. (a)

904,032

9,284,409

 

58,894,139

Diversified Financial Services - 7.0%

Bank of America Corp.

11,432,479

150,908,723

CIT Group, Inc.

1,322,497

2,843,369

Citigroup, Inc. (e)

2,080,703

6,179,688

CME Group, Inc.

16,146

5,023,182

JPMorgan Chase & Co.

5,487,812

187,189,263

 

352,144,225

Insurance - 2.6%

ACE Ltd.

674,496

29,832,958

Hartford Financial Services Group, Inc.

583,700

6,928,519

Lincoln National Corp.

337,500

5,808,375

MBIA, Inc. (a)

414,697

1,795,638

MetLife, Inc.

497,173

14,920,162

Montpelier Re Holdings Ltd.

1,088,000

14,459,520

PartnerRe Ltd.

332,524

21,597,434

The Travelers Companies, Inc.

720,596

29,573,260

XL Capital Ltd. Class A

560,002

6,417,623

 

131,333,489

Real Estate Investment Trusts - 0.6%

Annaly Capital Management, Inc.

606,500

9,182,410

Developers Diversified Realty Corp.

439,967

2,147,039

HCP, Inc.

575,400

12,192,726

Senior Housing Properties Trust (SBI)

492,956

8,045,042

 

31,567,217

Real Estate Management & Development - 0.4%

CB Richard Ellis Group, Inc. Class A (a)

2,107,041

19,721,904

Thrifts & Mortgage Finance - 0.2%

New York Community Bancorp, Inc. (e)

876,220

9,366,792

Washington Mutual, Inc.

574,300

58,004

 

9,424,796

TOTAL FINANCIALS

1,228,804,751

HEALTH CARE - 8.3%

Biotechnology - 0.6%

Amgen, Inc. (a)

567,622

30,049,909

Health Care Equipment & Supplies - 0.8%

Boston Scientific Corp. (a)

2,033,862

20,623,361

Covidien PLC

528,536

19,788,388

 

40,411,749

Common Stocks - continued

Shares

Value

HEALTH CARE - continued

Health Care Providers & Services - 0.3%

Brookdale Senior Living, Inc.

715,901

$ 6,972,876

Fresenius Medical Care AG & Co. KGaA

166,400

7,443,422

 

14,416,298

Pharmaceuticals - 6.6%

Abbott Laboratories

332,300

15,631,392

Bristol-Myers Squibb Co.

1,039,900

21,120,369

Johnson & Johnson

1,000,829

56,847,087

Merck & Co., Inc.

1,451,900

40,595,124

Pfizer, Inc.

5,488,400

82,326,000

Schering-Plough Corp.

1,387,136

34,844,856

Wyeth

1,900,900

86,281,851

 

337,646,679

TOTAL HEALTH CARE

422,524,635

INDUSTRIALS - 8.4%

Aerospace & Defense - 2.6%

General Dynamics Corp.

168,700

9,344,293

Honeywell International, Inc.

1,533,125

48,140,125

Spirit AeroSystems Holdings, Inc. Class A (a)

769,882

10,578,179

The Boeing Co.

511,684

21,746,570

United Technologies Corp.

799,040

41,518,118

 

131,327,285

Building Products - 0.2%

Masco Corp.

1,269,200

12,158,936

Commercial Services & Supplies - 0.3%

Avery Dennison Corp.

367,602

9,440,019

Republic Services, Inc.

202,739

4,948,859

 

14,388,878

Electrical Equipment - 0.1%

Cooper Industries Ltd. Class A

135,100

4,194,855

Rockwell Automation, Inc.

101,300

3,253,756

 

7,448,611

Industrial Conglomerates - 2.6%

General Electric Co.

4,344,277

50,914,926

Rheinmetall AG

292,133

12,641,558

Siemens AG sponsored ADR

532,200

36,822,918

Textron, Inc.

1,337,600

12,921,216

Tyco International Ltd.

601,736

15,633,101

 

128,933,719

Machinery - 2.1%

Briggs & Stratton Corp.

1,046,088

13,954,814

Caterpillar, Inc.

101,800

3,363,472

Cummins, Inc.

417,900

14,714,259

Danaher Corp.

299,400

18,484,956

Eaton Corp.

384,500

17,152,545

Illinois Tool Works, Inc.

294,800

11,007,832

Ingersoll-Rand Co. Ltd. Class A

582,088

12,165,639

 

Shares

Value

Kennametal, Inc.

438,691

$ 8,414,093

Vallourec SA (e)

41,500

5,037,089

 

104,294,699

Road & Rail - 0.5%

Burlington Northern Santa Fe Corp.

89,300

6,567,122

CSX Corp.

135,100

4,678,513

Union Pacific Corp.

266,500

13,873,990

 

25,119,625

TOTAL INDUSTRIALS

423,671,753

INFORMATION TECHNOLOGY - 8.6%

Communications Equipment - 1.1%

Cisco Systems, Inc. (a)

2,201,080

41,028,131

Motorola, Inc.

2,139,412

14,184,302

 

55,212,433

Computers & Peripherals - 1.5%

Dell, Inc. (a)

500,700

6,874,611

Hewlett-Packard Co.

1,224,965

47,344,897

International Business Machines Corp.

204,300

21,333,006

 

75,552,514

Electronic Equipment & Components - 1.2%

Arrow Electronics, Inc. (a)

833,400

17,701,416

Avnet, Inc. (a)

1,038,554

21,840,791

Tyco Electronics Ltd.

1,197,936

22,269,630

 

61,811,837

IT Services - 0.1%

MoneyGram International, Inc. (a)

895,100

1,593,278

The Western Union Co.

294,281

4,826,208

 

6,419,486

Office Electronics - 0.1%

Xerox Corp.

1,034,035

6,700,547

Semiconductors & Semiconductor Equipment - 3.3%

Analog Devices, Inc.

863,800

21,404,964

Applied Materials, Inc.

2,099,600

23,032,612

Atmel Corp. (a)

766,800

2,860,164

Intel Corp.

3,503,400

57,981,270

Micron Technology, Inc. (a)

1,507,800

7,629,468

National Semiconductor Corp.

1,714,847

21,521,330

Novellus Systems, Inc. (a)

721,139

12,043,021

Teradyne, Inc. (a)

1,659,200

11,382,112

Varian Semiconductor Equipment Associates, Inc. (a)

296,000

7,101,040

 

164,955,981

Software - 1.3%

Microsoft Corp.

1,468,560

34,907,671

Oracle Corp.

843,108

18,059,373

Symantec Corp. (a)

619,233

9,635,265

 

62,602,309

TOTAL INFORMATION TECHNOLOGY

433,255,107

Common Stocks - continued

Shares

Value

MATERIALS - 1.6%

Chemicals - 0.9%

Celanese Corp. Class A

409,200

$ 9,718,500

Dow Chemical Co.

432,700

6,983,778

E.I. du Pont de Nemours & Co.

786,800

20,157,816

H.B. Fuller Co.

384,613

7,219,186

 

44,079,280

Metals & Mining - 0.7%

Alcoa, Inc.

1,241,171

12,821,296

Commercial Metals Co.

473,355

7,587,881

Freeport-McMoRan Copper & Gold, Inc. Class B

84,300

4,224,273

Nucor Corp.

250,800

11,143,044

 

35,776,494

TOTAL MATERIALS

79,855,774

TELECOMMUNICATION SERVICES - 6.6%

Diversified Telecommunication Services - 5.9%

AT&T, Inc.

7,071,669

175,660,258

Qwest Communications International, Inc.

7,838,900

32,531,435

Verizon Communications, Inc.

2,949,102

90,625,904

 

298,817,597

Wireless Telecommunication Services - 0.7%

Sprint Nextel Corp. (a)

3,678,878

17,695,403

Vodafone Group PLC sponsored ADR

879,087

17,133,406

 

34,828,809

TOTAL TELECOMMUNICATION SERVICES

333,646,406

UTILITIES - 3.6%

Electric Utilities - 1.8%

Allegheny Energy, Inc.

1,060,904

27,212,188

Entergy Corp.

383,159

29,702,486

Exelon Corp.

590,400

30,234,384

Southern Co.

50,700

1,579,812

 

88,728,870

Independent Power Producers & Energy Traders - 0.5%

AES Corp.

2,329,758

27,048,490

Multi-Utilities - 1.3%

Public Service Enterprise Group, Inc.

1,266,300

41,319,369

Wisconsin Energy Corp.

634,600

25,834,566

 

67,153,935

TOTAL UTILITIES

182,931,295

TOTAL COMMON STOCKS

(Cost $5,680,381,342)

4,824,688,087

Convertible Preferred Stocks - 1.8%

Shares

Value

CONSUMER DISCRETIONARY - 0.0%

Automobiles - 0.0%

General Motors Corp. Series C, 6.25%

471,200

$ 1,333,496

FINANCIALS - 0.9%

Capital Markets - 0.3%

Legg Mason, Inc. 7.00%

542,900

13,639,820

Commercial Banks - 0.2%

Huntington Bancshares, Inc. 8.50%

9,000

6,534,000

Wells Fargo & Co. 7.50%

2,990

2,347,060

 

8,881,060

Diversified Financial Services - 0.3%

CIT Group, Inc. Series C, 8.75%

81,800

1,410,814

Citigroup, Inc. Series T, 6.50%

384,449

12,903,070

 

14,313,884

Insurance - 0.1%

American International Group, Inc. Series A, 8.50%

469,454

4,469,202

Assured Guaranty Ltd. 8.50% (a)

67,700

3,689,650

 

8,158,852

TOTAL FINANCIALS

44,993,616

HEALTH CARE - 0.4%

Pharmaceuticals - 0.4%

Schering-Plough Corp. 6.00%

93,000

21,090,540

MATERIALS - 0.5%

Chemicals - 0.1%

Celanese Corp. 4.25%

111,200

3,493,904

Metals & Mining - 0.4%

Freeport-McMoRan Copper & Gold, Inc. 6.75%

232,700

18,383,300

TOTAL MATERIALS

21,877,204

TOTAL CONVERTIBLE PREFERRED STOCKS

(Cost $150,831,173)

89,294,856

Corporate Bonds - 1.8%

 

Principal Amount

 

Convertible Bonds - 1.7%

CONSUMER DISCRETIONARY - 0.9%

Auto Components - 0.1%

Johnson Controls, Inc. 6.5% 9/30/12

$ 3,460,000

6,980,833

Diversified Consumer Services - 0.0%

Ingersoll-Rand Global Holding Co. Ltd. 4.5% 4/15/12

1,270,000

1,703,070

Household Durables - 0.1%

Newell Rubbermaid, Inc. 5.5% 3/15/14

1,460,000

2,060,994

Corporate Bonds - continued

 

Principal Amount

Value

Convertible Bonds - continued

CONSUMER DISCRETIONARY - continued

Media - 0.7%

Liberty Media Corp.:

3.5% 1/15/31

$ 257,246

$ 138,836

4% 11/15/29 (f)

4,750,000

1,425,000

3.5% 1/15/31 (f)

9,412,957

5,080,192

News America, Inc. liquid yield option note:

0% 2/28/21 (f)

22,670,000

14,055,400

0% 2/28/21

3,490,000

2,163,800

Virgin Media, Inc. 6.5% 11/15/16 (f)

15,354,000

11,993,009

 

34,856,237

TOTAL CONSUMER DISCRETIONARY

45,601,134

FINANCIALS - 0.1%

Thrifts & Mortgage Finance - 0.1%

MGIC Investment Corp. 9% 4/1/63 (d)(f)

10,438,000

4,331,770

INDUSTRIALS - 0.1%

Airlines - 0.1%

UAL Corp.:

4.5% 6/30/21 (f)

8,490,000

2,759,250

4.5% 6/30/21

280,000

91,000

 

2,850,250

Industrial Conglomerates - 0.0%

Textron, Inc. 4.5% 5/1/13

1,920,000

1,926,336

Road & Rail - 0.0%

Hertz Global Holdings, Inc. 5.25% 6/1/14

1,350,000

1,530,459

TOTAL INDUSTRIALS

6,307,045

INFORMATION TECHNOLOGY - 0.3%

Semiconductors & Semiconductor Equipment - 0.3%

Advanced Micro Devices, Inc.:

6% 5/1/15 (f)

14,340,000

6,722,592

6% 5/1/15

4,780,000

2,240,864

Micron Technology, Inc.:

1.875% 6/1/14

2,570,000

1,507,331

4.25% 10/15/13

1,870,000

2,204,263

 

12,675,050

 

 

Principal Amount

Value

MATERIALS - 0.3%

Metals & Mining - 0.3%

Alcoa, Inc. 5.25% 3/15/14

$ 3,240,000

$ 5,690,250

ArcelorMittal SA 5% 5/15/14

2,670,000

3,378,084

United States Steel Corp. 4% 5/15/14

4,470,000

5,850,113

 

14,918,447

TOTAL CONVERTIBLE BONDS

83,833,446

Nonconvertible Bonds - 0.1%

MATERIALS - 0.1%

Chemicals - 0.1%

Hercules, Inc. 6.5% 6/30/29 unit

15,700,000

7,386,850

TOTAL CORPORATE BONDS

(Cost $115,958,467)

91,220,296

Money Market Funds - 1.5%

Shares

 

Fidelity Cash Central Fund, 0.40% (b)

42,368,159

42,368,159

Fidelity Securities Lending Cash Central Fund, 0.22% (b)(c)

31,829,460

31,829,460

TOTAL MONEY MARKET FUNDS

(Cost $74,197,619)

74,197,619

TOTAL INVESTMENT PORTFOLIO - 100.5%

(Cost $6,021,368,601)

5,079,400,858

NET OTHER ASSETS - (0.5)%

(24,305,997)

NET ASSETS - 100%

$ 5,055,094,861

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 unaudited listing of the fund's holdings as of its most recent quarter end is available upon request.

(c) Investment made with cash collateral received from securities on loan.

(d) Non-income producing - Issuer is in default.

(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 end of the period, the value of these securities amounted to $49,976,213 or 1.0% of net assets.

Affiliated Central Funds

Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:

Fund

Income earned

Fidelity Cash Central Fund

$ 74,563

Fidelity Securities Lending Cash Central Fund

1,563,689

Total

$ 1,638,252

Other Information

The following is a summary of the inputs used, as of June 30, 2009, involving the Fund's assets and liabilities carried at value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the tables below, please refer to the Security Valuation section in the accompanying Notes to Financial Statements.

Valuation Inputs at Reporting Date:

Description

Total

Level 1

Level 2

Level 3

Investments in Securities:

Equities:

Consumer Discretionary

$ 639,328,013

$ 623,201,557

$ 16,126,456

$ -

Consumer Staples

308,876,236

308,876,236

-

-

Energy

773,127,613

773,127,613

-

-

Financials

1,273,798,367

1,234,083,296

39,715,071

-

Health Care

443,615,175

422,524,635

21,090,540

-

Industrials

423,671,753

423,671,753

-

-

Information Technology

433,255,107

433,255,107

-

-

Materials

101,732,978

79,855,774

21,877,204

-

Telecommunication Services

333,646,406

333,646,406

-

-

Utilities

182,931,295

182,931,295

-

-

Corporate Bonds

91,220,296

-

91,220,296

-

Money Market Funds

74,197,619

74,197,619

-

-

Total Investments in Securities

$ 5,079,400,858

$ 4,889,371,291

$ 190,029,567

$ -

The following is a reconciliation of assets or liabilities for which level 3 inputs were used in determining value:

 

Investments in Securities

 

Beginning Balance

$ 11,592,000

Total Realized Gain (Loss)

-

Total Unrealized Gain (Loss)

3,200,960

Cost of Purchases

-

Proceeds of Sales

-

Amortization/Accretion

-

Transfers in/out of Level 3

(14,792,960)

Ending Balance

$ -

Total unrealized gain (loss) on investments held at June 30, 2009

$ -

The information used in the above reconciliation represents fiscal year to date activity for any Investment Securities identified as using Level 3 inputs at either the beginning or the end of the current fiscal period. Transfers in or out of Level 3 represents either the beginning value (for transfers in), or the ending value (for transfers out) of any Security or Instrument where a change in the pricing level occurred from the beginning to the end of the period.

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

United States of America

89.2%

Switzerland

3.3%

United Kingdom

1.7%

Bermuda

1.4%

Germany

1.2%

Netherlands Antilles

1.0%

Others (individually less than 1%)

2.2%

 

100.0%

Income Tax Information

At December 31, 2008, the fund had a capital loss carryforward of approximately $237,582,450 all of which will expire on December 31, 2016.

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

Semiannual Report

Financial Statements

Statement of Assets and Liabilities

 

June 30, 2009 (Unaudited)

Assets

Investment in securities, at value (including securities loaned of $29,842,792) - See accompanying schedule:

Unaffiliated issuers (cost $5,947,170,982)

$ 5,005,203,239

 

Fidelity Central Funds (cost $74,197,619)

74,197,619

 

Total Investments (cost $6,021,368,601)

 

$ 5,079,400,858

Cash

255,125

Receivable for investments sold

18,621,859

Receivable for fund shares sold

860,156

Dividends receivable

6,795,786

Interest receivable

722,709

Distributions receivable from Fidelity Central Funds

375,691

Prepaid expenses

32,190

Other receivables

198,228

Total assets

5,107,262,602

 

 

 

Liabilities

Payable for investments purchased

$ 12,226,081

Payable for fund shares redeemed

5,029,284

Accrued management fee

1,985,416

Distribution fees payable

315,180

Other affiliated payables

397,187

Other payables and accrued expenses

385,133

Collateral on securities loaned, at value

31,829,460

Total liabilities

52,167,741

 

 

 

Net Assets

$ 5,055,094,861

Net Assets consist of:

 

Paid in capital

$ 6,583,142,870

Undistributed net investment income

64,105,569

Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions

(650,184,816)

Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies

(941,968,762)

Net Assets

$ 5,055,094,861

Statement of Assets and Liabilities - continued

 

June 30, 2009 (Unaudited)

 

 

 

Initial Class:
Net Asset Value, offering price and redemption price per share ($3,218,005,930 ÷ 233,302,594 shares)

$ 13.79

 

 

 

Service Class:
Net Asset Value, offering price and redemption price per share ($377,726,495 ÷ 27,482,177 shares)

$ 13.74

 

 

 

Service Class 2:
Net Asset Value, offering price and redemption price per share ($1,334,877,360 ÷ 98,225,665 shares)

$ 13.59

 

 

 

Service Class 2R:
Net Asset Value, offering price and redemption price per share ($4,735,718 ÷ 350,205 shares)

$ 13.52

 

 

 

Investor Class:
Net Asset Value, offering price and redemption price per share ($119,749,358 ÷ 8,704,093 shares)

$ 13.76

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

Semiannual Report

Statement of Operations

Six months ended June 30, 2009 (Unaudited)

 

 

 

Investment Income

 

 

Dividends

 

$ 78,684,418

Interest

 

3,388,742

Income from Fidelity Central Funds

 

1,638,252

Total income

 

83,711,412

 

 

 

Expenses

Management fee

$ 10,913,211

Transfer agent fees

2,075,983

Distribution fees

1,715,578

Accounting and security lending fees

600,525

Custodian fees and expenses

40,363

Independent trustees' compensation

18,967

Appreciation in deferred trustee compensation account

72

Audit

40,248

Legal

5,402

Interest

3,700

Miscellaneous

218,452

Total expenses before reductions

15,632,501

Expense reductions

(6,169)

15,626,332

Net investment income (loss)

68,085,080

Realized and Unrealized Gain (Loss)

Net realized gain (loss) on:

Investment securities:

 

 

Unaffiliated issuers

(353,043,252)

Foreign currency transactions

(91,438)

Total net realized gain (loss)

 

(353,134,690)

Change in net unrealized appreciation (depreciation) on:

Investment securities

481,302,553

Assets and liabilities in foreign currencies

1,582

Total change in net unrealized appreciation (depreciation)

 

481,304,135

Net gain (loss)

128,169,445

Net increase (decrease) in net assets resulting from operations

$ 196,254,525

Statement of Changes in Net Assets

 

Six months ended
June 30, 2009
(Unaudited)

Year ended
December 31,
2008

Increase (Decrease) in Net Assets

 

 

Operations

 

 

Net investment income (loss)

$ 68,085,080

$ 188,293,003

Net realized gain (loss)

(353,134,690)

(284,674,239)

Change in net unrealized appreciation (depreciation)

481,304,135

(4,122,622,475)

Net increase (decrease) in net assets resulting from operations

196,254,525

(4,219,003,711)

Distributions to shareholders from net investment income

(6,586,996)

(186,575,269)

Distributions to shareholders from net realized gain

-

(8,976,342)

Total distributions

(6,586,996)

(195,551,611)

Share transactions - net increase (decrease)

(311,845,780)

(1,357,103,153)

Redemption fees

269

1,769

Total increase (decrease) in net assets

(122,177,982)

(5,771,656,706)

 

 

 

Net Assets

Beginning of period

5,177,272,843

10,948,929,549

End of period (including undistributed net investment income of $64,105,569 and undistributed net investment income of $2,607,485, respectively)

$ 5,055,094,861

$ 5,177,272,843

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

Semiannual Report

Financial Highlights - Initial Class

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 13.18

$ 23.91

$ 26.20

$ 25.49

$ 25.37

$ 23.18

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .18

.47

.47

.45

.42

.40

Net realized and unrealized gain (loss)

  .45

(10.67)

(.05) H

4.37

1.00

2.24

Total from investment operations

  .63

(10.20)

.42

4.82

1.42

2.64

Distributions from net investment income

  (.02)

(.51)

(.50)

(.89)

(.41)

(.36)

Distributions from net realized gain

  -

(.02)

(2.21)

(3.22)

(.89)

(.09)

Total distributions

  (.02)

(.53)

(2.71)

(4.11)

(1.30)

(.45)

Redemption fees added to paid in capital E, J

  -

-

-

-

-

-

Net asset value, end of period

$ 13.79

$ 13.18

$ 23.91

$ 26.20

$ 25.49

$ 25.37

Total Return B, C, D

  4.78%

(42.65)%

1.53%

20.19%

5.87%

11.53%

Ratios to Average Net Assets F, I

 

 

 

 

 

 

Expenses before reductions

  .59% A

.57%

.55%

.57%

.56%

.58%

Expenses net of fee waivers, if any

  .59% A

.57%

.55%

.57%

.56%

.58%

Expenses net of all reductions

  .59% A

.57%

.54%

.56%

.55%

.57%

Net investment income (loss)

  2.98% A

2.37%

1.71%

1.76%

1.71%

1.71%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 3,218,006

$ 3,322,799

$ 7,201,655

$ 8,315,159

$ 7,875,801

$ 8,689,829

Portfolio turnover rate G

  26% A

34%

20%

22%

19%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund. I 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 fee 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. J Amount represents less than $.01 per share.

Financial Highlights - Service Class

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 13.14

$ 23.82

$ 26.11

$ 25.39

$ 25.28

$ 23.11

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .18

.44

.44

.43

.39

.38

Net realized and unrealized gain (loss)

  .44

(10.62)

(.05) H

4.35

1.00

2.22

Total from investment operations

  .62

(10.18)

.39

4.78

1.39

2.60

Distributions from net investment income

  (.02)

(.48)

(.47)

(.84)

(.39)

(.34)

Distributions from net realized gain

  -

(.02)

(2.21)

(3.22)

(.89)

(.09)

Total distributions

  (.02)

(.50)

(2.68)

(4.06)

(1.28)

(.43)

Redemption fees added to paid in capital E, J

  -

-

-

-

-

-

Net asset value, end of period

$ 13.74

$ 13.14

$ 23.82

$ 26.11

$ 25.39

$ 25.28

Total Return B, C, D

  4.72%

(42.70)%

1.42%

20.08%

5.76%

11.38%

Ratios to Average Net Assets F, I

 

 

 

 

 

 

Expenses before reductions

  .69% A

.67%

.65%

.67%

.66%

.68%

Expenses net of fee waivers, if any

  .69% A

.67%

.65%

.67%

.66%

.68%

Expenses net of all reductions

  .69% A

.67%

.64%

.66%

.65%

.67%

Net investment income (loss)

  2.88% A

2.27%

1.61%

1.66%

1.61%

1.61%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 377,726

$ 405,082

$ 920,054

$ 1,118,333

$ 1,079,838

$ 1,170,778

Portfolio turnover rate G

  26% A

34%

20%

22%

19%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund. I 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 fee 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. J Amount represents less than $.01 per share.

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

Semiannual Report

Financial Highlights - Service Class 2

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 13.00

$ 23.57

$ 25.87

$ 25.17

$ 25.09

$ 22.96

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .17

.41

.39

.38

.35

.34

Net realized and unrealized gain (loss)

  .44

(10.50)

(.04) H

4.32

.98

2.21

Total from investment operations

  .61

(10.09)

.35

4.70

1.33

2.55

Distributions from net investment income

  (.02)

(.46)

(.44)

(.78)

(.36)

(.33)

Distributions from net realized gain

  -

(.02)

(2.21)

(3.22)

(.89)

(.09)

Total distributions

  (.02)

(.48)

(2.65)

(4.00)

(1.25)

(.42)

Redemption fees added to paid in capital E, J

  -

-

-

-

-

-

Net asset value, end of period

$ 13.59

$ 13.00

$ 23.57

$ 25.87

$ 25.17

$ 25.09

Total Return B, C, D

  4.69%

(42.81)%

1.27%

19.93%

5.57%

11.23%

Ratios to Average Net Assets F, I

 

 

 

 

 

 

Expenses before reductions

  .84% A

.82%

.80%

.82%

.81%

.83%

Expenses net of fee waivers, if any

  .84% A

.82%

.80%

.82%

.81%

.83%

Expenses net of all reductions

  .84% A

.82%

.80%

.82%

.80%

.82%

Net investment income (loss)

  2.73% A

2.12%

1.46%

1.51%

1.46%

1.46%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 1,334,877

$ 1,321,569

$ 2,583,129

$ 2,373,059

$ 1,723,546

$ 1,420,999

Portfolio turnover rate G

  26% A

34%

20%

22%

19%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund. I 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 fee 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. J Amount represents less than $.01 per share.

Financial Highlights - Service Class 2R

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 12.93

$ 23.44

$ 25.73

$ 25.08

$ 25.01

$ 22.91

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .17

.41

.39

.38

.35

.34

Net realized and unrealized gain (loss)

  .44

(10.45)

(.04) H

4.29

.99

2.20

Total from investment operations

  .61

(10.04)

.35

4.67

1.34

2.54

Distributions from net investment income

  (.02)

(.45)

(.43)

(.80)

(.38)

(.35)

Distributions from net realized gain

  -

(.02)

(2.21)

(3.22)

(.89)

(.09)

Total distributions

  (.02)

(.47)

(2.64)

(4.02)

(1.27)

(.44)

Redemption fees added to paid in capital E, J

  -

-

-

-

-

-

Net asset value, end of period

$ 13.52

$ 12.93

$ 23.44

$ 25.73

$ 25.08

$ 25.01

Total Return B, C, D

  4.72%

(42.82)%

1.27%

19.89%

5.61%

11.22%

Ratios to Average Net Assets F, I

 

 

 

 

 

 

Expenses before reductions

  .84% A

.82%

.80%

.82%

.81%

.83%

Expenses net of fee waivers, if any

  .84% A

.82%

.80%

.82%

.81%

.83%

Expenses net of all reductions

  .84% A

.81%

.79%

.81%

.80%

.82%

Net investment income (loss)

  2.73% A

2.12%

1.46%

1.51%

1.46%

1.46%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 4,736

$ 5,339

$ 13,558

$ 17,089

$ 9,651

$ 5,617

Portfolio turnover rate G

  26% A

34%

20%

22%

19%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund. I 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 fee 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. J Amount represents less than $.01 per share.

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

Semiannual Report

Financial Highlights - Investor Class

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005 I

Selected Per-Share Data

 

 

 

 

 

Net asset value, beginning of period

$ 13.15

$ 23.85

$ 26.15

$ 25.48

$ 24.46

Income from Investment Operations

 

 

 

 

 

Net investment income (loss) E

  .18

.44

.44

.42

.17

Net realized and unrealized gain (loss)

  .45

(10.63)

(.05) H

4.36

.85

Total from investment operations

  .63

(10.19)

.39

4.78

1.02

Distributions from net investment income

  (.02)

(.49)

(.48)

(.89)

-

Distributions from net realized gain

  -

(.02)

(2.21)

(3.22)

-

Total distributions

  (.02)

(.51)

(2.69)

(4.11)

-

Redemption fees added to paid in capital E, K

  -

-

-

-

-

Net asset value, end of period

$ 13.76

$ 13.15

$ 23.85

$ 26.15

$ 25.48

Total Return B, C, D

  4.79%

(42.71)%

1.39%

20.04%

4.17%

Ratios to Average Net Assets F, J

 

 

 

 

 

Expenses before reductions

  .70% A

.66%

.66%

.69%

.74% A

Expenses net of fee waivers, if any

  .70% A

.66%

.66%

.69%

.74% A

Expenses net of all reductions

  .70% A

.66%

.66%

.69%

.73% A

Net investment income (loss)

  2.87% A

2.28%

1.60%

1.63%

1.54% A

Supplemental Data

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 119,749

$ 122,483

$ 230,534

$ 170,050

$ 37,500

Portfolio turnover rate G

  26% A

34%

20%

22%

19%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund. I For the period July 21, 2005 (commencement of sale of shares) to December 31, 2005. J 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 fee 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. K Amount represents less than $.01 per share.

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

Semiannual Report

Notes to Financial Statements

For the period ended June 30, 2009 (Unaudited)

1. Organization.

VIP Equity-Income Portfolio (the Fund) is a fund of Variable Insurance Products Fund (the trust) and is authorized to issue an unlimited number of shares. The trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. Shares of the Fund may only be purchased by insurance companies for the purpose of funding variable annuity or variable life insurance contracts. The Fund offers the following classes of shares: Initial Class shares, Service Class shares, Service Class 2 shares, Service Class 2R shares and Investor Class 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 transfer agent and distribution and service plan fees incurred. Certain expense reductions also differ by class.

2. Investments in Fidelity Central Funds.

The Fund may invest in Fidelity Central Funds, which are open-end investment companies available only to other investment companies and accounts managed by Fidelity Management & Research Company (FMR) and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.

The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of FMR.

A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the SEC's web site at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC's web site or upon request.

3. Significant Accounting Policies.

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. Actual results could differ from those estimates. Events or transactions occurring after period end through the date that the financial statements were issued, August 10, 2009, have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:

Security Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Fund uses independent pricing services approved by the Board of Trustees to value its investments. Generally Accepted Accounting Principles (GAAP) establishes a disclosure hierarchy that categorizes the inputs to valuation techniques used to value assets and liabilities at measurement date. These inputs are classified into three levels. Level 1 includes readily available unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 includes observable inputs other than quoted prices included in Level 1 that are observable either directly or indirectly. Level 3 includes unobservable inputs when market prices are not readily available or reliable. Changes in valuation techniques may result in transfers in or out of an investment's assigned level within the hierarchy. The aggregate value by input level, as of June 30, 2009, for the Fund's investments is included at the end of the Fund's Schedule of Investments. Valuation techniques of the Fund's major categories of assets and liabilities as presented in the Schedule of Investments are as follows.

Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by an independent pricing service on the primary market or exchange on which they are traded. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price. Debt securities, including restricted securities, are valued based on quotations received from dealers who make markets in such securities or by independent pricing services. For corporate bonds, pricing services generally utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type as well as dealer supplied prices. Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value each business day. Short-term securities with remaining maturities of sixty days or less for which quotations are not readily available are valued at amortized cost, which approximates value.

When current market prices or quotations are not readily available or reliable, valuations may be determined in good faith in accordance with procedures adopted by the Board of Trustees. Factors used in determining value may include significant market or security specific events, changes in interest rates and credit quality, and developments in foreign markets which are monitored by evaluating the performance of ADRs, futures contracts and exchange-traded funds. The frequency with which these procedures are used cannot be predicted and may be utilized to a significant extent. The value of securities used for net asset value (NAV) calculation under these procedures may differ from published prices for the same securities.

Foreign Currency. The Fund uses 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.

Semiannual Report

Notes to Financial Statements (Unaudited) - continued

3. Significant Accounting Policies - continued

Foreign Currency - continued

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. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. 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 Fund is 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 Fund estimates the components of distributions received that may be considered return of capital distributions or capital gain distributions. Interest income and distributions from the Fidelity Central Funds are accrued as earned. Interest income includes coupon interest and amortization of premium and accretion of discount on debt securities. 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 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 collectability of interest is reasonably assured.

Expenses. Most expenses of the trust can be directly attributed to a fund. Expenses which cannot be directly attributed are apportioned among each fund in the trust. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.

Deferred Trustee Compensation. Under a Deferred Compensation Plan (the Plan), independent 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 invested in a cross-section of Fidelity funds, are marked-to-market and remain in the Fund until distributed in accordance with the Plan. The investment of deferred amounts and the offsetting payable to the Trustees are included in the accompanying Statement of Assets and Liabilities.

Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company by distributing substantially all of its taxable income and realized gains under Subchapter M of the Internal Revenue Code and filing its U.S. federal tax return. As a result, no provision for income taxes is required. The Fund is subject to the provisions of FASB Interpretation No. 48, Accounting for Uncertainties in Income Taxes (FIN 48). FIN 48 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. There are no unrecognized tax benefits in the accompanying financial statements. A Fund's federal tax return is subject to examination by the Internal Revenue Service (IRS) for a period of three years. Foreign taxes are provided for based on the 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 foreign currency transactions, passive foreign investment companies (PFIC), market discount, partnerships, deferred trustees compensation, capital loss carryforwards and losses deferred due to wash sales.

The federal tax cost of investments and unrealized appreciation (depreciation) as of period end were as follows:

Unrealized appreciation

$ 812,540,158

Unrealized depreciation

(1,782,938,160)

Net unrealized appreciation (depreciation)

$ (970,398,002)

Cost for federal income tax purposes

$ 6,049,798,860

Trading (Redemption) Fees. Service Class 2 R 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 Fund and accounted for as an addition to paid in capital.

Semiannual Report

4. Operating Policies.

Restricted Securities. The Fund 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 the Fund's Schedule of Investments.

5. Purchases and Sales of Investments.

Purchases and sales of securities, other than short-term securities, aggregated $605,164,798 and $884,167,993, respectively.

6. Fees and Other Transactions with Affiliates.

Management Fee. FMR and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .20% of the Fund's average net assets and a group fee rate that averaged .27% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by FMR. The group fee rate decreases as assets under management increase and increases as assets under management decrease. For the period, the total annualized management fee rate was .47% of the Fund's average net assets.

Distribution and Service Plan. In accordance with Rule 12b-1 of the 1940 Act, the Fund has 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 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

$ 178,119

Service Class 2

1,531,820

Service Class 2R

5,639

 

$ 1,715,578

Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc. (FIIOC), an affiliate of FMR, is the Fund's transfer, dividend disbursing, and shareholder servicing agent. FIIOC receives an asset-based fee with respect to each class. Each class (with the exception of Investor Class) pays a transfer agent fee, excluding out of pocket expenses, equal to an annual rate of .07% of average net assets. Investor Class pays a monthly asset-based transfer agent fee of .15% of average net assets. The total transfer agent fees paid by each class to FIIOC, including out of pocket expenses, were as follows:

Initial Class

$ 1,285,942

Service Class

153,021

Service Class 2

526,187

Service Class 2R

1,920

Investor Class

108,913

 

$ 2,075,983

Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of FMR, maintains the 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.

Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. The commissions paid to these affiliated firms were $14,883 for the period.

Interfund Lending Program. Pursuant to an Exemptive Order issued by the Securities and Exchange Commission (the SEC), the Fund, 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 affiliated funds. At period end, there were no interfund loans outstanding. The Fund's activity in this program during the period for which loans were outstanding was as follows:

Borrower or Lender

Average Daily Loan
Balance

Weighted Average
Interest Rate

Interest
Expense

Borrower

$ 8,332,324

.43%

$ 3,700

Semiannual Report

Notes to Financial Statements (Unaudited) - continued

7. Committed Line of Credit.

The Fund participates with other funds managed by FMR in a $3.5 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 Fund has agreed to pay commitment fees on its pro-rata portion of the line of credit, which amounted to $15,104 and is reflected in Miscellaneous Expense on the Statement of Operations. During the period, there were no borrowings on this line of credit.

8. Security Lending.

The Fund lends portfolio securities from time to time in order to earn additional income. On the settlement date of the loan, the 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 Fund and any additional required collateral is delivered to the Fund 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. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. Security lending income represents the income earned on investing cash collateral, less fees and expenses associated with the loan, plus any premium payments that may be received on the loan of certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds. Net income from lending portfolio securities during the period amounted to $1,563,689.

9. Expense Reductions.

Many of the brokers with whom FMR places trades on behalf of the Fund provided services to the Fund in addition to trade execution. These services included payments of certain expenses on behalf of the Fund totaling $6,169 for the period.

10. Distributions to Shareholders.

Distributions to shareholders of each class were as follows:

Six months ended
June 30,
2009

Year ended
December 31,
2008

From net investment income

 

 

Initial Class

$ 4,193,590

$ 123,156,013

Service Class

508,338

14,421,360

Service Class 2

1,722,825

44,390,804

Service Class 2R

6,680

178,863

Investor Class

155,563

4,428,229

Total

$ 6,586,996

$ 186,575,269

From net realized gain

 

 

Initial Class

$ -

$ 5,874,187

Service Class

-

748,441

Service Class 2

-

2,153,837

Service Class 2R

-

10,338

Investor Class

-

189,539

Total

$ -

$ 8,976,342

Semiannual Report

11. Share Transactions.

Transactions for each class of shares were as follows:

 

Shares

Dollars

Six months ended
June 30,
2009

Year ended
December 31,
2008

Six months ended
June 30,
2009

Year ended
December 31,
2008

Initial Class

 

 

 

 

Shares sold

5,733,572

7,761,257

$ 71,432,365

$ 147,326,576

Reinvestment of distributions

360,274

9,853,413

4,193,590

129,030,200

Shares redeemed

(24,959,443)

(66,674,318)

(300,587,458)

(1,304,182,592)

Net increase (decrease)

(18,865,597)

(49,059,648)

$ (224,961,503)

$ (1,027,825,816)

Service Class

 

 

 

 

Shares sold

940,973

1,403,882

$ 11,786,691

$ 26,376,852

Reinvestment of distributions

43,822

1,160,264

508,338

15,169,801

Shares redeemed

(4,338,089)

(10,352,999)

(52,042,407)

(200,182,896)

Net increase (decrease)

(3,353,294)

(7,788,853)

$ (39,747,378)

$ (158,636,243)

Service Class 2

 

 

 

 

Shares sold

6,668,545

12,836,633

$ 80,423,381

$ 239,743,721

Reinvestment of distributions

150,203

3,603,934

1,722,825

46,544,641

Shares redeemed

(10,258,793)

(24,390,530)

(121,683,243)

(445,540,000)

Net increase (decrease)

(3,440,045)

(7,949,963)

$ (39,537,037)

$ (159,251,638)

Service Class 2R

 

 

 

 

Shares sold

35,848

75,542

$ 464,584

$ 1,570,935

Reinvestment of distributions

585

14,668

6,680

189,201

Shares redeemed

(98,996)

(255,760)

(1,157,670)

(5,069,469)

Net increase (decrease)

(62,563)

(165,550)

$ (686,406)

$ (3,309,333)

Investor Class

 

 

 

 

Shares sold

576,511

1,599,925

$ 7,169,873

$ 30,095,055

Reinvestment of distributions

13,399

354,134

155,563

4,617,768

Shares redeemed

(1,199,811)

(2,304,633)

(14,238,892)

(42,792,946)

Net increase (decrease)

(609,901)

(350,574)

$ (6,913,456)

$ (8,080,123)

12. Other.

The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund's maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

At the end of the period, FMR or its affiliates were the owners of record of 11% of the total outstanding shares of the Fund, and two otherwise unaffiliated shareholders were the owners of record of 31% of the total outstanding shares of the Fund.

Semiannual Report

Investment Adviser

Fidelity Management & Research Company
Boston, MA

Investment Sub-Adviser

FMR Co., Inc.

Fidelity Management & Research (U.K.) Inc.

Fidelity Research & Analysis Company

Fidelity Investments Japan Limited

FIL Investment Advisors

FIL Investment Advisors (U.K.) Ltd.

Fidelity Management & Research (Hong Kong) Limited

Fidelity Management & Research (Japan) Inc.

General Distributor

Fidelity Distributors Corporation
Boston, MA

Transfer and Service Agents

Fidelity Investments Institutional Operations Company, Inc.
Boston, MA 

Fidelity Service Company, Inc.
Boston, MA 

Custodian

The Northern Trust Company
Chicago, IL 

VIPEI2R-SANN-0809
1.833447.103

Fidelity® Variable Insurance Products:
Growth Portfolio

Semiannual Report

June 30, 2009

(2_fidelity_logos) (Registered_Trademark)

Contents

Shareholder Expense Example

<Click Here>

An example of shareholder expenses.

Investment Changes

<Click Here>

A summary of major shifts in the fund's investments over the past six months.

Investments

<Click Here>

A complete list of the fund's investments with their market values.

Financial Statements

<Click Here>

Statements of assets and liabilities, operations, and changes in net assets, as well as financial highlights.

Notes

<Click Here>

Notes to the financial statements.

To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov. You may also call 1-877-208-0098 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 LLC or an affiliated company.

This report and the financial statements contained herein are submitted for the general information of the shareholders of the fund. This report is not authorized for distribution to prospective investors in the fund 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 holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com or http://www.advisor.fidelity.com, as applicable.

NOT FDIC INSURED · MAY LOSE VALUE · NO BANK GUARANTEE

Neither the fund nor Fidelity Distributors Corporation is a bank.

Semiannual Report

Shareholder Expense Example

As a shareholder of the 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 Fund 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 (January 1, 2009 to June 30, 2009).

Actual Expenses

The first line of the accompanying table for each class of the 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. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.

Hypothetical Example for Comparison Purposes

The second line of the accompanying table for each class of the 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. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.

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.

 



Annualized
Expense Ratio


Beginning
Account Value
January 1, 2009


Ending
Account Value
June 30, 2009

Expenses Paid
During Period*
January 1, 2009
to June 30, 2009

Initial Class

.70%

 

 

 

Actual

 

$ 1,000.00

$ 1,044.50

$ 3.55

Hypothetical A

 

$ 1,000.00

$ 1,021.32

$ 3.51

Service Class

.80%

 

 

 

Actual

 

$ 1,000.00

$ 1,044.20

$ 4.05

Hypothetical A

 

$ 1,000.00

$ 1,020.83

$ 4.01

Service Class 2

.95%

 

 

 

Actual

 

$ 1,000.00

$ 1,043.20

$ 4.81

Hypothetical A

 

$ 1,000.00

$ 1,020.08

$ 4.76

Service Class 2R

.94%

 

 

 

Actual

 

$ 1,000.00

$ 1,043.30

$ 4.76

Hypothetical A

 

$ 1,000.00

$ 1,020.13

$ 4.71

Investor Class

.81%

 

 

 

Actual

 

$ 1,000.00

$ 1,043.80

$ 4.10

Hypothetical A

 

$ 1,000.00

$ 1,020.78

$ 4.06

A 5% return per year before expenses

* Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).

Semiannual Report

Investment Changes (Unaudited)

Top Ten Stocks as of June 30, 2009

 

% of fund's
net assets

% of fund's net assets
6 months ago

Cisco Systems, Inc.

4.4

2.8

QUALCOMM, Inc.

3.9

3.8

JPMorgan Chase & Co.

3.6

2.1

Google, Inc. Class A (sub. vtg.)

3.2

2.1

Wells Fargo & Co.

2.8

6.6

Medco Health Solutions, Inc.

2.5

4.9

Lowe's Companies, Inc.

2.1

0.2

Target Corp.

2.0

0.0

Apple, Inc.

2.0

0.8

Broadcom Corp. Class A

1.9

0.0

 

28.4

Top Five Market Sectors as of June 30, 2009

 

% of fund's
net assets

% of fund's net assets
6 months ago

Information Technology

33.7

24.5

Consumer Discretionary

14.8

4.7

Financials

13.0

22.9

Health Care

12.5

20.2

Industrials

10.4

3.3

Asset Allocation (% of fund's net assets)

As of June 30, 2009*

As of December 31, 2008**

fid4705

Stocks 98.6%

 

fid4705

Stocks 91.4%

 

fid4711

Short-Term
Investments and
Net Other Assets 1.4%

 

fid4711

Short-Term
Investments and
Net Other Assets 8.6%

 

* Foreign investments

11.5%

 

** Foreign investments

12.9%

 


fid4738

Semiannual Report

Investments June 30, 2009 (Unaudited)

Showing Percentage of Net Assets

Common Stocks - 98.6%

Shares

Value

CONSUMER DISCRETIONARY - 14.8%

Auto Components - 0.4%

Autoliv, Inc.

131,800

$ 3,791,886

BorgWarner, Inc.

163,100

5,569,865

Johnson Controls, Inc.

161,700

3,512,124

 

12,873,875

Automobiles - 0.4%

Harley-Davidson, Inc. (d)

854,900

13,857,929

Diversified Consumer Services - 1.2%

Strayer Education, Inc. (d)

180,520

39,373,217

Hotels, Restaurants & Leisure - 2.6%

Chipotle Mexican Grill, Inc. Class B (a)

13,893

969,592

Marriott International, Inc. Class A

183,976

4,060,350

McDonald's Corp.

666,476

38,315,705

Starbucks Corp. (a)

2,580,973

35,849,715

Starwood Hotels & Resorts Worldwide, Inc.

129,600

2,877,120

 

82,072,482

Household Durables - 0.9%

Black & Decker Corp.

315,913

9,054,067

Mohawk Industries, Inc. (a)

507,899

18,121,836

 

27,175,903

Media - 0.5%

McGraw-Hill Companies, Inc.

152,910

4,604,120

The DIRECTV Group, Inc. (a)

427,800

10,570,938

 

15,175,058

Multiline Retail - 2.0%

Target Corp.

1,612,324

63,638,428

Specialty Retail - 5.7%

Advance Auto Parts, Inc.

179,400

7,443,306

Best Buy Co., Inc.

646,915

21,665,183

DSW, Inc. Class A (a)(d)

160,728

1,583,171

Home Depot, Inc.

521,200

12,315,956

Lowe's Companies, Inc.

3,457,391

67,107,959

O'Reilly Automotive, Inc. (a)

602,998

22,962,164

Ross Stores, Inc.

261,135

10,079,811

Sherwin-Williams Co.

316,746

17,025,098

Tiffany & Co., Inc.

114,214

2,896,467

TJX Companies, Inc.

564,506

17,759,359

 

180,838,474

Textiles, Apparel & Luxury Goods - 1.1%

Coach, Inc.

563,800

15,154,944

Lululemon Athletica, Inc. (a)

629,600

8,203,688

NIKE, Inc. Class B

247,500

12,815,550

 

36,174,182

TOTAL CONSUMER DISCRETIONARY

471,179,548

 

Shares

Value

CONSUMER STAPLES - 5.9%

Beverages - 1.2%

Anheuser-Busch InBev NV

144,300

$ 5,210,023

The Coca-Cola Co.

682,841

32,769,540

 

37,979,563

Food & Staples Retailing - 0.6%

Costco Wholesale Corp.

198,700

9,080,590

Wal-Mart Stores, Inc.

231,302

11,204,269

 

20,284,859

Food Products - 1.3%

Nestle SA sponsored ADR

1,067,250

40,149,945

Household Products - 1.6%

Colgate-Palmolive Co.

337,510

23,875,457

Energizer Holdings, Inc. (a)

527,969

27,581,101

 

51,456,558

Personal Products - 0.8%

Estee Lauder Companies, Inc. Class A

505,020

16,499,003

Mead Johnson Nutrition Co. Class A

184,712

5,868,300

Nu Skin Enterprises, Inc. Class A

261,348

3,998,624

 

26,365,927

Tobacco - 0.4%

Philip Morris International, Inc.

299,200

13,051,104

TOTAL CONSUMER STAPLES

189,287,956

ENERGY - 5.7%

Energy Equipment & Services - 2.8%

Schlumberger Ltd. (NY Shares)

917,314

49,635,861

Smith International, Inc.

492,800

12,689,600

Weatherford International Ltd. (a)

1,320,000

25,819,200

 

88,144,661

Oil, Gas & Consumable Fuels - 2.9%

Denbury Resources, Inc. (a)

2,128,950

31,359,434

Range Resources Corp.

525,923

21,778,471

Southwestern Energy Co. (a)

997,074

38,736,325

 

91,874,230

TOTAL ENERGY

180,018,891

FINANCIALS - 13.0%

Capital Markets - 2.9%

Charles Schwab Corp.

1,121,346

19,668,409

Franklin Resources, Inc.

235,400

16,951,154

Goldman Sachs Group, Inc.

232,709

34,310,615

JMP Group, Inc.

138,900

1,068,141

Morgan Stanley

701,900

20,011,169

T. Rowe Price Group, Inc.

31,300

1,304,271

 

93,313,759

Common Stocks - continued

Shares

Value

FINANCIALS - continued

Commercial Banks - 4.6%

PNC Financial Services Group, Inc.

1,459,620

$ 56,647,852

Wells Fargo & Co.

3,764,373

91,323,689

 

147,971,541

Consumer Finance - 0.7%

American Express Co.

892,400

20,739,376

Diversified Financial Services - 4.0%

CME Group, Inc.

40,012

12,448,133

JPMorgan Chase & Co.

3,391,698

115,690,819

 

128,138,952

Insurance - 0.5%

MetLife, Inc.

554,541

16,641,775

Real Estate Investment Trusts - 0.0%

Simon Property Group, Inc.

1,308

67,270

Real Estate Management & Development - 0.3%

Jones Lang LaSalle, Inc.

258,700

8,467,251

TOTAL FINANCIALS

415,339,924

HEALTH CARE - 12.5%

Biotechnology - 3.6%

Alexion Pharmaceuticals, Inc. (a)

161,942

6,659,055

Biogen Idec, Inc. (a)

472,961

21,354,189

Celgene Corp. (a)

217,035

10,382,954

Dendreon Corp. (a)

208,100

5,171,285

Gilead Sciences, Inc. (a)

862,500

40,399,500

Myriad Genetics, Inc. (a)

596,368

21,260,519

Myriad Pharmaceuticals, Inc. (a)

16,392

76,223

United Therapeutics Corp. (a)

108,820

9,067,971

Vanda Pharmaceuticals, Inc. (a)

60,300

709,731

 

115,081,427

Health Care Equipment & Supplies - 2.2%

C.R. Bard, Inc.

57,800

4,303,210

Covidien PLC

461,796

17,289,642

DENTSPLY International, Inc.

807,714

24,651,431

Edwards Lifesciences Corp. (a)

47,300

3,217,819

Integra LifeSciences Holdings Corp. (a)

132,700

3,517,877

NuVasive, Inc. (a)

395,251

17,628,195

Orthovita, Inc. (a)

354,500

1,825,675

 

72,433,849

Health Care Providers & Services - 3.7%

Express Scripts, Inc. (a)

407,405

28,009,094

Henry Schein, Inc. (a)

212,819

10,204,671

Medco Health Solutions, Inc. (a)

1,730,627

78,933,897

 

117,147,662

Life Sciences Tools & Services - 0.9%

Illumina, Inc. (a)

523,449

20,383,104

 

Shares

Value

Sequenom, Inc. (a)(d)

592,652

$ 2,317,269

Techne Corp.

84,165

5,370,569

 

28,070,942

Pharmaceuticals - 2.1%

Cadence Pharmaceuticals, Inc. (a)

336,388

3,360,516

Novo Nordisk AS Series B

587,569

31,766,769

Teva Pharmaceutical Industries Ltd. sponsored ADR

635,300

31,345,702

 

66,472,987

TOTAL HEALTH CARE

399,206,867

INDUSTRIALS - 10.4%

Aerospace & Defense - 1.8%

Honeywell International, Inc.

718,607

22,564,260

United Technologies Corp.

656,700

34,122,132

 

56,686,392

Air Freight & Logistics - 0.5%

United Parcel Service, Inc. Class B

319,800

15,986,802

Airlines - 0.8%

AirTran Holdings, Inc. (a)

1,576,836

9,760,615

Ryanair Holdings PLC sponsored ADR (a)

566,537

16,083,985

 

25,844,600

Building Products - 0.0%

USG Corp. (a)

100,900

1,016,063

Commercial Services & Supplies - 0.2%

Stericycle, Inc. (a)

92,300

4,756,219

Electrical Equipment - 0.6%

AMETEK, Inc.

499,100

17,258,878

Cooper Industries Ltd. Class A

103,900

3,226,095

 

20,484,973

Industrial Conglomerates - 0.3%

Textron, Inc.

1,036,520

10,012,783

Machinery - 2.9%

Cummins, Inc.

591,734

20,834,954

Danaher Corp.

619,300

38,235,582

Graco, Inc.

800,700

17,631,414

Ingersoll-Rand Co. Ltd. Class A

338,400

7,072,560

PACCAR, Inc.

293,000

9,525,430

 

93,299,940

Professional Services - 2.0%

CoStar Group, Inc. (a)

178,200

7,104,834

Dun & Bradstreet Corp.

138,139

11,218,268

Equifax, Inc.

124,000

3,236,400

FTI Consulting, Inc. (a)

468,659

23,770,384

Heidrick & Struggles International, Inc.

551,207

10,059,528

Korn/Ferry International (a)

441,766

4,700,390

Robert Half International, Inc.

125,500

2,964,310

 

63,054,114

Road & Rail - 1.1%

Heartland Express, Inc.

202,200

2,976,384

Common Stocks - continued

Shares

Value

INDUSTRIALS - continued

Road & Rail - continued

Knight Transportation, Inc.

1,090,625

$ 18,049,844

Old Dominion Freight Lines, Inc. (a)

386,032

12,959,094

 

33,985,322

Trading Companies & Distributors - 0.2%

Fastenal Co. (d)

42,000

1,393,140

W.W. Grainger, Inc.

77,300

6,329,324

 

7,722,464

TOTAL INDUSTRIALS

332,849,672

INFORMATION TECHNOLOGY - 33.7%

Communications Equipment - 9.8%

Cisco Systems, Inc. (a)

7,474,899

139,332,121

Juniper Networks, Inc. (a)

1,807,031

42,645,932

QUALCOMM, Inc.

2,734,153

123,583,716

Riverbed Technology, Inc. (a)

352,400

8,172,156

 

313,733,925

Computers & Peripherals - 2.3%

Apple, Inc. (a)

444,986

63,379,356

Intermec, Inc. (a)

582,486

7,514,069

Netezza Corp. (a)

226,100

1,881,152

 

72,774,577

Electronic Equipment & Components - 1.1%

BYD Co. Ltd. (H Shares) (a)

982,500

3,892,018

Corning, Inc.

1,862,200

29,906,932

 

33,798,950

Internet Software & Services - 5.1%

Baidu.com, Inc. sponsored ADR (a)

33,600

10,116,624

Google, Inc. Class A (sub. vtg.) (a)

239,915

101,145,765

Tencent Holdings Ltd.

190,000

2,217,512

The Knot, Inc. (a)

844,315

6,653,202

VeriSign, Inc. (a)

2,374,679

43,884,068

 

164,017,171

IT Services - 3.9%

Accenture Ltd. Class A

639,100

21,384,286

Cognizant Technology Solutions Corp. Class A (a)

125,233

3,343,721

Fidelity National Information Services, Inc.

1,907,003

38,063,780

Metavante Technologies, Inc. (a)

486,431

12,579,106

The Western Union Co.

916,482

15,030,305

Visa, Inc.

521,993

32,499,284

 

122,900,482

Semiconductors & Semiconductor Equipment - 6.7%

Analog Devices, Inc.

749,336

18,568,546

Applied Materials, Inc.

1,305,452

14,320,808

ASML Holding NV (NY Shares)

777,300

16,828,545

Atmel Corp. (a)

4,078,959

15,214,517

Broadcom Corp. Class A (a)

2,416,967

59,916,612

 

Shares

Value

Marvell Technology Group Ltd. (a)

3,469,434

$ 40,384,212

Maxim Integrated Products, Inc.

853,100

13,385,139

Monolithic Power Systems, Inc. (a)

805,501

18,051,277

National Semiconductor Corp.

1,421,417

17,838,783

 

214,508,439

Software - 4.8%

Autonomy Corp. PLC (a)

69,807

1,650,294

BMC Software, Inc. (a)

805,761

27,226,664

Intuit, Inc. (a)

284,000

7,997,440

Microsoft Corp.

796,400

18,930,428

Oracle Corp.

2,421,100

51,859,962

Salesforce.com, Inc. (a)

12,065

460,521

Shanda Interactive Entertainment Ltd. sponsored ADR (a)

384,900

20,126,421

Sourcefire, Inc. (a)

225,868

2,798,505

VanceInfo Technologies, Inc. ADR (a)

1,422,630

21,012,245

 

152,062,480

TOTAL INFORMATION TECHNOLOGY

 

1,073,796,024

MATERIALS - 1.9%

Chemicals - 1.9%

Air Products & Chemicals, Inc.

252,900

16,334,811

Ecolab, Inc.

263,600

10,277,764

FMC Corp.

219,000

10,358,700

Praxair, Inc.

88,000

6,254,160

Terra Industries, Inc.

465,700

11,279,254

The Mosaic Co.

144,400

6,396,920

 

60,901,609

TELECOMMUNICATION SERVICES - 0.7%

Diversified Telecommunication Services - 0.1%

Neutral Tandem, Inc. (a)

160,884

4,749,296

Wireless Telecommunication Services - 0.6%

American Tower Corp. Class A (a)

575,306

18,139,398

TOTAL TELECOMMUNICATION SERVICES

22,888,694

TOTAL COMMON STOCKS

(Cost $3,296,805,780)

3,145,469,185

Money Market Funds - 2.2%

Shares

Value

Fidelity Cash Central Fund, 0.40% (b)

37,999,948

$ 37,999,948

Fidelity Securities Lending Cash Central Fund, 0.22% (b)(c)

31,019,250

31,019,250

TOTAL MONEY MARKET FUNDS

(Cost $69,019,198)

69,019,198

TOTAL INVESTMENT PORTFOLIO - 100.8%

(Cost $3,365,824,978)

3,214,488,383

NET OTHER ASSETS - (0.8)%

(24,980,187)

NET ASSETS - 100%

$ 3,189,508,196

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 unaudited listing of the fund's holdings as of its most recent quarter end is available upon request.

(c) Investment made with cash collateral received from securities on loan.

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

Affiliated Central Funds

Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:

Fund

Income earned

Fidelity Cash Central Fund

$ 330,396

Fidelity Securities Lending Cash Central Fund

409,143

Total

$ 739,539

Other Information

All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, please refer to the Security Valuation section in the accompanying Notes to Financial Statements.

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

United States of America

88.5%

Bermuda

2.3%

Switzerland

2.1%

Netherlands Antilles

1.6%

China

1.0%

Ireland

1.0%

Denmark

1.0%

Israel

1.0%

Others (individually less than 1%)

1.5%

 

100.0%

Income Tax Information

At December 31, 2008, the fund had a capital loss carryforward of approximately $1,490,706,279 of which $351,276,710, $44,707,854 and $1,094,721,715 will expire on December 31, 2010, 2011 and 2016, respectively.

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

Semiannual Report

Financial Statements

Statement of Assets and Liabilities

 

June 30, 2009 (Unaudited)

 

 

 

Assets

Investment in securities, at value (including securities loaned of $30,308,345) - See accompanying schedule:

Unaffiliated issuers (cost $3,296,805,780)

$ 3,145,469,185

 

Fidelity Central Funds (cost $69,019,198)

69,019,198

 

Total Investments (cost $3,365,824,978)

 

$ 3,214,488,383

Receivable for investments sold

43,646,102

Receivable for fund shares sold

630,663

Dividends receivable

1,533,010

Distributions receivable from Fidelity Central Funds

27,610

Prepaid expenses

21,046

Other receivables

426,806

Total assets

3,260,773,620

 

 

 

Liabilities

Payable to custodian bank

$ 63,792

Payable for investments purchased

36,098,766

Payable for fund shares redeemed

1,858,664

Accrued management fee

1,524,728

Distribution fees payable

129,208

Other affiliated payables

268,727

Other payables and accrued expenses

302,289

Collateral on securities loaned, at value

31,019,250

Total liabilities

71,265,424

 

 

 

Net Assets

$ 3,189,508,196

Net Assets consist of:

 

Paid in capital

$ 5,404,089,877

Undistributed net investment income

8,979,079

Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions

(2,072,226,206)

Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies

(151,334,554)

Net Assets

$ 3,189,508,196

Statement of Assets and Liabilities - continued

 

June 30, 2009 (Unaudited)

 

 

 

Initial Class:
Net Asset Value, offering price and redemption price per share ($2,277,498,844 ÷ 92,704,994 shares)

$ 24.57

 

 

 

Service Class:
Net Asset Value, offering price and redemption price per share ($376,693,170 ÷ 15,377,682 shares)

$ 24.50

 

 

 

Service Class 2:
Net Asset Value, offering price and redemption price per share ($449,994,387 ÷ 18,509,595 shares)

$ 24.31

 

 

 

Service Class 2R:
Net Asset Value, offering price and redemption price per share ($4,064,164 ÷ 167,528 shares)

$ 24.26

 

 

 

Investor Class:
Net Asset Value, offering price and redemption price per share ($81,257,631 ÷ 3,316,328 shares)

$ 24.50

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

Semiannual Report

Statement of Operations

Six months ended June 30, 2009 (Unaudited)

 

 

 

Investment Income

 

 

Dividends

 

$ 20,334,582

Interest

 

874

Income from Fidelity Central Funds

 

739,539

Total income

 

21,074,995

 

 

 

Expenses

Management fee

$ 8,670,582

Transfer agent fees

1,372,985

Distribution fees

727,603

Accounting and security lending fees

472,330

Custodian fees and expenses

10,053

Independent trustees' compensation

12,477

Appreciation in deferred trustee compensation account

51

Audit

36,768

Legal

4,065

Miscellaneous

143,195

Total expenses before reductions

11,450,109

Expense reductions

(37,483)

11,412,626

 

 

 

Net investment income (loss)

9,662,369

Realized and Unrealized Gain (Loss)

Net realized gain (loss) on:

Investment securities:

 

 

Unaffiliated issuers

(541,500,445)

Foreign currency transactions

(131,524)

Total net realized gain (loss)

 

(541,631,969)

Change in net unrealized appreciation (depreciation) on:

Investment securities

655,346,652

Assets and liabilities in foreign currencies

2,968

Total change in net unrealized appreciation (depreciation)

 

655,349,620

Net gain (loss)

113,717,651

Net increase (decrease) in net assets resulting from operations

$ 123,380,020

Statement of Changes in Net Assets

 

Six months ended
June 30, 2009
(Unaudited)

Year ended
December 31,
2008

Increase (Decrease) in Net Assets

 

 

Operations

 

 

Net investment income (loss)

$ 9,662,369

$ 39,362,868

Net realized gain (loss)

(541,631,969)

(1,127,004,570)

Change in net unrealized appreciation (depreciation)

655,349,620

(2,110,579,825)

Net increase (decrease) in net assets resulting from operations

123,380,020

(3,198,221,527)

Distributions to shareholders from net investment income

(548,000)

(39,588,806)

Distributions to shareholders from net realized gain

(410,999)

-

Total distributions

(958,999)

(39,588,806)

Share transactions - net increase (decrease)

(210,584,035)

(1,517,000,817)

Redemption fees

593

17,837

Total increase (decrease) in net assets

(88,162,421)

(4,754,793,313)

 

 

 

Net Assets

Beginning of period

3,277,670,617

8,032,463,930

End of period (including undistributed net investment income of $8,979,079 and distributions in excess of net investment income of $135,290, respectively)

$ 3,189,508,196

$ 3,277,670,617

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

Semiannual Report

Financial Highlights - Initial Class

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 23.53

$ 45.12

$ 35.87

$ 33.70

$ 32.01

$ 31.04

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .08

.27

.09

.21

.11

.15 H, K

Net realized and unrealized gain (loss)

  .97

(21.55)

9.53

2.09

1.74

.90

Total from investment operations

  1.05

(21.28)

9.62

2.30

1.85

1.05

Distributions from net investment income

  - J

(.31)

(.33)

(.13)

(.16)

(.08)

Distributions from net realized gain

  - J

-

(.04)

-

-

-

Total distributions

  (.01) L

(.31)

(.37)

(.13)

(.16)

(.08)

Redemption fees added to paid in capital E, J

  -

-

-

-

-

-

Net asset value, end of period

$ 24.57

$ 23.53

$ 45.12

$ 35.87

$ 33.70

$ 32.01

Total Return B, C, D

  4.45%

(47.17)%

26.96%

6.85%

5.80%

3.38%

Ratios to Average Net Assets F,I

 

 

 

 

 

 

Expenses before reductions

  .70% A

.68%

.65%

.68%

.67%

.68%

Expenses net of fee waivers, if any

  .70% A

.68%

.65%

.68%

.67%

.68%

Expenses net of all reductions

  .69% A

.67%

.64%

.67%

.63%

.65%

Net investment income (loss)

  .68% A

.74%

.21%

.61%

.36%

.47% K

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 2,277,499

$ 2,337,892

$ 6,002,656

$ 5,610,629

$ 6,726,655

$ 7,796,888

Portfolio turnover rate G

  172% A

161%

109%

114%

79%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H Investment income per share reflects a special dividend which amounted to $.08 per share. I 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 fee 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. J Amount represents less than $.01 per share. K As a result in the change in the estimate of the return of capital components of dividend 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 class. L Total distributions of $.007 per share is comprised of distributions from net investment income of $.004 and distributions from net realized gain of $.003 per share.

Financial Highlights - Service Class

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 23.47

$ 44.99

$ 35.72

$ 33.56

$ 31.88

$ 30.92

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .07

.23

.04

.18

.08

.11 H, K

Net realized and unrealized gain (loss)

  .97

(21.48)

9.51

2.07

1.72

.90

Total from investment operations

  1.04

(21.25)

9.55

2.25

1.80

1.01

Distributions from net investment income

  - J

(.27)

(.24)

(.09)

(.12)

(.05)

Distributions from net realized gain

  - J

-

(.04)

-

-

-

Total distributions

  (.01) L

(.27)

(.28)

(.09)

(.12)

(.05)

Redemption fees added to paid in capital E, J

  -

-

-

-

-

-

Net asset value, end of period

$ 24.50

$ 23.47

$ 44.99

$ 35.72

$ 33.56

$ 31.88

Total Return B, C, D

  4.42%

(47.23)%

26.87%

6.73%

5.67%

3.26%

Ratios to Average Net Assets F, I

 

 

 

 

 

 

Expenses before reductions

  .80% A

.78%

.75%

.78%

.77%

.78%

Expenses net of fee waivers, if any

  .80% A

.78%

.75%

.78%

.77%

.78%

Expenses net of all reductions

  .79% A

.77%

.74%

.77%

.73%

.75%

Net investment income (loss)

  .58% A

.64%

.11%

.51%

.26%

.37% K

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 376,693

$ 395,759

$ 929,848

$ 877,279

$ 1,086,172

$ 1,326,262

Portfolio turnover rate G

  172% A

161%

109%

114%

79%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H Investment income per share reflects a special dividend which amounted to $.08 per share. I 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 fee 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. J Amount represents less than $.01 per share. K As a result in the change in the estimate of the return of capital components of dividend 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 class. L Total distributions of $.007 per share is comprised of distributions from net investment income of $.004 and distributions from net realized gain of $.003 per share.

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

Semiannual Report

Financial Highlights - Service Class 2

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 23.31

$ 44.65

$ 35.42

$ 33.29

$ 31.64

$ 30.72

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .05

.17

(.02)

.12

.03

.07 H, K

Net realized and unrealized gain (loss)

  .96

(21.29)

9.43

2.07

1.71

.89

Total from investment operations

  1.01

(21.12)

9.41

2.19

1.74

.96

Distributions from net investment income

  - J

(.22)

(.15)

(.06)

(.09)

(.04)

Distributions from net realized gain

  - J

-

(.03)

-

-

-

Total distributions

  (.01) L

(.22)

(.18)

(.06)

(.09)

(.04)

Redemption fees added to paid in capital E, J

  -

-

-

-

-

-

Net asset value, end of period

$ 24.31

$ 23.31

$ 44.65

$ 35.42

$ 33.29

$ 31.64

Total Return B, C, D

  4.32%

(47.31)%

26.66%

6.57%

5.50%

3.12%

Ratios to Average Net Assets F, I

 

 

 

 

 

 

Expenses before reductions

  .95% A

.93%

.90%

.94%

.92%

.93%

Expenses net of fee waivers, if any

  .95% A

.93%

.90%

.94%

.92%

.93%

Expenses net of all reductions

  .95% A

.92%

.89%

.92%

.88%

.90%

Net investment income (loss)

  .43% A

.49%

(.04)%

.36%

.11%

.22% K

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 449,994

$ 447,530

$ 898,204

$ 627,754

$ 858,587

$ 811,126

Portfolio turnover rate G

  172% A

161%

109%

114%

79%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H Investment income per share reflects a special dividend which amounted to $.08 per share. I 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 fee 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. J Amount represents less than $.01 per share. K As a result in the change in the estimate of the return of capital components of dividend 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 class. L Total distributions of $.007 per share is comprised of distributions from net investment income of $.004 and distributions from net realized gain of $.003 per share.

Financial Highlights - Service Class 2R

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 23.26

$ 44.42

$ 35.28

$ 33.18

$ 31.54

$ 30.65

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .05

.18

(.01)

.12

.04

.07 H, K

Net realized and unrealized gain (loss)

  .96

(21.20)

9.38

2.06

1.70

.88

Total from investment operations

  1.01

(21.02)

9.37

2.18

1.74

.95

Distributions from net investment income

  - J

(.14)

(.19)

(.08)

(.10)

(.06)

Distributions from net realized gain

  - J

-

(.04)

-

-

-

Total distributions

  (.01) L

(.14)

(.23)

(.08)

(.10)

(.06)

Redemption fees added to paid in capital E, J

  -

-

-

-

-

-

Net asset value, end of period

$ 24.26

$ 23.26

$ 44.42

$ 35.28

$ 33.18

$ 31.54

Total Return B, C, D

  4.33%

(47.31)%

26.66%

6.58%

5.52%

3.10%

Ratios to Average Net Assets F, I

 

 

 

 

 

 

Expenses before reductions

  .94% A

.93%

.89%

.93%

.92%

.93%

Expenses net of fee waivers, if any

  .94% A

.93%

.89%

.93%

.92%

.93%

Expenses net of all reductions

  .94% A

.92%

.89%

.92%

.88%

.90%

Net investment income (loss)

  .43% A

.49%

(.04)%

.36%

.12%

.22% K

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 4,064

$ 3,061

$ 20,051

$ 5,063

$ 5,409

$ 2,667

Portfolio turnover rate G

  172% A

161%

109%

114%

79%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H Investment income per share reflects a special dividend which amounted to $.08 per share. I 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 fee 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. J Amount represents less than $.01 per share. K As a result in the change in the estimate of the return of capital components of dividend 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 class. L Total distributions of $.007 per share is comprised of distributions from net investment income of $.004 and distributions from net realized gain of $.003 per share.

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

Semiannual Report

Financial Highlights - Investor Class

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005 H

Selected Per-Share Data

 

 

 

 

 

Net asset value, beginning of period

$ 23.48

$ 45.00

$ 35.78

$ 33.67

$ 32.60

Income from Investment Operations

 

 

 

 

 

Net investment income (loss) E

  .06

.24

.04

.17

.03

Net realized and unrealized gain (loss)

  .97

(21.49)

9.50

2.08

1.04

Total from investment operations

  1.03

(21.25)

9.54

2.25

1.07

Distributions from net investment income

  - J

(.27)

(.28)

(.14)

-

Distributions from net realized gain

  - J

-

(.04)

-

-

Total distributions

  (.01) K

(.27)

(.32)

(.14)

-

Redemption fees added to paid in capital E, J

  -

-

-

-

-

Net asset value, end of period

$ 24.50

$ 23.48

$ 45.00

$ 35.78

$ 33.67

Total Return B, C, D

  4.38%

(47.22)%

26.81%

6.72%

3.28%

Ratios to Average Net Assets F, I

 

 

 

 

 

Expenses before reductions

  .81% A

.77%

.76%

.81%

.83% A

Expenses net of fee waivers, if any

  .81% A

.77%

.76%

.81%

.83% A

Expenses net of all reductions

  .81% A

.76%

.76%

.80%

.79% A

Net investment income (loss)

  .57% A

.65%

.09%

.49%

.23% A

Supplemental Data

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 81,258

$ 93,428

$ 181,705

$ 76,965

$ 24,166

Portfolio turnover rate G

  172% A

161%

109%

114%

79%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H For the period July 21, 2005 (commencement of sale of shares) to December 31, 2005. I 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 fee 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. J Amount represents less than $.01 per share. K Total distributions of $.007 per share is comprised of distributions from net investment income of $.004 and distributions from net realized gain of $.003 per share.

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

Semiannual Report

Notes to Financial Statements

For the period ended June 30, 2009 (Unaudited)

1. Organization.

VIP Growth Portfolio (the Fund) is a fund of Variable Insurance Products Fund (the trust) and is authorized to issue an unlimited number of shares. The trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. Shares of the Fund may only be purchased by insurance companies for the purpose of funding variable annuity or variable life insurance contracts. The Fund offers the following classes of shares: Initial Class shares, Service Class shares, Service Class 2 shares, Service Class 2R shares and Investor Class 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 transfer agent and distribution and service plan fees incurred. Certain expense reductions also differ by class.

2. Investments in Fidelity Central Funds.

The Fund may invest in Fidelity Central Funds, which are open-end investment companies available only to other investment companies and accounts managed by Fidelity Management & Research Company (FMR) and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.

The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of FMR.

A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the SEC's web site at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC's web site or upon request.

3. Significant Accounting Policies.

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. Actual results could differ from those estimates. Events or transactions occurring after period end through the date that the financial statements were issued, August 10, 2009, have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:

Security Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Fund uses independent pricing services approved by the Board of Trustees to value its investments. Generally Accepted Accounting Principles (GAAP) establishes a disclosure hierarchy that categorizes the inputs to valuation techniques used to value assets and liabilities at measurement date. These inputs are classified into three levels. Level 1 includes readily available unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 includes observable inputs other than quoted prices included in Level 1 that are observable either directly or indirectly. Level 3 includes unobservable inputs when market prices are not readily available or reliable. Changes in valuation techniques may result in transfers in or out of an investment's assigned level within the hierarchy. The aggregate value by input level, as of June 30, 2009, for the Fund's investments is included at the end of the Fund's Schedule of Investments. Valuation techniques of the Fund's major categories of assets and liabilities as presented in the Schedule of Investments are as follows.

Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by an independent pricing service on the primary market or exchange on which they are traded. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price. Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value each business day. Short-term securities with remaining maturities of sixty days or less for which quotations are not readily available are valued at amortized cost, which approximates value.

When current market prices or quotations are not readily available or reliable, valuations may be determined in good faith in accordance with procedures adopted by the Board of Trustees. Factors used in determining value may include significant market or security specific events, changes in interest rates and credit quality, and developments in foreign markets which are monitored by evaluating the performance of ADRs, futures contracts and exchange-traded funds. The frequency with which these procedures are used cannot be predicted and may be utilized to a significant extent. The value of securities used for net asset value (NAV) calculation under these procedures may differ from published prices for the same securities.

Foreign Currency. The Fund uses 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.

Semiannual Report

Notes to Financial Statements (Unaudited) - continued

3. Significant Accounting Policies - continued

Investment Transactions and Income. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. 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 Fund is 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 Fund estimates the components of distributions received that may be considered return of capital distributions or capital gain distributions. Interest income and distributions from the Fidelity Central Funds are accrued as earned. Interest income includes coupon interest and amortization of premium and accretion of discount on debt securities. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.

Expenses. Most expenses of the trust can be directly attributed to a fund. Expenses which cannot be directly attributed are apportioned among each Fund in the trust. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.

Deferred Trustee Compensation. Under a Deferred Compensation Plan (the Plan), independent 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 invested in a cross-section of Fidelity funds, are marked-to-market and remain in the Fund until distributed in accordance with the Plan. The investment of deferred amounts and the offsetting payable to the Trustees are included in the accompanying Statement of Assets and Liabilities.

Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company by distributing substantially all of its taxable income and realized gains under Subchapter M of the Internal Revenue Code and filing its U.S. federal tax return. As a result, no provision for income taxes is required. The Fund is subject to the provisions of FASB Interpretation No. 48, Accounting for Uncertainties in Income Taxes (FIN 48). FIN 48 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. There are no unrecognized tax benefits in the accompanying financial statements. A Fund's federal tax return is subject to examination by the Internal Revenue Service (IRS) for a period of three years. Foreign taxes are provided for based on the 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 short-term gain distributions from the underlying funds, futures transactions, foreign currency transactions, partnerships (including allocations from Fidelity Central Funds), deferred trustees compensation, capital loss carryforwards and losses deferred due to wash sales.

The federal tax cost of investments and unrealized appreciation (depreciation) as of period end were as follows:

Unrealized appreciation

$ 198,400,031

Unrealized depreciation

(382,293,768)

Net unrealized appreciation (depreciation)

$ (183,893,737)

Cost for federal income tax purposes

$ 3,398,382,120

Trading (Redemption) Fees. 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 Fund and accounted for as an addition to paid in capital.

4. Purchases and Sales of Investments.

Purchases and sales of securities, other than short-term securities, aggregated $2,607,977,191 and $2,564,665,640, respectively.

5. Fees and Other Transactions with Affiliates.

Management Fee. FMR and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .30% of the Fund's average net assets and a group fee rate that averaged .27% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by FMR.

Semiannual Report

5. Fees and Other Transactions with Affiliates - continued

Management Fee - continued

The group fee rate decreases as assets under management increase and increases as assets under management decrease. For the period, the total annualized management fee rate was .57% of the Fund's average net assets.

Distribution and Service Plan. In accordance with Rule 12b-1 of the 1940 Act, the Fund has 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 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

$ 182,677

Service Class 2

540,058

Service Class 2 R

4,868

 

$ 727,603

Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc. (FIIOC), an affiliate of FMR, is the Fund's transfer, dividend disbursing, and shareholder servicing agent. FIIOC receives an asset-based fee with respect to each class. Each class (with the exception of Investor Class) pays a transfer agent fee, excluding out of pocket expenses, equal to an annual rate of .07% of average net assets. Investor Class pays a monthly asset-based transfer agent fee of .15% of average net assets. The total transfer agent fees paid by each class to FIIOC, including out of pocket expenses, were as follows:

Initial Class

$ 940,726

Service Class

158,564

Service Class 2

189,780

Service Class 2R

1,625

Investor Class

82,290

 

$ 1,372,985

Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of FMR, maintains the 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.

Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. The commissions paid to these affiliated firms were $66,044 for the period.

6. Committed Line of Credit.

The Fund participates with other funds managed by FMR in a $3.5 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 Fund has agreed to pay commitment fees on its pro-rata portion of the line of credit, which amounted to $9,947 and is reflected in Miscellaneous Expense on the Statement of Operations. During the period, there were no borrowings on this line of credit.

7. Security Lending.

The Fund lends portfolio securities from time to time in order to earn additional income. On the settlement date of the loan, the 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 Fund and any additional required collateral is delivered to the Fund 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. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. Security lending income represents the income earned on investing cash collateral, less fees and expenses associated with the loan, plus any premium payments that may be received on the loan of certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds. Net income from lending portfolio securities during the period amounted to $409,143.

Semiannual Report

Notes to Financial Statements (Unaudited) - continued

8. Expense Reductions.

Many of the brokers with whom FMR places trades on behalf of the Fund provided services to the Fund in addition to trade execution. These services included payments of certain expenses on behalf of the Fund totaling $36,840 for the period. In addition, through arrangements with the Fund's custodian, credits realized as a result of uninvested cash balances were used to reduce the Fund's expenses. During the period, these credits reduced the Fund's custody expenses by $643.

9. Distributions to Shareholders.

Distributions to shareholders of each class were as follows:

 

Six months ended
June 30, 2009

Year ended
December 31, 2008

From net investment income

 

 

Initial Class

$ 389,093

$ 29,994,939

Service Class

65,926

4,447,535

Service Class 2

76,993

4,070,779

Service Class 2R

707

18,979

Investor Class

15,281

1,056,574

Total

$ 548,000

$ 39,588,806

From net realized gain

 

 

Initial Class

$ 291,821

$ -

Service Class

49,445

-

Service Class 2

57,745

-

Service Class 2R

531

-

Investor Class

11,457

-

Total

$ 410,999

$ -

10. Share Transactions.

Transactions for each class of shares were as follows:

 

Shares

Dollars

Six months ended
June 30, 2009

Year ended
December 31, 2008

Six months ended
June 30, 2009

Year ended
December 31, 2008

Initial Class

 

 

 

 

Shares sold

1,726,400

3,905,978

$ 39,797,260

$ 138,026,441

Reinvestment of distributions

30,480

1,288,996

680,914

29,994,938

Shares redeemed

(8,413,248)

(38,869,099)

(188,311,875)

(1,490,052,456)

Net increase (decrease)

(6,656,368)

(33,674,125)

$ (147,833,701)

$ (1,322,031,077)

Service Class

 

 

 

 

Shares sold

330,392

1,299,183

$ 7,500,653

$ 44,341,627

Reinvestment of distributions

5,178

191,539

115,371

4,447,535

Shares redeemed

(1,818,080)

(5,299,957)

(40,610,682)

(193,461,539)

Net increase (decrease)

(1,482,510)

(3,809,235)

$ (32,994,658)

$ (144,672,377)

Service Class 2

 

 

 

 

Shares sold

1,804,846

4,426,611

$ 39,916,662

$ 159,010,524

Reinvestment of distributions

6,091

176,530

134,738

4,070,779

Shares redeemed

(2,497,375)

(5,522,476)

(55,816,320)

(198,453,754)

Net increase (decrease)

(686,438)

(919,335)

$ (15,764,920)

$ (35,372,451)

Service Class 2R

 

 

 

 

Shares sold

54,755

101,959

$ 1,295,791

$ 4,039,975

Reinvestment of distributions

56

825

1,238

18,979

Shares redeemed

(18,875)

(422,581)

(414,695)

(16,348,368)

Net increase (decrease)

35,936

(319,797)

$ 882,334

$ (12,289,414)

Investor Class

 

 

 

 

Shares sold

128,074

2,298,287

$ 2,942,543

$ 86,244,669

Reinvestment of distributions

1,200

45,483

26,738

1,056,574

Shares redeemed

(791,930)

(2,402,506)

(17,842,371)

(89,936,741)

Net increase (decrease)

(662,656)

(58,736)

$ (14,873,090)

$ (2,635,498)

Semiannual Report

11. Other.

The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund's maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

At the end of the period, FMR or its affiliates were the owners of record of 15% of the total outstanding shares of the Fund and two otherwise unaffiliated shareholders were the owners of record of 36% of the total outstanding shares of the Fund.

Semiannual Report

Investment Adviser

Fidelity Management & Research Company
Boston, MA

Investment Sub-Adviser

FMR Co., Inc.

Fidelity Management & Research (U.K.) Inc.

Fidelity Management & Research (Hong Kong) Limited

Fidelity Management & Research (Japan) Inc.

Fidelity Research & Analysis Company

FIL Investment Advisors

FIL Investment Advisors (U.K.) Ltd.

Fidelity Investments Japan Limited

General Distributor

Fidelity Distributors Corporation
Boston, MA

Transfer and Service Agents

Fidelity Investments Institutional Operations Company, Inc.
Boston, MA 

Fidelity Service Company, Inc.
Boston, MA 

Custodian

The Bank of New York Mellon
New York, NY 

VIPGRWT-SANN-0809
1.705692.111

Fidelity® Variable Insurance Products:
Growth Portfolio - Service Class 2R

Semiannual Report

June 30, 2009

(2_fidelity_logos) (Registered_Trademark)

Contents

Shareholder Expense Example

<Click Here>

An example of shareholder expenses.

Investment Changes

<Click Here>

A summary of major shifts in the fund's investments over the past six months.

Investments

<Click Here>

A complete list of the fund's investments with their market values.

Financial Statements

<Click Here>

Statements of assets and liabilities, operations, and changes in net assets, as well as financial highlights.

Notes

<Click Here>

Notes to the financial statements.

To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov. You may also call 1-877-208-0098 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 LLC or an affiliated company.

This report and the financial statements contained herein are submitted for the general information of the shareholders of the fund. This report is not authorized for distribution to prospective investors in the fund 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 holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com or http://www.advisor.fidelity.com, as applicable.

NOT FDIC INSURED · MAY LOSE VALUE · NO BANK GUARANTEE

Neither the fund nor Fidelity Distributors Corporation is a bank.

Semiannual Report

Shareholder Expense Example

As a shareholder of the 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 Fund 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 (January 1, 2009 to June 30, 2009).

Actual Expenses

The first line of the accompanying table for each class of the 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. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.

Hypothetical Example for Comparison Purposes

The second line of the accompanying table for each class of the 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. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.

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.

 



Annualized
Expense Ratio


Beginning
Account Value
January 1, 2009


Ending
Account Value
June 30, 2009

Expenses Paid
During Period*
January 1, 2009
to June 30, 2009

Initial Class

.70%

 

 

 

Actual

 

$ 1,000.00

$ 1,044.50

$ 3.55

Hypothetical A

 

$ 1,000.00

$ 1,021.32

$ 3.51

Service Class

.80%

 

 

 

Actual

 

$ 1,000.00

$ 1,044.20

$ 4.05

Hypothetical A

 

$ 1,000.00

$ 1,020.83

$ 4.01

Service Class 2

.95%

 

 

 

Actual

 

$ 1,000.00

$ 1,043.20

$ 4.81

Hypothetical A

 

$ 1,000.00

$ 1,020.08

$ 4.76

Service Class 2R

.94%

 

 

 

Actual

 

$ 1,000.00

$ 1,043.30

$ 4.76

Hypothetical A

 

$ 1,000.00

$ 1,020.13

$ 4.71

Investor Class

.81%

 

 

 

Actual

 

$ 1,000.00

$ 1,043.80

$ 4.10

Hypothetical A

 

$ 1,000.00

$ 1,020.78

$ 4.06

A 5% return per year before expenses

* Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).

Semiannual Report

Investment Changes (Unaudited)

Top Ten Stocks as of June 30, 2009

 

% of fund's
net assets

% of fund's net assets
6 months ago

Cisco Systems, Inc.

4.4

2.8

QUALCOMM, Inc.

3.9

3.8

JPMorgan Chase & Co.

3.6

2.1

Google, Inc. Class A (sub. vtg.)

3.2

2.1

Wells Fargo & Co.

2.8

6.6

Medco Health Solutions, Inc.

2.5

4.9

Lowe's Companies, Inc.

2.1

0.2

Target Corp.

2.0

0.0

Apple, Inc.

2.0

0.8

Broadcom Corp. Class A

1.9

0.0

 

28.4

Top Five Market Sectors as of June 30, 2009

 

% of fund's
net assets

% of fund's net assets
6 months ago

Information Technology

33.7

24.5

Consumer Discretionary

14.8

4.7

Financials

13.0

22.9

Health Care

12.5

20.2

Industrials

10.4

3.3

Asset Allocation (% of fund's net assets)

As of June 30, 2009*

As of December 31, 2008**

fid4705

Stocks 98.6%

 

fid4705

Stocks 91.4%

 

fid4711

Short-Term
Investments and
Net Other Assets 1.4%

 

fid4711

Short-Term
Investments and
Net Other Assets 8.6%

 

* Foreign investments

11.5%

 

** Foreign investments

12.9%

 


fid4749

Semiannual Report

Investments June 30, 2009 (Unaudited)

Showing Percentage of Net Assets

Common Stocks - 98.6%

Shares

Value

CONSUMER DISCRETIONARY - 14.8%

Auto Components - 0.4%

Autoliv, Inc.

131,800

$ 3,791,886

BorgWarner, Inc.

163,100

5,569,865

Johnson Controls, Inc.

161,700

3,512,124

 

12,873,875

Automobiles - 0.4%

Harley-Davidson, Inc. (d)

854,900

13,857,929

Diversified Consumer Services - 1.2%

Strayer Education, Inc. (d)

180,520

39,373,217

Hotels, Restaurants & Leisure - 2.6%

Chipotle Mexican Grill, Inc. Class B (a)

13,893

969,592

Marriott International, Inc. Class A

183,976

4,060,350

McDonald's Corp.

666,476

38,315,705

Starbucks Corp. (a)

2,580,973

35,849,715

Starwood Hotels & Resorts Worldwide, Inc.

129,600

2,877,120

 

82,072,482

Household Durables - 0.9%

Black & Decker Corp.

315,913

9,054,067

Mohawk Industries, Inc. (a)

507,899

18,121,836

 

27,175,903

Media - 0.5%

McGraw-Hill Companies, Inc.

152,910

4,604,120

The DIRECTV Group, Inc. (a)

427,800

10,570,938

 

15,175,058

Multiline Retail - 2.0%

Target Corp.

1,612,324

63,638,428

Specialty Retail - 5.7%

Advance Auto Parts, Inc.

179,400

7,443,306

Best Buy Co., Inc.

646,915

21,665,183

DSW, Inc. Class A (a)(d)

160,728

1,583,171

Home Depot, Inc.

521,200

12,315,956

Lowe's Companies, Inc.

3,457,391

67,107,959

O'Reilly Automotive, Inc. (a)

602,998

22,962,164

Ross Stores, Inc.

261,135

10,079,811

Sherwin-Williams Co.

316,746

17,025,098

Tiffany & Co., Inc.

114,214

2,896,467

TJX Companies, Inc.

564,506

17,759,359

 

180,838,474

Textiles, Apparel & Luxury Goods - 1.1%

Coach, Inc.

563,800

15,154,944

Lululemon Athletica, Inc. (a)

629,600

8,203,688

NIKE, Inc. Class B

247,500

12,815,550

 

36,174,182

TOTAL CONSUMER DISCRETIONARY

471,179,548

 

Shares

Value

CONSUMER STAPLES - 5.9%

Beverages - 1.2%

Anheuser-Busch InBev NV

144,300

$ 5,210,023

The Coca-Cola Co.

682,841

32,769,540

 

37,979,563

Food & Staples Retailing - 0.6%

Costco Wholesale Corp.

198,700

9,080,590

Wal-Mart Stores, Inc.

231,302

11,204,269

 

20,284,859

Food Products - 1.3%

Nestle SA sponsored ADR

1,067,250

40,149,945

Household Products - 1.6%

Colgate-Palmolive Co.

337,510

23,875,457

Energizer Holdings, Inc. (a)

527,969

27,581,101

 

51,456,558

Personal Products - 0.8%

Estee Lauder Companies, Inc. Class A

505,020

16,499,003

Mead Johnson Nutrition Co. Class A

184,712

5,868,300

Nu Skin Enterprises, Inc. Class A

261,348

3,998,624

 

26,365,927

Tobacco - 0.4%

Philip Morris International, Inc.

299,200

13,051,104

TOTAL CONSUMER STAPLES

189,287,956

ENERGY - 5.7%

Energy Equipment & Services - 2.8%

Schlumberger Ltd. (NY Shares)

917,314

49,635,861

Smith International, Inc.

492,800

12,689,600

Weatherford International Ltd. (a)

1,320,000

25,819,200

 

88,144,661

Oil, Gas & Consumable Fuels - 2.9%

Denbury Resources, Inc. (a)

2,128,950

31,359,434

Range Resources Corp.

525,923

21,778,471

Southwestern Energy Co. (a)

997,074

38,736,325

 

91,874,230

TOTAL ENERGY

180,018,891

FINANCIALS - 13.0%

Capital Markets - 2.9%

Charles Schwab Corp.

1,121,346

19,668,409

Franklin Resources, Inc.

235,400

16,951,154

Goldman Sachs Group, Inc.

232,709

34,310,615

JMP Group, Inc.

138,900

1,068,141

Morgan Stanley

701,900

20,011,169

T. Rowe Price Group, Inc.

31,300

1,304,271

 

93,313,759

Common Stocks - continued

Shares

Value

FINANCIALS - continued

Commercial Banks - 4.6%

PNC Financial Services Group, Inc.

1,459,620

$ 56,647,852

Wells Fargo & Co.

3,764,373

91,323,689

 

147,971,541

Consumer Finance - 0.7%

American Express Co.

892,400

20,739,376

Diversified Financial Services - 4.0%

CME Group, Inc.

40,012

12,448,133

JPMorgan Chase & Co.

3,391,698

115,690,819

 

128,138,952

Insurance - 0.5%

MetLife, Inc.

554,541

16,641,775

Real Estate Investment Trusts - 0.0%

Simon Property Group, Inc.

1,308

67,270

Real Estate Management & Development - 0.3%

Jones Lang LaSalle, Inc.

258,700

8,467,251

TOTAL FINANCIALS

415,339,924

HEALTH CARE - 12.5%

Biotechnology - 3.6%

Alexion Pharmaceuticals, Inc. (a)

161,942

6,659,055

Biogen Idec, Inc. (a)

472,961

21,354,189

Celgene Corp. (a)

217,035

10,382,954

Dendreon Corp. (a)

208,100

5,171,285

Gilead Sciences, Inc. (a)

862,500

40,399,500

Myriad Genetics, Inc. (a)

596,368

21,260,519

Myriad Pharmaceuticals, Inc. (a)

16,392

76,223

United Therapeutics Corp. (a)

108,820

9,067,971

Vanda Pharmaceuticals, Inc. (a)

60,300

709,731

 

115,081,427

Health Care Equipment & Supplies - 2.2%

C.R. Bard, Inc.

57,800

4,303,210

Covidien PLC

461,796

17,289,642

DENTSPLY International, Inc.

807,714

24,651,431

Edwards Lifesciences Corp. (a)

47,300

3,217,819

Integra LifeSciences Holdings Corp. (a)

132,700

3,517,877

NuVasive, Inc. (a)

395,251

17,628,195

Orthovita, Inc. (a)

354,500

1,825,675

 

72,433,849

Health Care Providers & Services - 3.7%

Express Scripts, Inc. (a)

407,405

28,009,094

Henry Schein, Inc. (a)

212,819

10,204,671

Medco Health Solutions, Inc. (a)

1,730,627

78,933,897

 

117,147,662

Life Sciences Tools & Services - 0.9%

Illumina, Inc. (a)

523,449

20,383,104

 

Shares

Value

Sequenom, Inc. (a)(d)

592,652

$ 2,317,269

Techne Corp.

84,165

5,370,569

 

28,070,942

Pharmaceuticals - 2.1%

Cadence Pharmaceuticals, Inc. (a)

336,388

3,360,516

Novo Nordisk AS Series B

587,569

31,766,769

Teva Pharmaceutical Industries Ltd. sponsored ADR

635,300

31,345,702

 

66,472,987

TOTAL HEALTH CARE

399,206,867

INDUSTRIALS - 10.4%

Aerospace & Defense - 1.8%

Honeywell International, Inc.

718,607

22,564,260

United Technologies Corp.

656,700

34,122,132

 

56,686,392

Air Freight & Logistics - 0.5%

United Parcel Service, Inc. Class B

319,800

15,986,802

Airlines - 0.8%

AirTran Holdings, Inc. (a)

1,576,836

9,760,615

Ryanair Holdings PLC sponsored ADR (a)

566,537

16,083,985

 

25,844,600

Building Products - 0.0%

USG Corp. (a)

100,900

1,016,063

Commercial Services & Supplies - 0.2%

Stericycle, Inc. (a)

92,300

4,756,219

Electrical Equipment - 0.6%

AMETEK, Inc.

499,100

17,258,878

Cooper Industries Ltd. Class A

103,900

3,226,095

 

20,484,973

Industrial Conglomerates - 0.3%

Textron, Inc.

1,036,520

10,012,783

Machinery - 2.9%

Cummins, Inc.

591,734

20,834,954

Danaher Corp.

619,300

38,235,582

Graco, Inc.

800,700

17,631,414

Ingersoll-Rand Co. Ltd. Class A

338,400

7,072,560

PACCAR, Inc.

293,000

9,525,430

 

93,299,940

Professional Services - 2.0%

CoStar Group, Inc. (a)

178,200

7,104,834

Dun & Bradstreet Corp.

138,139

11,218,268

Equifax, Inc.

124,000

3,236,400

FTI Consulting, Inc. (a)

468,659

23,770,384

Heidrick & Struggles International, Inc.

551,207

10,059,528

Korn/Ferry International (a)

441,766

4,700,390

Robert Half International, Inc.

125,500

2,964,310

 

63,054,114

Road & Rail - 1.1%

Heartland Express, Inc.

202,200

2,976,384

Common Stocks - continued

Shares

Value

INDUSTRIALS - continued

Road & Rail - continued

Knight Transportation, Inc.

1,090,625

$ 18,049,844

Old Dominion Freight Lines, Inc. (a)

386,032

12,959,094

 

33,985,322

Trading Companies & Distributors - 0.2%

Fastenal Co. (d)

42,000

1,393,140

W.W. Grainger, Inc.

77,300

6,329,324

 

7,722,464

TOTAL INDUSTRIALS

332,849,672

INFORMATION TECHNOLOGY - 33.7%

Communications Equipment - 9.8%

Cisco Systems, Inc. (a)

7,474,899

139,332,121

Juniper Networks, Inc. (a)

1,807,031

42,645,932

QUALCOMM, Inc.

2,734,153

123,583,716

Riverbed Technology, Inc. (a)

352,400

8,172,156

 

313,733,925

Computers & Peripherals - 2.3%

Apple, Inc. (a)

444,986

63,379,356

Intermec, Inc. (a)

582,486

7,514,069

Netezza Corp. (a)

226,100

1,881,152

 

72,774,577

Electronic Equipment & Components - 1.1%

BYD Co. Ltd. (H Shares) (a)

982,500

3,892,018

Corning, Inc.

1,862,200

29,906,932

 

33,798,950

Internet Software & Services - 5.1%

Baidu.com, Inc. sponsored ADR (a)

33,600

10,116,624

Google, Inc. Class A (sub. vtg.) (a)

239,915

101,145,765

Tencent Holdings Ltd.

190,000

2,217,512

The Knot, Inc. (a)

844,315

6,653,202

VeriSign, Inc. (a)

2,374,679

43,884,068

 

164,017,171

IT Services - 3.9%

Accenture Ltd. Class A

639,100

21,384,286

Cognizant Technology Solutions Corp. Class A (a)

125,233

3,343,721

Fidelity National Information Services, Inc.

1,907,003

38,063,780

Metavante Technologies, Inc. (a)

486,431

12,579,106

The Western Union Co.

916,482

15,030,305

Visa, Inc.

521,993

32,499,284

 

122,900,482

Semiconductors & Semiconductor Equipment - 6.7%

Analog Devices, Inc.

749,336

18,568,546

Applied Materials, Inc.

1,305,452

14,320,808

ASML Holding NV (NY Shares)

777,300

16,828,545

Atmel Corp. (a)

4,078,959

15,214,517

Broadcom Corp. Class A (a)

2,416,967

59,916,612

 

Shares

Value

Marvell Technology Group Ltd. (a)

3,469,434

$ 40,384,212

Maxim Integrated Products, Inc.

853,100

13,385,139

Monolithic Power Systems, Inc. (a)

805,501

18,051,277

National Semiconductor Corp.

1,421,417

17,838,783

 

214,508,439

Software - 4.8%

Autonomy Corp. PLC (a)

69,807

1,650,294

BMC Software, Inc. (a)

805,761

27,226,664

Intuit, Inc. (a)

284,000

7,997,440

Microsoft Corp.

796,400

18,930,428

Oracle Corp.

2,421,100

51,859,962

Salesforce.com, Inc. (a)

12,065

460,521

Shanda Interactive Entertainment Ltd. sponsored ADR (a)

384,900

20,126,421

Sourcefire, Inc. (a)

225,868

2,798,505

VanceInfo Technologies, Inc. ADR (a)

1,422,630

21,012,245

 

152,062,480

TOTAL INFORMATION TECHNOLOGY

 

1,073,796,024

MATERIALS - 1.9%

Chemicals - 1.9%

Air Products & Chemicals, Inc.

252,900

16,334,811

Ecolab, Inc.

263,600

10,277,764

FMC Corp.

219,000

10,358,700

Praxair, Inc.

88,000

6,254,160

Terra Industries, Inc.

465,700

11,279,254

The Mosaic Co.

144,400

6,396,920

 

60,901,609

TELECOMMUNICATION SERVICES - 0.7%

Diversified Telecommunication Services - 0.1%

Neutral Tandem, Inc. (a)

160,884

4,749,296

Wireless Telecommunication Services - 0.6%

American Tower Corp. Class A (a)

575,306

18,139,398

TOTAL TELECOMMUNICATION SERVICES

22,888,694

TOTAL COMMON STOCKS

(Cost $3,296,805,780)

3,145,469,185

Money Market Funds - 2.2%

Shares

Value

Fidelity Cash Central Fund, 0.40% (b)

37,999,948

$ 37,999,948

Fidelity Securities Lending Cash Central Fund, 0.22% (b)(c)

31,019,250

31,019,250

TOTAL MONEY MARKET FUNDS

(Cost $69,019,198)

69,019,198

TOTAL INVESTMENT PORTFOLIO - 100.8%

(Cost $3,365,824,978)

3,214,488,383

NET OTHER ASSETS - (0.8)%

(24,980,187)

NET ASSETS - 100%

$ 3,189,508,196

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 unaudited listing of the fund's holdings as of its most recent quarter end is available upon request.

(c) Investment made with cash collateral received from securities on loan.

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

Affiliated Central Funds

Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:

Fund

Income earned

Fidelity Cash Central Fund

$ 330,396

Fidelity Securities Lending Cash Central Fund

409,143

Total

$ 739,539

Other Information

All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, please refer to the Security Valuation section in the accompanying Notes to Financial Statements.

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

United States of America

88.5%

Bermuda

2.3%

Switzerland

2.1%

Netherlands Antilles

1.6%

China

1.0%

Ireland

1.0%

Denmark

1.0%

Israel

1.0%

Others (individually less than 1%)

1.5%

 

100.0%

Income Tax Information

At December 31, 2008, the fund had a capital loss carryforward of approximately $1,490,706,279 of which $351,276,710, $44,707,854 and $1,094,721,715 will expire on December 31, 2010, 2011 and 2016, respectively.

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

Semiannual Report

Financial Statements

Statement of Assets and Liabilities

 

June 30, 2009 (Unaudited)

 

 

 

Assets

Investment in securities, at value (including securities loaned of $30,308,345) - See accompanying schedule:

Unaffiliated issuers (cost $3,296,805,780)

$ 3,145,469,185

 

Fidelity Central Funds (cost $69,019,198)

69,019,198

 

Total Investments (cost $3,365,824,978)

 

$ 3,214,488,383

Receivable for investments sold

43,646,102

Receivable for fund shares sold

630,663

Dividends receivable

1,533,010

Distributions receivable from Fidelity Central Funds

27,610

Prepaid expenses

21,046

Other receivables

426,806

Total assets

3,260,773,620

 

 

 

Liabilities

Payable to custodian bank

$ 63,792

Payable for investments purchased

36,098,766

Payable for fund shares redeemed

1,858,664

Accrued management fee

1,524,728

Distribution fees payable

129,208

Other affiliated payables

268,727

Other payables and accrued expenses

302,289

Collateral on securities loaned, at value

31,019,250

Total liabilities

71,265,424

 

 

 

Net Assets

$ 3,189,508,196

Net Assets consist of:

 

Paid in capital

$ 5,404,089,877

Undistributed net investment income

8,979,079

Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions

(2,072,226,206)

Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies

(151,334,554)

Net Assets

$ 3,189,508,196

Statement of Assets and Liabilities - continued

 

June 30, 2009 (Unaudited)

 

 

 

Initial Class:
Net Asset Value, offering price and redemption price per share ($2,277,498,844 ÷ 92,704,994 shares)

$ 24.57

 

 

 

Service Class:
Net Asset Value, offering price and redemption price per share ($376,693,170 ÷ 15,377,682 shares)

$ 24.50

 

 

 

Service Class 2:
Net Asset Value, offering price and redemption price per share ($449,994,387 ÷ 18,509,595 shares)

$ 24.31

 

 

 

Service Class 2R:
Net Asset Value, offering price and redemption price per share ($4,064,164 ÷ 167,528 shares)

$ 24.26

 

 

 

Investor Class:
Net Asset Value, offering price and redemption price per share ($81,257,631 ÷ 3,316,328 shares)

$ 24.50

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

Semiannual Report

Statement of Operations

Six months ended June 30, 2009 (Unaudited)

 

 

 

Investment Income

 

 

Dividends

 

$ 20,334,582

Interest

 

874

Income from Fidelity Central Funds

 

739,539

Total income

 

21,074,995

 

 

 

Expenses

Management fee

$ 8,670,582

Transfer agent fees

1,372,985

Distribution fees

727,603

Accounting and security lending fees

472,330

Custodian fees and expenses

10,053

Independent trustees' compensation

12,477

Appreciation in deferred trustee compensation account

51

Audit

36,768

Legal

4,065

Miscellaneous

143,195

Total expenses before reductions

11,450,109

Expense reductions

(37,483)

11,412,626

 

 

 

Net investment income (loss)

9,662,369

Realized and Unrealized Gain (Loss)

Net realized gain (loss) on:

Investment securities:

 

 

Unaffiliated issuers

(541,500,445)

Foreign currency transactions

(131,524)

Total net realized gain (loss)

 

(541,631,969)

Change in net unrealized appreciation (depreciation) on:

Investment securities

655,346,652

Assets and liabilities in foreign currencies

2,968

Total change in net unrealized appreciation (depreciation)

 

655,349,620

Net gain (loss)

113,717,651

Net increase (decrease) in net assets resulting from operations

$ 123,380,020

Statement of Changes in Net Assets

 

Six months ended
June 30, 2009
(Unaudited)

Year ended
December 31,
2008

Increase (Decrease) in Net Assets

 

 

Operations

 

 

Net investment income (loss)

$ 9,662,369

$ 39,362,868

Net realized gain (loss)

(541,631,969)

(1,127,004,570)

Change in net unrealized appreciation (depreciation)

655,349,620

(2,110,579,825)

Net increase (decrease) in net assets resulting from operations

123,380,020

(3,198,221,527)

Distributions to shareholders from net investment income

(548,000)

(39,588,806)

Distributions to shareholders from net realized gain

(410,999)

-

Total distributions

(958,999)

(39,588,806)

Share transactions - net increase (decrease)

(210,584,035)

(1,517,000,817)

Redemption fees

593

17,837

Total increase (decrease) in net assets

(88,162,421)

(4,754,793,313)

 

 

 

Net Assets

Beginning of period

3,277,670,617

8,032,463,930

End of period (including undistributed net investment income of $8,979,079 and distributions in excess of net investment income of $135,290, respectively)

$ 3,189,508,196

$ 3,277,670,617

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

Semiannual Report

Financial Highlights - Initial Class

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 23.53

$ 45.12

$ 35.87

$ 33.70

$ 32.01

$ 31.04

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .08

.27

.09

.21

.11

.15 H, K

Net realized and unrealized gain (loss)

  .97

(21.55)

9.53

2.09

1.74

.90

Total from investment operations

  1.05

(21.28)

9.62

2.30

1.85

1.05

Distributions from net investment income

  - J

(.31)

(.33)

(.13)

(.16)

(.08)

Distributions from net realized gain

  - J

-

(.04)

-

-

-

Total distributions

  (.01) L

(.31)

(.37)

(.13)

(.16)

(.08)

Redemption fees added to paid in capital E, J

  -

-

-

-

-

-

Net asset value, end of period

$ 24.57

$ 23.53

$ 45.12

$ 35.87

$ 33.70

$ 32.01

Total Return B, C, D

  4.45%

(47.17)%

26.96%

6.85%

5.80%

3.38%

Ratios to Average Net Assets F,I

 

 

 

 

 

 

Expenses before reductions

  .70% A

.68%

.65%

.68%

.67%

.68%

Expenses net of fee waivers, if any

  .70% A

.68%

.65%

.68%

.67%

.68%

Expenses net of all reductions

  .69% A

.67%

.64%

.67%

.63%

.65%

Net investment income (loss)

  .68% A

.74%

.21%

.61%

.36%

.47% K

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 2,277,499

$ 2,337,892

$ 6,002,656

$ 5,610,629

$ 6,726,655

$ 7,796,888

Portfolio turnover rate G

  172% A

161%

109%

114%

79%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H Investment income per share reflects a special dividend which amounted to $.08 per share. I 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 fee 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. J Amount represents less than $.01 per share. K As a result in the change in the estimate of the return of capital components of dividend 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 class. L Total distributions of $.007 per share is comprised of distributions from net investment income of $.004 and distributions from net realized gain of $.003 per share.

Financial Highlights - Service Class

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 23.47

$ 44.99

$ 35.72

$ 33.56

$ 31.88

$ 30.92

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .07

.23

.04

.18

.08

.11 H, K

Net realized and unrealized gain (loss)

  .97

(21.48)

9.51

2.07

1.72

.90

Total from investment operations

  1.04

(21.25)

9.55

2.25

1.80

1.01

Distributions from net investment income

  - J

(.27)

(.24)

(.09)

(.12)

(.05)

Distributions from net realized gain

  - J

-

(.04)

-

-

-

Total distributions

  (.01) L

(.27)

(.28)

(.09)

(.12)

(.05)

Redemption fees added to paid in capital E, J

  -

-

-

-

-

-

Net asset value, end of period

$ 24.50

$ 23.47

$ 44.99

$ 35.72

$ 33.56

$ 31.88

Total Return B, C, D

  4.42%

(47.23)%

26.87%

6.73%

5.67%

3.26%

Ratios to Average Net Assets F, I

 

 

 

 

 

 

Expenses before reductions

  .80% A

.78%

.75%

.78%

.77%

.78%

Expenses net of fee waivers, if any

  .80% A

.78%

.75%

.78%

.77%

.78%

Expenses net of all reductions

  .79% A

.77%

.74%

.77%

.73%

.75%

Net investment income (loss)

  .58% A

.64%

.11%

.51%

.26%

.37% K

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 376,693

$ 395,759

$ 929,848

$ 877,279

$ 1,086,172

$ 1,326,262

Portfolio turnover rate G

  172% A

161%

109%

114%

79%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H Investment income per share reflects a special dividend which amounted to $.08 per share. I 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 fee 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. J Amount represents less than $.01 per share. K As a result in the change in the estimate of the return of capital components of dividend 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 class. L Total distributions of $.007 per share is comprised of distributions from net investment income of $.004 and distributions from net realized gain of $.003 per share.

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

Semiannual Report

Financial Highlights - Service Class 2

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 23.31

$ 44.65

$ 35.42

$ 33.29

$ 31.64

$ 30.72

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .05

.17

(.02)

.12

.03

.07 H, K

Net realized and unrealized gain (loss)

  .96

(21.29)

9.43

2.07

1.71

.89

Total from investment operations

  1.01

(21.12)

9.41

2.19

1.74

.96

Distributions from net investment income

  - J

(.22)

(.15)

(.06)

(.09)

(.04)

Distributions from net realized gain

  - J

-

(.03)

-

-

-

Total distributions

  (.01) L

(.22)

(.18)

(.06)

(.09)

(.04)

Redemption fees added to paid in capital E, J

  -

-

-

-

-

-

Net asset value, end of period

$ 24.31

$ 23.31

$ 44.65

$ 35.42

$ 33.29

$ 31.64

Total Return B, C, D

  4.32%

(47.31)%

26.66%

6.57%

5.50%

3.12%

Ratios to Average Net Assets F, I

 

 

 

 

 

 

Expenses before reductions

  .95% A

.93%

.90%

.94%

.92%

.93%

Expenses net of fee waivers, if any

  .95% A

.93%

.90%

.94%

.92%

.93%

Expenses net of all reductions

  .95% A

.92%

.89%

.92%

.88%

.90%

Net investment income (loss)

  .43% A

.49%

(.04)%

.36%

.11%

.22% K

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 449,994

$ 447,530

$ 898,204

$ 627,754

$ 858,587

$ 811,126

Portfolio turnover rate G

  172% A

161%

109%

114%

79%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H Investment income per share reflects a special dividend which amounted to $.08 per share. I 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 fee 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. J Amount represents less than $.01 per share. K As a result in the change in the estimate of the return of capital components of dividend 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 class. L Total distributions of $.007 per share is comprised of distributions from net investment income of $.004 and distributions from net realized gain of $.003 per share.

Financial Highlights - Service Class 2R

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 23.26

$ 44.42

$ 35.28

$ 33.18

$ 31.54

$ 30.65

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .05

.18

(.01)

.12

.04

.07 H, K

Net realized and unrealized gain (loss)

  .96

(21.20)

9.38

2.06

1.70

.88

Total from investment operations

  1.01

(21.02)

9.37

2.18

1.74

.95

Distributions from net investment income

  - J

(.14)

(.19)

(.08)

(.10)

(.06)

Distributions from net realized gain

  - J

-

(.04)

-

-

-

Total distributions

  (.01) L

(.14)

(.23)

(.08)

(.10)

(.06)

Redemption fees added to paid in capital E, J

  -

-

-

-

-

-

Net asset value, end of period

$ 24.26

$ 23.26

$ 44.42

$ 35.28

$ 33.18

$ 31.54

Total Return B, C, D

  4.33%

(47.31)%

26.66%

6.58%

5.52%

3.10%

Ratios to Average Net Assets F, I

 

 

 

 

 

 

Expenses before reductions

  .94% A

.93%

.89%

.93%

.92%

.93%

Expenses net of fee waivers, if any

  .94% A

.93%

.89%

.93%

.92%

.93%

Expenses net of all reductions

  .94% A

.92%

.89%

.92%

.88%

.90%

Net investment income (loss)

  .43% A

.49%

(.04)%

.36%

.12%

.22% K

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 4,064

$ 3,061

$ 20,051

$ 5,063

$ 5,409

$ 2,667

Portfolio turnover rate G

  172% A

161%

109%

114%

79%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H Investment income per share reflects a special dividend which amounted to $.08 per share. I 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 fee 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. J Amount represents less than $.01 per share. K As a result in the change in the estimate of the return of capital components of dividend 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 class. L Total distributions of $.007 per share is comprised of distributions from net investment income of $.004 and distributions from net realized gain of $.003 per share.

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

Semiannual Report

Financial Highlights - Investor Class

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005 H

Selected Per-Share Data

 

 

 

 

 

Net asset value, beginning of period

$ 23.48

$ 45.00

$ 35.78

$ 33.67

$ 32.60

Income from Investment Operations

 

 

 

 

 

Net investment income (loss) E

  .06

.24

.04

.17

.03

Net realized and unrealized gain (loss)

  .97

(21.49)

9.50

2.08

1.04

Total from investment operations

  1.03

(21.25)

9.54

2.25

1.07

Distributions from net investment income

  - J

(.27)

(.28)

(.14)

-

Distributions from net realized gain

  - J

-

(.04)

-

-

Total distributions

  (.01) K

(.27)

(.32)

(.14)

-

Redemption fees added to paid in capital E, J

  -

-

-

-

-

Net asset value, end of period

$ 24.50

$ 23.48

$ 45.00

$ 35.78

$ 33.67

Total Return B, C, D

  4.38%

(47.22)%

26.81%

6.72%

3.28%

Ratios to Average Net Assets F, I

 

 

 

 

 

Expenses before reductions

  .81% A

.77%

.76%

.81%

.83% A

Expenses net of fee waivers, if any

  .81% A

.77%

.76%

.81%

.83% A

Expenses net of all reductions

  .81% A

.76%

.76%

.80%

.79% A

Net investment income (loss)

  .57% A

.65%

.09%

.49%

.23% A

Supplemental Data

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 81,258

$ 93,428

$ 181,705

$ 76,965

$ 24,166

Portfolio turnover rate G

  172% A

161%

109%

114%

79%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H For the period July 21, 2005 (commencement of sale of shares) to December 31, 2005. I 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 fee 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. J Amount represents less than $.01 per share. K Total distributions of $.007 per share is comprised of distributions from net investment income of $.004 and distributions from net realized gain of $.003 per share.

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

Semiannual Report

Notes to Financial Statements

For the period ended June 30, 2009 (Unaudited)

1. Organization.

VIP Growth Portfolio (the Fund) is a fund of Variable Insurance Products Fund (the trust) and is authorized to issue an unlimited number of shares. The trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. Shares of the Fund may only be purchased by insurance companies for the purpose of funding variable annuity or variable life insurance contracts. The Fund offers the following classes of shares: Initial Class shares, Service Class shares, Service Class 2 shares, Service Class 2R shares and Investor Class 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 transfer agent and distribution and service plan fees incurred. Certain expense reductions also differ by class.

2. Investments in Fidelity Central Funds.

The Fund may invest in Fidelity Central Funds, which are open-end investment companies available only to other investment companies and accounts managed by Fidelity Management & Research Company (FMR) and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.

The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of FMR.

A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the SEC's web site at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC's web site or upon request.

3. Significant Accounting Policies.

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. Actual results could differ from those estimates. Events or transactions occurring after period end through the date that the financial statements were issued, August 10, 2009, have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:

Security Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Fund uses independent pricing services approved by the Board of Trustees to value its investments. Generally Accepted Accounting Principles (GAAP) establishes a disclosure hierarchy that categorizes the inputs to valuation techniques used to value assets and liabilities at measurement date. These inputs are classified into three levels. Level 1 includes readily available unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 includes observable inputs other than quoted prices included in Level 1 that are observable either directly or indirectly. Level 3 includes unobservable inputs when market prices are not readily available or reliable. Changes in valuation techniques may result in transfers in or out of an investment's assigned level within the hierarchy. The aggregate value by input level, as of June 30, 2009, for the Fund's investments is included at the end of the Fund's Schedule of Investments. Valuation techniques of the Fund's major categories of assets and liabilities as presented in the Schedule of Investments are as follows.

Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by an independent pricing service on the primary market or exchange on which they are traded. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price. Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value each business day. Short-term securities with remaining maturities of sixty days or less for which quotations are not readily available are valued at amortized cost, which approximates value.

When current market prices or quotations are not readily available or reliable, valuations may be determined in good faith in accordance with procedures adopted by the Board of Trustees. Factors used in determining value may include significant market or security specific events, changes in interest rates and credit quality, and developments in foreign markets which are monitored by evaluating the performance of ADRs, futures contracts and exchange-traded funds. The frequency with which these procedures are used cannot be predicted and may be utilized to a significant extent. The value of securities used for net asset value (NAV) calculation under these procedures may differ from published prices for the same securities.

Foreign Currency. The Fund uses 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.

Semiannual Report

Notes to Financial Statements (Unaudited) - continued

3. Significant Accounting Policies - continued

Investment Transactions and Income. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. 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 Fund is 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 Fund estimates the components of distributions received that may be considered return of capital distributions or capital gain distributions. Interest income and distributions from the Fidelity Central Funds are accrued as earned. Interest income includes coupon interest and amortization of premium and accretion of discount on debt securities. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.

Expenses. Most expenses of the trust can be directly attributed to a fund. Expenses which cannot be directly attributed are apportioned among each Fund in the trust. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.

Deferred Trustee Compensation. Under a Deferred Compensation Plan (the Plan), independent 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 invested in a cross-section of Fidelity funds, are marked-to-market and remain in the Fund until distributed in accordance with the Plan. The investment of deferred amounts and the offsetting payable to the Trustees are included in the accompanying Statement of Assets and Liabilities.

Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company by distributing substantially all of its taxable income and realized gains under Subchapter M of the Internal Revenue Code and filing its U.S. federal tax return. As a result, no provision for income taxes is required. The Fund is subject to the provisions of FASB Interpretation No. 48, Accounting for Uncertainties in Income Taxes (FIN 48). FIN 48 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. There are no unrecognized tax benefits in the accompanying financial statements. A Fund's federal tax return is subject to examination by the Internal Revenue Service (IRS) for a period of three years. Foreign taxes are provided for based on the 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 short-term gain distributions from the underlying funds, futures transactions, foreign currency transactions, partnerships (including allocations from Fidelity Central Funds), deferred trustees compensation, capital loss carryforwards and losses deferred due to wash sales.

The federal tax cost of investments and unrealized appreciation (depreciation) as of period end were as follows:

Unrealized appreciation

$ 198,400,031

Unrealized depreciation

(382,293,768)

Net unrealized appreciation (depreciation)

$ (183,893,737)

Cost for federal income tax purposes

$ 3,398,382,120

Trading (Redemption) Fees. 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 Fund and accounted for as an addition to paid in capital.

4. Purchases and Sales of Investments.

Purchases and sales of securities, other than short-term securities, aggregated $2,607,977,191 and $2,564,665,640, respectively.

5. Fees and Other Transactions with Affiliates.

Management Fee. FMR and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .30% of the Fund's average net assets and a group fee rate that averaged .27% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by FMR.

Semiannual Report

5. Fees and Other Transactions with Affiliates - continued

Management Fee - continued

The group fee rate decreases as assets under management increase and increases as assets under management decrease. For the period, the total annualized management fee rate was .57% of the Fund's average net assets.

Distribution and Service Plan. In accordance with Rule 12b-1 of the 1940 Act, the Fund has 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 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

$ 182,677

Service Class 2

540,058

Service Class 2 R

4,868

 

$ 727,603

Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc. (FIIOC), an affiliate of FMR, is the Fund's transfer, dividend disbursing, and shareholder servicing agent. FIIOC receives an asset-based fee with respect to each class. Each class (with the exception of Investor Class) pays a transfer agent fee, excluding out of pocket expenses, equal to an annual rate of .07% of average net assets. Investor Class pays a monthly asset-based transfer agent fee of .15% of average net assets. The total transfer agent fees paid by each class to FIIOC, including out of pocket expenses, were as follows:

Initial Class

$ 940,726

Service Class

158,564

Service Class 2

189,780

Service Class 2R

1,625

Investor Class

82,290

 

$ 1,372,985

Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of FMR, maintains the 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.

Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. The commissions paid to these affiliated firms were $66,044 for the period.

6. Committed Line of Credit.

The Fund participates with other funds managed by FMR in a $3.5 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 Fund has agreed to pay commitment fees on its pro-rata portion of the line of credit, which amounted to $9,947 and is reflected in Miscellaneous Expense on the Statement of Operations. During the period, there were no borrowings on this line of credit.

7. Security Lending.

The Fund lends portfolio securities from time to time in order to earn additional income. On the settlement date of the loan, the 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 Fund and any additional required collateral is delivered to the Fund 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. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. Security lending income represents the income earned on investing cash collateral, less fees and expenses associated with the loan, plus any premium payments that may be received on the loan of certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds. Net income from lending portfolio securities during the period amounted to $409,143.

Semiannual Report

Notes to Financial Statements (Unaudited) - continued

8. Expense Reductions.

Many of the brokers with whom FMR places trades on behalf of the Fund provided services to the Fund in addition to trade execution. These services included payments of certain expenses on behalf of the Fund totaling $36,840 for the period. In addition, through arrangements with the Fund's custodian, credits realized as a result of uninvested cash balances were used to reduce the Fund's expenses. During the period, these credits reduced the Fund's custody expenses by $643.

9. Distributions to Shareholders.

Distributions to shareholders of each class were as follows:

 

Six months ended
June 30, 2009

Year ended
December 31, 2008

From net investment income

 

 

Initial Class

$ 389,093

$ 29,994,939

Service Class

65,926

4,447,535

Service Class 2

76,993

4,070,779

Service Class 2R

707

18,979

Investor Class

15,281

1,056,574

Total

$ 548,000

$ 39,588,806

From net realized gain

 

 

Initial Class

$ 291,821

$ -

Service Class

49,445

-

Service Class 2

57,745

-

Service Class 2R

531

-

Investor Class

11,457

-

Total

$ 410,999

$ -

10. Share Transactions.

Transactions for each class of shares were as follows:

 

Shares

Dollars

Six months ended
June 30, 2009

Year ended
December 31, 2008

Six months ended
June 30, 2009

Year ended
December 31, 2008

Initial Class

 

 

 

 

Shares sold

1,726,400

3,905,978

$ 39,797,260

$ 138,026,441

Reinvestment of distributions

30,480

1,288,996

680,914

29,994,938

Shares redeemed

(8,413,248)

(38,869,099)

(188,311,875)

(1,490,052,456)

Net increase (decrease)

(6,656,368)

(33,674,125)

$ (147,833,701)

$ (1,322,031,077)

Service Class

 

 

 

 

Shares sold

330,392

1,299,183

$ 7,500,653

$ 44,341,627

Reinvestment of distributions

5,178

191,539

115,371

4,447,535

Shares redeemed

(1,818,080)

(5,299,957)

(40,610,682)

(193,461,539)

Net increase (decrease)

(1,482,510)

(3,809,235)

$ (32,994,658)

$ (144,672,377)

Service Class 2

 

 

 

 

Shares sold

1,804,846

4,426,611

$ 39,916,662

$ 159,010,524

Reinvestment of distributions

6,091

176,530

134,738

4,070,779

Shares redeemed

(2,497,375)

(5,522,476)

(55,816,320)

(198,453,754)

Net increase (decrease)

(686,438)

(919,335)

$ (15,764,920)

$ (35,372,451)

Service Class 2R

 

 

 

 

Shares sold

54,755

101,959

$ 1,295,791

$ 4,039,975

Reinvestment of distributions

56

825

1,238

18,979

Shares redeemed

(18,875)

(422,581)

(414,695)

(16,348,368)

Net increase (decrease)

35,936

(319,797)

$ 882,334

$ (12,289,414)

Investor Class

 

 

 

 

Shares sold

128,074

2,298,287

$ 2,942,543

$ 86,244,669

Reinvestment of distributions

1,200

45,483

26,738

1,056,574

Shares redeemed

(791,930)

(2,402,506)

(17,842,371)

(89,936,741)

Net increase (decrease)

(662,656)

(58,736)

$ (14,873,090)

$ (2,635,498)

Semiannual Report

11. Other.

The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund's maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

At the end of the period, FMR or its affiliates were the owners of record of 15% of the total outstanding shares of the Fund and two otherwise unaffiliated shareholders were the owners of record of 36% of the total outstanding shares of the Fund.

Semiannual Report

Investment Adviser

Fidelity Management & Research Company
Boston, MA

Investment Sub-Adviser

FMR Co., Inc.

Fidelity Management & Research (U.K.) Inc.

Fidelity Management & Research (Hong Kong) Limited

Fidelity Management & Research (Japan) Inc.

Fidelity Research & Analysis Company

FIL Investment Advisors

FIL Investment Advisors (U.K.) Ltd.

Fidelity Investments Japan Limited

General Distributor

Fidelity Distributors Corporation
Boston, MA

Transfer and Service Agents

Fidelity Investments Institutional Operations Company, Inc.
Boston, MA 

Fidelity Service Company, Inc.
Boston, MA 

Custodian

The Bank of New York Mellon
New York, NY 

VIPGRWTR-SANN-0809
1.833448.103

Fidelity® Variable Insurance Products:
Overseas Portfolio

Semiannual Report

June 30, 2009

(2_fidelity_logos) (Registered_Trademark)

Contents

Shareholder Expense Example

<Click Here>

An example of shareholder expenses.

Investment Changes

<Click Here>

A summary of major shifts in the fund's investments over the past six months.

Investments

<Click Here>

A complete list of the fund's investments with their market values.

Financial Statements

<Click Here>

Statements of assets and liabilities, operations, and changes in net assets, as well as financial highlights.

Notes

<Click Here>

Notes to the financial statements.

To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov. You may also call 1-877-208-0098 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 LLC or an affiliated company.

This report and the financial statements contained herein are submitted for the general information of the shareholders of the fund. This report is not authorized for distribution to prospective investors in the fund 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 holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com or http://www.advisor.fidelity.com, as applicable.

NOT FDIC INSURED · MAY LOSE VALUE · NO BANK GUARANTEE

Neither the fund nor Fidelity Distributors Corporation is a bank.

Semiannual Report

Shareholder Expense Example

As a shareholder of the 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 Fund 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 (January 1, 2009 to June 30, 2009).

Actual Expenses

The first line of the accompanying table for each class of the 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. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.

Hypothetical Example for Comparison Purposes

The second line of the accompanying table for each class of the 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. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.

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.

 



Annualized
Expense Ratio


Beginning
Account Value
January 1, 2009


Ending
Account Value
June 30, 2009

Expenses Paid
During Period*
January 1, 2009 to
June 30, 2009

Initial Class

.89%

 

 

 

Actual

 

$ 1,000.00

$ 1,031.20

$ 4.48

Hypothetical A

 

$ 1,000.00

$ 1,020.38

$ 4.46

Service Class

.99%

 

 

 

Actual

 

$ 1,000.00

$ 1,031.40

$ 4.99

Hypothetical A

 

$ 1,000.00

$ 1,019.89

$ 4.96

Service Class 2

1.13%

 

 

 

Actual

 

$ 1,000.00

$ 1,030.70

$ 5.69

Hypothetical A

 

$ 1,000.00

$ 1,019.19

$ 5.66

Initial Class R

.89%

 

 

 

Actual

 

$ 1,000.00

$ 1,032.10

$ 4.48

Hypothetical A

 

$ 1,000.00

$ 1,020.38

$ 4.46

Service Class R

.98%

 

 

 

Actual

 

$ 1,000.00

$ 1,031.40

$ 4.94

Hypothetical A

 

$ 1,000.00

$ 1,019.93

$ 4.91

Service Class 2R

1.13%

 

 

 

Actual

 

$ 1,000.00

$ 1,030.00

$ 5.69

Hypothetical A

 

$ 1,000.00

$ 1,019.19

$ 5.66

Investor Class R

.99%

 

 

 

Actual

 

$ 1,000.00

$ 1,031.30

$ 4.99

Hypothetical A

 

$ 1,000.00

$ 1,019.89

$ 4.96

A 5% return per year before expenses

* Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).

Semiannual Report

Investment Changes (Unaudited)

Geographic Diversification (% of fund's net assets)

As of June 30, 2009

fid4756

United Kingdom

23.0%

 

fid4758

Japan

17.5%

 

fid4760

France

11.3%

 

fid4762

Germany

10.0%

 

fid4764

Switzerland

7.1%

 

fid4766

Hong Kong

3.4%

 

fid4768

Australia

3.3%

 

fid4770

Spain

3.2%

 

fid4772

United States of America

3.1%

 

fid4774

Other

18.1%

 

fid4776

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

As of December 31, 2008

fid4756

United Kingdom

25.1%

 

fid4758

Japan

19.0%

 

fid4760

France

12.3%

 

fid4762

Switzerland

9.6%

 

fid4764

Germany

8.3%

 

fid4766

United States of America

5.7%

 

fid4768

Australia

3.6%

 

fid4770

Italy

3.3%

 

fid4772

Netherlands

2.7%

 

fid4774

Other

10.4%

 

fid4788

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

Asset Allocation

 

% of fund's
net assets

% of fund's net assets
6 months ago

Stocks

99.9

98.0

Short-Term Investments and Net Other Assets

0.1

2.0

Top Ten Stocks as of June 30, 2009

 

% of fund's
net assets

% of fund's net assets
6 months ago

Nestle SA (Reg.)
(Switzerland, Food Products)

2.5

2.9

HSBC Holdings PLC (United Kingdom, Commercial Banks)

2.1

1.2

Vodafone Group PLC (United Kingdom, Wireless Telecommunication Services)

2.0

2.0

Toyota Motor Corp. (Japan, Automobiles)

1.9

1.3

Total SA (France, Oil, Gas & Consumable Fuels)

1.9

1.8

Roche Holding AG (participation certificate) (Switzerland, Pharmaceuticals)

1.7

1.9

Novo Nordisk AS (Denmark, Pharmaceuticals)

1.4

1.1

Mitsubishi UFJ Financial Group, Inc. (Japan, Commercial Banks)

1.4

1.6

Anheuser-Busch InBev NV (Belgium, Beverages)

1.4

0.5

BP PLC (United Kingdom, Oil, Gas & Consumable Fuels)

1.3

1.8

 

17.6

Market Sectors as of June 30, 2009

 

% of fund's
net assets

% of fund's net assets
6 months ago

Financials

28.0

23.3

Consumer Staples

11.6

14.5

Consumer Discretionary

11.0

9.8

Energy

8.7

8.5

Materials

8.7

4.8

Information Technology

7.4

5.0

Industrials

7.4

5.2

Health Care

6.9

11.9

Telecommunication Services

6.7

8.5

Utilities

3.5

6.5

Semiannual Report

Investments June 30, 2009 (Unaudited)

Showing Percentage of Net Assets

Common Stocks - 99.9%

Shares

Value

Australia - 3.3%

AMP Ltd.

1,043,407

$ 4,102,484

ASX Ltd.

96,059

2,862,831

Australia & New Zealand Banking Group Ltd.

234,901

3,120,893

BHP Billiton Ltd.

367,953

10,079,130

Commonwealth Bank of Australia

227,607

7,151,935

National Australia Bank Ltd.

266,905

4,825,618

Newcrest Mining Ltd.

120,084

2,951,894

Rio Tinto Ltd.

79,200

3,330,957

Rio Tinto Ltd. rights 7/1/09 (a)(d)

41,580

801,009

Seek Ltd.

593,800

1,995,031

Wesfarmers Ltd.

93,194

1,700,707

Westfield Group unit

910,199

8,345,493

TOTAL AUSTRALIA

51,267,982

Belgium - 1.6%

Anheuser-Busch InBev NV

589,100

21,269,749

Fortis (a)

370,100

1,261,508

Hamon & Compagnie International SA

73,974

2,402,121

TOTAL BELGIUM

24,933,378

Bermuda - 0.5%

Clear Media Ltd. (a)

249,000

100,886

Lancashire Holdings Ltd. (a)

387,200

2,971,615

Signet Jewelers Ltd. (United Kingdom)

197,365

3,984,008

TOTAL BERMUDA

7,056,509

Brazil - 0.7%

TIM Participacoes SA sponsored ADR (non-vtg.) (d)

303,600

5,291,748

Vivo Participacoes SA sponsored ADR

294,700

5,581,618

TOTAL BRAZIL

10,873,366

Canada - 0.7%

Canadian Natural Resources Ltd.

85,600

4,503,365

Open Text Corp. (a)

59,700

2,181,455

Suncor Energy, Inc.

142,400

4,330,400

TOTAL CANADA

11,015,220

Cayman Islands - 0.1%

Himax Technologies, Inc. sponsored ADR

503,300

1,887,375

China - 0.7%

Baidu.com, Inc. sponsored ADR (a)

16,400

4,937,876

China Merchants Bank Co. Ltd. (H Shares)

650

1,488

China Telecom Corp. Ltd. (H Shares)

6,870,000

3,409,951

Parkson Retail Group Ltd.

1,296,500

1,853,601

TOTAL CHINA

10,202,916

Denmark - 1.8%

Danske Bank AS (a)

96,100

1,656,444

Novo Nordisk AS:

Series B

224,400

12,132,129

 

Shares

Value

Series B sponsored ADR

179,400

$ 9,770,124

Vestas Wind Systems AS (a)

52,200

3,741,601

TOTAL DENMARK

27,300,298

Finland - 0.5%

Nokia Corp. sponsored ADR

529,200

7,715,736

France - 11.3%

Accor SA (d)

145,877

5,781,585

Alstom SA (d)

132,400

7,810,349

AXA SA

179,815

3,402,971

AXA SA sponsored ADR

158,600

3,007,056

BNP Paribas SA

253,653

16,455,707

Carrefour SA

88,000

3,754,972

CNP Assurances

44,000

4,200,273

Credit Agricole SA

159,900

1,990,813

Danone

281,216

13,877,176

Electricite de France

58,800

2,859,951

Essilor International SA

70,800

3,374,593

Iliad Group SA

28,200

2,734,912

Ingenico SA

246,990

4,711,778

Ipsos SA (d)

113,100

2,839,752

L'Air Liquide SA

34,178

3,121,470

Lafarge SA (Bearer)

72,300

4,893,284

Laurent-Perrier Group

21,000

1,443,378

Michelin SA (Compagnie Generale des Etablissements) Series B

53,000

3,018,702

Nexity

61,400

1,831,034

Pernod Ricard SA (d)

125,510

7,899,493

Remy Cointreau SA

54,000

1,954,242

Sanofi-Aventis sponsored ADR

306,800

9,047,532

Societe Generale Series A

217,741

11,876,463

Total SA:

Series B

286,700

15,537,592

sponsored ADR

249,200

13,514,116

Unibail-Rodamco

102,400

15,248,449

Vallourec SA

33,700

4,090,359

Veolia Environnement

162,797

4,793,179

TOTAL FRANCE

175,071,181

Germany - 10.0%

Allianz AG (Reg.)

77,600

7,146,652

BASF AG

117,800

4,681,194

Bayer AG

157,900

8,465,208

Bayerische Motoren Werke AG (BMW)

221,800

8,350,430

Commerzbank AG (a)(d)

135,300

840,749

Daimler AG

144,800

5,251,896

Daimler AG (Reg.)

130,200

4,722,366

Deutsche Bank AG

122,400

7,466,600

Deutsche Bank AG (NY Shares)

62,000

3,782,000

Deutsche Boerse AG

207,400

16,082,057

Deutsche Post AG

176,800

2,302,656

Deutsche Telekom AG (Reg.)

207,500

2,448,573

E.ON AG

579,032

20,483,891

Common Stocks - continued

Shares

Value

Germany - continued

Fresenius SE

113,800

$ 5,326,762

Metro AG

310,800

14,831,331

Munich Re Group (Reg.)

83,000

11,198,834

Q-Cells SE (a)

81,400

1,655,607

SAP AG

173,200

6,961,130

SAP AG sponsored ADR (d)

154,600

6,213,374

Siemens AG (Reg.)

105,300

7,285,832

Vossloh AG

73,300

8,796,072

TOTAL GERMANY

154,293,214

Hong Kong - 3.4%

China Unicom (Hong Kong) Ltd. sponsored ADR

458,800

6,120,392

Hang Lung Properties Ltd.

2,089,000

6,914,005

Hang Seng Bank Ltd.

131,600

1,850,914

Hong Kong Exchange & Clearing Ltd.

1,182,100

18,410,492

Hutchison Whampoa Ltd.

1,518,000

9,920,993

Swire Pacific Ltd. (A Shares)

911,500

9,197,448

TOTAL HONG KONG

52,414,244

Indonesia - 0.0%

PT Indosat Tbk sponsored ADR

17,618

429,703

Ireland - 1.1%

CRH PLC

505,578

11,559,541

Paddy Power PLC (Ireland)

229,500

5,343,866

TOTAL IRELAND

16,903,407

Israel - 0.3%

Teva Pharmaceutical Industries Ltd. sponsored ADR

84,800

4,184,032

Italy - 2.3%

Bulgari SpA

452,000

2,415,618

ENI SpA

405,486

9,615,881

ENI SpA sponsored ADR

134,300

6,367,163

Intesa Sanpaolo SpA (a)

3,187,500

10,261,189

Tod's SpA

43,100

2,454,529

UniCredit SpA (a)

1,885,438

4,747,244

TOTAL ITALY

35,861,624

Japan - 17.5%

Asahi Glass Co. Ltd.

234,000

1,882,493

Canon, Inc.

218,000

7,120,753

Canon, Inc. sponsored ADR

188,900

6,144,917

Denso Corp.

334,800

8,618,923

East Japan Railway Co.

65,900

3,974,454

Eisai Co. Ltd.

136,500

4,874,241

Fanuc Ltd.

60,300

4,857,300

Fast Retailing Co. Ltd.

12,400

1,621,840

Hitachi Ltd.

365,000

1,135,886

Honda Motor Co. Ltd.

405,400

11,152,898

Hoya Corp.

95,000

1,909,171

Japan Retail Fund Investment Corp.

568

2,629,657

Japan Tobacco, Inc.

474

1,485,940

 

Shares

Value

JFE Holdings, Inc.

123,900

$ 4,179,945

JTEKT Corp.

363,100

3,697,525

Jupiter Telecommunications Co.

3,815

2,898,822

Kao Corp.

187,000

4,086,106

Konica Minolta Holdings, Inc.

346,000

3,620,366

Mitsubishi Corp.

150,800

2,798,883

Mitsubishi Electric Corp.

765,000

4,851,975

Mitsubishi Estate Co. Ltd.

486,000

8,127,326

Mitsubishi UFJ Financial Group, Inc.

3,523,200

21,755,042

Mitsui & Co. Ltd.

393,600

4,682,261

Mitsui Sumitomo Insurance Group Holdings, Inc.

85,100

2,239,357

Murata Manufacturing Co. Ltd.

116,000

4,936,939

Nippon Telegraph & Telephone Corp.

109,700

4,467,578

Nomura Holdings, Inc.

1,216,800

10,270,821

NTT DoCoMo, Inc.

2,139

3,128,582

Omron Corp.

323,200

4,680,168

ORIX Corp.

25,240

1,522,234

Osaka Gas Co. Ltd.

480,000

1,534,645

Point, Inc.

31,970

1,719,049

Promise Co. Ltd. (d)

398,900

5,105,556

Rakuten, Inc.

11,228

6,771,649

Ricoh Co. Ltd.

789,000

10,196,761

Seven & i Holdings Co., Ltd.

170,500

4,017,595

Sharp Corp.

473,000

4,924,679

Shin-Etsu Chemical Co., Ltd.

76,300

3,548,285

Shiseido Co. Ltd.

85,000

1,395,858

Shizuoka Bank Ltd.

233,000

2,314,642

SMC Corp.

44,500

4,799,450

Softbank Corp.

85,600

1,672,281

Sony Corp.

98,600

2,572,377

Sony Corp. sponsored ADR

34,500

892,170

Sugi Holdings Co. Ltd.

130,700

2,693,097

Sumitomo Corp.

457,900

4,667,647

Sumitomo Metal Industries Ltd.

1,545,000

4,121,711

Sumitomo Mitsui Financial Group, Inc.

342,700

13,980,495

T&D Holdings, Inc.

186,650

5,366,902

Tokio Marine Holdings, Inc.

128,400

3,511,740

Tokyo Electron Ltd.

68,900

3,340,042

Toyota Motor Corp.

541,100

20,462,978

Toyota Motor Corp. sponsored ADR

120,500

9,101,365

Yahoo! Japan Corp. (d)

12,647

4,036,905

TOTAL JAPAN

272,100,282

Luxembourg - 1.1%

ArcelorMittal SA (NY Shares) Class A

266,600

8,819,128

SES SA (A Shares) FDR unit

451,647

8,552,591

TOTAL LUXEMBOURG

17,371,719

Netherlands - 2.1%

Aegon NV

266,600

1,639,066

ASML Holding NV (NY Shares)

146,200

3,165,230

Gemalto NV (a)

88,800

3,071,644

Common Stocks - continued

Shares

Value

Netherlands - continued

ING Groep NV (Certificaten Van Aandelen)

211,700

$ 2,144,505

Koninklijke Ahold NV

449,100

5,155,532

Koninklijke KPN NV

519,200

7,136,434

Koninklijke Philips Electronics NV

203,200

3,751,274

Randstad Holdings NV (a)

116,500

3,221,718

Royal DSM NV

57,600

1,804,164

STMicroelectronics NV

234,200

1,765,309

TOTAL NETHERLANDS

32,854,876

Netherlands Antilles - 0.2%

Schlumberger Ltd. (NY Shares)

44,800

2,424,128

Norway - 1.1%

DnB Nor ASA (a)

324,400

2,471,254

Norsk Hydro ASA (a)

310,000

1,590,436

Pronova BioPharma ASA (a)

721,300

1,917,576

StatoilHydro ASA

320,900

6,316,026

StatoilHydro ASA sponsored ADR

242,400

4,792,248

TOTAL NORWAY

17,087,540

Papua New Guinea - 0.6%

Lihir Gold Ltd. (a)

2,218,776

5,273,620

Oil Search Ltd.

837,360

3,683,649

TOTAL PAPUA NEW GUINEA

8,957,269

Singapore - 0.8%

Singapore Exchange Ltd.

1,842,000

9,029,412

United Overseas Bank Ltd.

390,000

3,952,775

TOTAL SINGAPORE

12,982,187

South Africa - 1.1%

Aspen Pharmacare Holdings Ltd.

565,600

4,015,639

Impala Platinum Holdings Ltd.

201,200

4,447,194

MTN Group Ltd.

563,100

8,639,092

TOTAL SOUTH AFRICA

17,101,925

Spain - 3.2%

Banco Bilbao Vizcaya Argentaria SA

135,700

1,708,479

Banco Santander SA

1,066,600

12,891,811

EDP Renovaveis SA

492,400

5,042,033

Iberdrola SA

465,000

3,770,037

Iberdrola SA

304,100

2,388,742

Inditex SA

81,000

3,882,351

Telefonica SA

814,580

18,496,750

Telefonica SA sponsored ADR

25,900

1,758,351

TOTAL SPAIN

49,938,554

Sweden - 0.4%

Nordea Bank AB

188,800

1,495,140

Skandinaviska Enskilda Banken AB (A Shares) (a)

327,600

1,439,403

 

Shares

Value

Svenska Handelsbanken AB (A Shares)

98,900

$ 1,868,287

Telefonaktiebolaget LM Ericsson (B Shares) sponsored ADR

203,100

1,986,318

TOTAL SWEDEN

6,789,148

Switzerland - 7.1%

ABB Ltd. sponsored ADR

374,900

5,915,922

Adecco SA (Reg.)

115,101

4,795,169

Compagnie Financiere Richemont Series A

281,660

5,854,089

Credit Suisse Group sponsored ADR

117,600

5,377,848

Credit Suisse Group (Reg.)

165,985

7,605,818

Nestle SA (Reg.)

1,025,750

38,635,568

Roche Holding AG (participation certificate)

188,245

25,592,587

Swiss Reinsurance Co. (Reg.)

65,532

2,167,912

UBS AG:

(For. Reg.) (a)

447,317

5,493,102

(NY Shares) (a)

191,543

2,338,740

Zurich Financial Services AG (Reg.)

39,551

6,968,024

TOTAL SWITZERLAND

110,744,779

Taiwan - 0.4%

Hon Hai Precision Industry Co. Ltd. (Foxconn)

874,000

2,699,665

Taiwan Semiconductor Manufacturing Co. Ltd. sponsored ADR

414,100

3,896,681

TOTAL TAIWAN

6,596,346

United Kingdom - 23.0%

Aegis Group PLC

2,629,334

3,979,597

Anglo American PLC:

ADR

404,400

5,920,416

(United Kingdom)

315,908

9,165,192

AstraZeneca PLC:

(United Kingdom)

90,500

3,990,252

sponsored ADR

189,400

8,360,116

Aviva PLC

519,200

2,916,963

BAE Systems PLC

450,800

2,510,430

Barclays PLC

1,612,200

7,491,752

Barclays PLC Sponsored ADR (d)

214,200

3,949,848

BG Group PLC

596,700

9,993,309

BHP Billiton PLC

795,495

17,850,785

BP PLC

2,628,406

20,768,562

British Land Co. PLC

1,032,100

6,486,205

Cairn Energy PLC (a)

126,300

4,866,265

Centrica PLC

2,184,600

8,014,608

Diageo PLC

1,175,300

16,880,480

GlaxoSmithKline PLC

295,600

5,221,122

Hammerson PLC (d)

684,500

3,457,143

Hays PLC

1,754,300

2,474,819

Hikma Pharmaceuticals PLC

223,300

1,724,765

HSBC Holdings PLC:

(United Kingdom) (Reg.)

915,380

7,625,966

sponsored ADR (d)

584,932

24,432,610

Common Stocks - continued

Shares

Value

United Kingdom - continued

Imperial Tobacco Group PLC

276,700

$ 7,183,261

Informa PLC

1,875,580

6,757,487

InterContinental Hotel Group PLC

303,900

3,114,758

Intertek Group PLC

146,000

2,505,202

Jardine Lloyd Thompson Group PLC

1,201,473

7,970,653

Johnson Matthey PLC

229,700

4,349,525

Land Securities Group PLC

373,700

2,897,210

Lloyds TSB Group PLC

1,863,744

2,144,151

Man Group PLC

1,312,125

5,990,233

Marks & Spencer Group PLC

1,273,000

6,408,484

Prudential PLC

709,900

4,829,233

Reed Elsevier PLC

404,214

3,009,092

Rio Tinto PLC:

rights 7/1/09 (a)

20,475

235,118

(Reg.)

39,000

1,350,586

sponsored ADR

60,400

9,897,748

Royal Bank of Scotland Group PLC

3,404,900

2,164,447

Royal Dutch Shell PLC:

Class A (United Kingdom)

547,000

13,660,437

Class A sponsored ADR

189,600

9,516,024

Class B

236,000

5,941,223

Scottish & Southern Energy PLC

327,000

6,127,411

Standard Chartered PLC (United Kingdom)

702,400

13,173,308

Sthree PLC

229,400

683,089

Tesco PLC

935,900

5,444,365

The Restaurant Group PLC

446,300

1,049,950

Vodafone Group PLC

13,676,462

26,599,116

Vodafone Group PLC sponsored ADR

228,800

4,459,312

William Hill PLC

1,869,858

6,044,727

William Morrison Supermarkets PLC

1,372,600

5,340,484

WPP PLC

585,000

3,890,134

Xstrata PLC

497,900

5,384,077

TOTAL UNITED KINGDOM

356,202,050

United States of America - 3.0%

Aon Corp.

168,400

6,377,308

 

Shares

Value

Apple, Inc. (a)

17,100

$ 2,435,553

Calgon Carbon Corp. (a)

249,617

3,467,180

Estee Lauder Companies, Inc. Class A

378,500

12,365,595

Gilead Sciences, Inc. (a)

45,100

2,112,484

Google, Inc. Class A (sub. vtg.) (a)

21,600

9,106,344

Philip Morris International, Inc.

147,200

6,420,864

Sohu.com, Inc. (a)

64,100

4,027,403

TOTAL UNITED STATES OF AMERICA

46,312,731

TOTAL COMMON STOCKS

(Cost $1,633,787,267)

1,548,873,719

Money Market Funds - 3.1%

 

 

 

 

Fidelity Cash Central Fund, 0.40% (b)

4,620,338

4,620,338

Fidelity Securities Lending Cash Central Fund, 0.22% (b)(c)

42,639,986

42,639,986

TOTAL MONEY MARKET FUNDS

(Cost $47,260,324)

47,260,324

TOTAL INVESTMENT PORTFOLIO - 103.0%

(Cost $1,681,047,591)

1,596,134,043

NET OTHER ASSETS - (3.0)%

(45,852,725)

NET ASSETS - 100%

$ 1,550,281,318

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 unaudited listing of the fund's holdings as of its most recent quarter end is available upon request.

(c) Investment made with cash collateral received from securities on loan.

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

Affiliated Central Funds

Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:

Fund

Income earned

Fidelity Cash Central Fund

$ 34,977

Fidelity Securities Lending Cash Central Fund

1,401,687

Total

$ 1,436,664

Other Information

The following is a summary of the inputs used, as of June 30, 2009, involving the Fund's assets and liabilities carried at value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the tables below, please refer to the Security Valuation section in the accompanying Notes to Financial Statements.

Valuation Inputs at Reporting Date:

Description

Total

Level 1

Level 2

Level 3

Investments in Securities:

Equities:

United Kingdom

$ 356,202,050

$ 257,793,443

$ 98,408,607

$ -

Japan

272,100,282

186,521,627

85,578,655

-

France

175,071,181

156,130,618

18,940,563

-

Germany

154,293,214

118,262,061

36,031,153

-

Switzerland

110,744,779

97,645,859

13,098,920

-

Hong Kong

52,414,244

52,414,244

-

-

Australia

51,267,982

40,387,843

10,880,139

-

Spain

49,938,554

16,841,514

33,097,040

-

United States of America

46,312,731

46,312,731

-

-

Other

280,528,702

259,841,782

20,686,920

-

Money Market Funds

47,260,324

47,260,324

-

-

Total Investments in Securities:

$ 1,596,134,043

$ 1,279,412,046

$ 316,722,997

$ -

 

The following is a reconciliation of assets or liabilities for which level 3 inputs were used in determining value:

Investments in Securities:

 

Beginning Balance

$ 37,656,594

Total Realized Gain/Loss

(17,900,926)

Total Unrealized Gain Loss

7,521,996

Cost of purchases

12,372,825

Proceeds of sales

(17,227,962)

Amortization/Accretion

-

Transfers in/out of level 3:

(22,422,527)

Ending Balance

$ -

Net change in unrealized appreciation/depreciation on investments held at June 30, 2009

$ -

The information used in the above reconciliation represents fiscal year to date activity for any Investment Security identified as using Level 3 inputs at either the beginning or the end of the current fiscal period. Transfers in or out of Level 3 represents either the beginning value (for transfer in), or the ending value (for transfer out) of any security or Instrument where a change in the pricing level occurred from the beginning to the end of the period.

Income Tax Information

At December 31, 2008, the fund had a capital loss carryforward of approximately $243,257,460 all of which will expire on December 31, 2016.

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

Semiannual Report

Financial Statements

Statement of Assets and Liabilities

 

June 30, 2009 (Unaudited)

Assets

Investment in securities, at value (including securities loaned of $40,681,797) - See accompanying schedule:

Unaffiliated issuers (cost $1,633,787,267)

$ 1,548,873,719

 

Fidelity Central Funds (cost $47,260,324)

47,260,324

 

Total Investments (cost $1,681,047,591)

 

$ 1,596,134,043

Foreign currency held at value (cost $45)

45

Receivable for investments sold

6,265,505

Receivable for fund shares sold

410,953

Dividends receivable

5,414,678

Distributions receivable from Fidelity Central Funds

119,460

Prepaid expenses

9,906

Other affiliated receivables

708

Other receivables

1,660,190

Total assets

1,610,015,488

 

 

 

Liabilities

Payable to custodian bank

$ 100,318

Payable for investments purchased

9,300,621

Payable for fund shares redeemed

5,691,080

Accrued management fee

948,967

Distribution fees payable

113,885

Other affiliated payables

156,171

Other payables and accrued expenses

783,142

Collateral on securities loaned, at value

42,639,986

Total liabilities

59,734,170

 

 

 

Net Assets

$ 1,550,281,318

Net Assets consist of:

 

Paid in capital

$ 2,173,816,240

Undistributed net investment income

25,333,074

Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions

(563,961,431)

Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies

(84,906,565)

Net Assets

$ 1,550,281,318

Statement of Assets and Liabilities - continued

 

June 30, 2009 (Unaudited)

Initial Class:
Net Asset Value, offering price and redemption price per share ($657,219,527 ÷ 52,435,914 shares)

$ 12.53

 

 

 

Service Class:
Net Asset Value, offering price and redemption price per share ($154,416,938 ÷ 12,375,036 shares)

$ 12.48

 

 

 

Service Class 2:
Net Asset Value, offering price and redemption price per share ($397,270,390 ÷ 31,997,241 shares)

$ 12.42

 

 

 

Initial Class R:
Net Asset Value, offering price and redemption price per share ($111,463,985 ÷ 8,913,201 shares)

$ 12.51

 

 

 

Service Class R:
Net Asset Value, offering price and redemption price per share ($57,643,492 ÷ 4,626,613 shares)

$ 12.46

 

 

 

Service Class 2R:
Net Asset Value, offering price and redemption price per share ($51,472,368 ÷ 4,177,806 shares)

$ 12.32

 

 

 

Investor Class R:
Net Asset Value, offering price and redemption price per share ($120,794,618 ÷ 9,663,347 shares)

$ 12.50

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

Semiannual Report

Statement of Operations

Six months ended June 30, 2009 (Unaudited)

Investment Income

 

 

Dividends

 

$ 33,929,777

Interest

 

3,332

Income from Fidelity Central Funds

 

1,436,664

 

 

35,369,773

Less foreign taxes withheld

 

(3,167,827)

Total income

 

32,201,946

 

 

 

Expenses

Management fee

$ 5,172,864

Transfer agent fees

697,410

Distribution fees

614,476

Accounting and security lending fees

334,691

Custodian fees and expenses

119,056

Independent trustees' compensation

5,856

Appreciation in deferred trustee compensation account

46

Audit

35,488

Legal

22,337

Interest

2,430

Miscellaneous

67,382

Total expenses before reductions

7,072,036

Expense reductions

(168,219)

6,903,817

Net investment income (loss)

25,298,129

Realized and Unrealized Gain (Loss)

Net realized gain (loss) on:

Investment securities:

 

 

Unaffiliated issuers

(302,535,026)

Foreign currency transactions

(624,825)

Total net realized gain (loss)

 

(303,159,851)

Change in net unrealized appreciation (depreciation) on:

Investment securities

312,760,185

Assets and liabilities in foreign currencies

66,250

Total change in net unrealized appreciation (depreciation)

 

312,826,435

Net gain (loss)

9,666,584

Net increase (decrease) in net assets resulting from operations

$ 34,964,713

Statement of Changes in Net Assets

 

Six months ended
June 30, 2009
(Unaudited)

Year ended
December 31,
2008

Increase (Decrease) in Net Assets

 

 

Operations

 

 

Net investment income (loss)

$ 25,298,129

$ 62,527,697

Net realized gain (loss)

(303,159,851)

(249,321,918)

Change in net unrealized appreciation (depreciation)

312,826,435

(1,217,207,504)

Net increase (decrease) in net assets resulting from operations

34,964,713

(1,404,001,725)

Distributions to shareholders from net investment income

-

(61,798,099)

Distributions to shareholders from net realized gain

(2,239,250)

(348,490,470)

Total distributions

(2,239,250)

(410,288,569)

Share transactions - net increase (decrease)

(116,921,368)

(178,683,659)

Redemption fees

13,159

67,067

Total increase (decrease) in net assets

(84,182,746)

(1,992,906,886)

 

 

 

Net Assets

Beginning of period

1,634,464,064

3,627,370,950

End of period (including undistributed net investment income of $25,333,074 and undistributed net investment income of $34,945, respectively)

$ 1,550,281,318

$ 1,634,464,064

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

Semiannual Report

Financial Highlights - Initial Class

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 12.17

$ 25.33

$ 23.96

$ 20.60

$ 17.51

$ 15.59

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .20

.46

.45

.38

.20

.13

Net realized and unrealized gain (loss)

  .18

(10.67)

3.42

3.30

3.10

1.97

Total from investment operations

  .38

(10.21)

3.87

3.68

3.30

2.10

Distributions from net investment income

  -

(.49)

(.84)

(.19)

(.12)

(.18)

Distributions from net realized gain

  (.02)

(2.46)

(1.66)

(.13)

(.09)

-

Total distributions

  (.02)

(2.95)

(2.50)

(.32)

(.21)

(.18)

Redemption fees added to paid in capital E, I

  -

-

-

-

-

-

Net asset value, end of period

$ 12.53

$ 12.17

$ 25.33

$ 23.96

$ 20.60

$ 17.51

Total Return B, C, D

  3.12%

(43.83)%

17.41%

18.09%

19.06%

13.57%

Ratios to Average Net Assets F, H

 

 

 

 

 

 

Expenses before reductions

  .89% A

.87%

.85%

.88%

.89%

.91%

Expenses net of fee waivers, if any

  .89% A

.87%

.85%

.88%

.89%

.91%

Expenses net of all reductions

  .86% A

.84%

.82%

.81%

.82%

.87%

Net investment income (loss)

  3.59% A

2.45%

1.85%

1.76%

1.11%

.80%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 657,220

$ 703,357

$ 1,702,235

$ 1,624,901

$ 1,549,179

$ 1,491,485

Portfolio turnover rate G

  98% A

77%

62%

123%

92%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. 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. Expenses net of fee 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. I Amount represents less than $.01 per share.

Financial Highlights - Service Class

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 12.12

$ 25.23

$ 23.86

$ 20.52

$ 17.44

$ 15.53

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .20

.44

.43

.36

.18

.11

Net realized and unrealized gain (loss)

  .18

(10.61)

3.39

3.28

3.09

1.97

Total from investment operations

  .38

(10.17)

3.82

3.64

3.27

2.08

Distributions from net investment income

  -

(.48)

(.79)

(.17)

(.10)

(.17)

Distributions from net realized gain

  (.02)

(2.46)

(1.66)

(.13)

(.09)

-

Total distributions

  (.02)

(2.94)

(2.45)

(.30)

(.19)

(.17)

Redemption fees added to paid in capital E, I

  -

-

-

-

-

-

Net asset value, end of period

$ 12.48

$ 12.12

$ 25.23

$ 23.86

$ 20.52

$ 17.44

Total Return B, C, D

  3.14%

(43.89)%

17.25%

17.95%

18.97%

13.49%

Ratios to Average Net Assets F, H

 

 

 

 

 

 

Expenses before reductions

  .99% A

.97%

.95%

.98%

.99%

1.01%

Expenses net of fee waivers, if any

  .99% A

.97%

.95%

.98%

.99%

1.01%

Expenses net of all reductions

  .96% A

.94%

.92%

.91%

.92%

.97%

Net investment income (loss)

  3.49% A

2.35%

1.75%

1.66%

1.02%

.69%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 154,417

$ 165,608

$ 366,777

$ 362,060

$ 329,759

$ 322,649

Portfolio turnover rate G

  98% A

77%

62%

123%

92%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. 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. Expenses net of fee 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. I Amount represents less than $.01 per share.

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

Semiannual Report

Financial Highlights - Service Class 2

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 12.07

$ 25.12

$ 23.75

$ 20.43

$ 17.39

$ 15.50

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .19

.40

.39

.33

.14

.08

Net realized and unrealized gain (loss)

  .18

(10.54)

3.37

3.27

3.08

1.97

Total from investment operations

  .37

(10.14)

3.76

3.60

3.22

2.05

Distributions from net investment income

  -

(.45)

(.73)

(.15)

(.09)

(.16)

Distributions from net realized gain

  (.02)

(2.46)

(1.66)

(.13)

(.09)

-

Total distributions

  (.02)

(2.91)

(2.39)

(.28)

(.18)

(.16)

Redemption fees added to paid in capital E, I

  -

-

-

-

-

-

Net asset value, end of period

$ 12.42

$ 12.07

$ 25.12

$ 23.75

$ 20.43

$ 17.39

Total Return B, C, D

  3.07%

(43.96)%

17.05%

17.83%

18.72%

13.31%

Ratios to Average Net Assets F, H

 

 

 

 

 

 

Expenses before reductions

  1.13% A

1.12%

1.10%

1.13%

1.14%

1.16%

Expenses net of fee waivers, if any

  1.13% A

1.12%

1.10%

1.13%

1.14%

1.16%

Expenses net of all reductions

  1.11% A

1.09%

1.07%

1.06%

1.07%

1.12%

Net investment income (loss)

  3.34% A

2.21%

1.60%

1.51%

.79%

.54%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 397,270

$ 414,492

$ 821,943

$ 703,421

$ 502,801

$ 319,708

Portfolio turnover rate G

  98% A

77%

62%

123%

92%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. 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. Expenses net of fee 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. I Amount represents less than $.01 per share.

Financial Highlights - Initial Class R

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 12.14

$ 25.28

$ 23.92

$ 20.57

$ 17.49

$ 15.57

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .20

.46

.45

.38

.19

.12

Net realized and unrealized gain (loss)

  .19

(10.65)

3.41

3.29

3.10

1.98

Total from investment operations

  .39

(10.19)

3.86

3.67

3.29

2.10

Distributions from net investment income

  -

(.49)

(.84)

(.19)

(.12)

(.18)

Distributions from net realized gain

  (.02)

(2.46)

(1.66)

(.13)

(.09)

-

Total distributions

  (.02)

(2.95)

(2.50)

(.32)

(.21)

(.18)

Redemption fees added to paid in capital E, I

  -

-

-

-

-

-

Net asset value, end of period

$ 12.51

$ 12.14

$ 25.28

$ 23.92

$ 20.57

$ 17.49

Total Return B, C, D

  3.21%

(43.84)%

17.40%

18.08%

19.05%

13.59%

Ratios to Average Net Assets F, H

 

 

 

 

 

 

Expenses before reductions

  .89% A

.87%

.85%

.88%

.89%

.91%

Expenses net of fee waivers, if any

  .89% A

.87%

.85%

.88%

.89%

.91%

Expenses net of all reductions

  .86% A

.84%

.82%

.81%

.82%

.87%

Net investment income (loss)

  3.59% A

2.46%

1.85%

1.76%

1.08%

.79%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 111,464

$ 118,749

$ 275,678

$ 240,693

$ 184,245

$ 132,064

Portfolio turnover rate G

  98% A

77%

62%

123%

92%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. 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. Expenses net of fee 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. I Amount represents less than $.01 per share.

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

Semiannual Report

Financial Highlights - Service Class R

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 12.10

$ 25.19

$ 23.83

$ 20.50

$ 17.43

$ 15.52

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .20

.43

.43

.36

.17

.11

Net realized and unrealized gain (loss)

  .18

(10.58)

3.38

3.27

3.09

1.97

Total from investment operations

  .38

(10.15)

3.81

3.63

3.26

2.08

Distributions from net investment income

  -

(.48)

(.79)

(.17)

(.10)

(.17)

Distributions from net realized gain

  (.02)

(2.46)

(1.66)

(.13)

(.09)

-

Total distributions

  (.02)

(2.94)

(2.45)

(.30)

(.19)

(.17)

Redemption fees added to paid in capital E, I

  -

-

-

-

-

-

Net asset value, end of period

$ 12.46

$ 12.10

$ 25.19

$ 23.83

$ 20.50

$ 17.43

Total Return B, C, D

  3.14%

(43.88)%

17.23%

17.95%

18.92%

13.50%

Ratios to Average Net Assets F, H

 

 

 

 

 

 

Expenses before reductions

  .98% A

.96%

.94%

.98%

.99%

1.01%

Expenses net of fee waivers, if any

  .98% A

.96%

.94%

.98%

.99%

1.01%

Expenses net of all reductions

  .96% A

.94%

.92%

.91%

.92%

.96%

Net investment income (loss)

  3.50% A

2.36%

1.75%

1.66%

.96%

.70%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 57,643

$ 61,825

$ 135,038

$ 133,934

$ 115,449

$ 86,509

Portfolio turnover rate G

  98% A

77%

62%

123%

92%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. 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. Expenses net of fee 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. I Amount represents less than $.01 per share.

Financial Highlights - Service Class 2R

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 11.98

$ 24.95

$ 23.61

$ 20.32

$ 17.30

$ 15.42

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .19

.40

.39

.32

.14

.08

Net realized and unrealized gain (loss)

  .17

(10.46)

3.35

3.26

3.07

1.96

Total from investment operations

  .36

(10.06)

3.74

3.58

3.21

2.04

Distributions from net investment income

  -

(.45)

(.74)

(.16)

(.10)

(.16)

Distributions from net realized gain

  (.02)

(2.46)

(1.66)

(.13)

(.09)

-

Total distributions

  (.02)

(2.91)

(2.40)

(.29)

(.19)

(.16)

Redemption fees added to paid in capital E, I

  -

-

-

-

-

-

Net asset value, end of period

$ 12.32

$ 11.98

$ 24.95

$ 23.61

$ 20.32

$ 17.30

Total Return B, C, D

  3.00%

(43.94)%

17.06%

17.81%

18.74%

13.32%

Ratios to Average Net Assets F, H

 

 

 

 

 

 

Expenses before reductions

  1.13% A

1.11%

1.09%

1.13%

1.14%

1.16%

Expenses net of fee waivers, if any

  1.13% A

1.11%

1.09%

1.13%

1.14%

1.16%

Expenses net of all reductions

  1.11% A

1.09%

1.07%

1.06%

1.07%

1.11%

Net investment income (loss)

  3.35% A

2.21%

1.60%

1.51%

.77%

.55%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 51,472

$ 46,323

$ 95,871

$ 68,729

$ 49,373

$ 27,562

Portfolio turnover rate G

  98% A

77%

62%

123%

92%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. 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. Expenses net of fee 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. I Amount represents less than $.01 per share.

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

Semiannual Report

Financial Highlights - Investor Class R

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005 H

Selected Per-Share Data

 

 

 

 

 

Net asset value, beginning of period

$ 12.14

$ 25.27

$ 23.91

$ 20.59

$ 17.69

Income from Investment Operations

 

 

 

 

 

Net investment income (loss) E

  .20

.43

.42

.36

.02

Net realized and unrealized gain (loss)

  .18

(10.62)

3.41

3.29

2.88

Total from investment operations

  .38

(10.19)

3.83

3.65

2.90

Distributions from net investment income

  -

(.48)

(.81)

(.20)

-

Distributions from net realized gain

  (.02)

(2.46)

(1.66)

(.13)

-

Total distributions

  (.02)

(2.94)

(2.47)

(.33)

-

Redemption fees added to paid in capital E, J

  -

-

-

-

-

Net asset value, end of period

$ 12.50

$ 12.14

$ 25.27

$ 23.91

$ 20.59

Total Return B, C, D

  3.13%

(43.89)%

17.25%

17.94%

16.39%

Ratios to Average Net Assets F, I

 

 

 

 

 

Expenses before reductions

  .99% A

.96%

.96%

1.01%

1.07% A

Expenses net of fee waivers, if any

  .99% A

.96%

.96%

1.01%

1.07% A

Expenses net of all reductions

  .97% A

.93%

.94%

.93%

1.00% A

Net investment income (loss)

  3.48% A

2.36%

1.74%

1.64%

.23% A

Supplemental Data

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 120,795

$ 124,111

$ 229,829

$ 122,018

$ 29,544

Portfolio turnover rate G

  98% A

77%

62%

123%

92%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H For the period July 21, 2005 (commencement of sale of shares) to December 31, 2005. I 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 fee 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. J Amount represents less than $.01 per share.

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

Semiannual Report

Notes to Financial Statements

For the period ended June 30, 2009 (Unaudited)

1. Organization.

VIP Overseas Portfolio (the Fund) is a fund of Variable Insurance Products Fund (the trust) and is authorized to issue an unlimited number of shares. The trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. Shares of the Fund may only be purchased by insurance companies for the purpose of funding variable annuity or variable life insurance contracts. The Fund offers the following classes of shares: Initial Class shares, Service Class shares, Service Class 2 shares, Initial Class R shares, Service Class R shares, Service Class 2R shares, and Investor Class R 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 transfer agent and distribution and service plan fees incurred. Certain expense reductions also differ by class.

2. Investments in Fidelity Central Funds.

The Fund may invest in Fidelity Central Funds, which are open-end investment companies available only to other investment companies and accounts managed by Fidelity Management & Research Company (FMR) and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.

The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of FMR.

A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the SEC's web site at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC's web site or upon request.

3. Significant Accounting Policies.

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. Actual results could differ from those estimates. Events or transactions occurring after period end through the date that the financial statements were issued, August 13, 2009, have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:

Security Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Fund uses independent pricing services approved by the Board of Trustees to value its investments. Generally Accepted Accounting Principles (GAAP) establishes a disclosure hierarchy that categorizes the inputs to valuation techniques used to value assets and liabilities at measurement date. These inputs are classified into three levels. Level 1 includes readily available unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 includes observable inputs other than quoted prices included in Level 1 that are observable either directly or indirectly. Level 3 includes unobservable inputs when market prices are not readily available or reliable. Changes in valuation techniques may result in transfers in or out of an investment's assigned level within the hierarchy. The aggregate value by input level, as of June 30, 2009, for the Fund's investments, as well as a reconciliation of assets and liabilities for which significant unobservable inputs (Level 3) were used in determining value, is included at the end of the Fund's Schedule of Investments. Valuation techniques of the Fund's major categories of assets and liabilities as presented in the Schedule of Investments are as follows.

Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by an independent pricing service on the primary market or exchange on which they are traded. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price. Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value each business day. Short-term securities with remaining maturities of sixty days or less for which quotations are not readily available are valued at amortized cost, which approximates value.

When current market prices or quotations are not readily available or reliable, valuations may be determined in good faith in accordance with procedures adopted by the Board of Trustees. Factors used in determining value may include significant market or security specific events, changes in interest rates and credit quality, and developments in foreign markets which are monitored by evaluating the performance of ADRs, futures contracts and exchange-traded funds. The frequency with which these procedures are used cannot be predicted and may be utilized to a significant extent. The value of securities used for net asset value (NAV) calculation under these procedures may differ from published prices for the same securities.

Foreign Currency. The Fund uses 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.

Semiannual Report

Notes to Financial Statements (Unaudited) - continued

3. Significant Accounting Policies - continued

Foreign Currency - continued

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. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. 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 Fund is 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. Interest income and distributions from the Fidelity Central Funds are accrued as earned. Interest income includes coupon interest and amortization of premium and accretion of discount on debt securities. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.

Expenses. Most expenses of the trust can be directly attributed to a fund. Expenses which cannot be directly attributed are apportioned among each Fund in the trust. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.

Deferred Trustee Compensation. Under a Deferred Compensation Plan (the Plan), independent 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 invested in a cross-section of Fidelity funds, are marked-to-market and remain in the Fund until distributed in accordance with the Plan. The investment of deferred amounts and the offsetting payable to the Trustees are included in the accompanying Statement of Assets and Liabilities.

Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company by distributing substantially all of its taxable income and realized gains under Subchapter M of the Internal Revenue Code and filing its U.S. federal tax return. As a result, no provision for income taxes is required. The Fund is subject to the provisions of FASB Interpretation No. 48, Accounting for Uncertainties in Income Taxes (FIN 48). FIN 48 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. There are no unrecognized tax benefits in the accompanying financial statements. A Fund's federal tax return is subject to examination by the Internal Revenue Service (IRS) for a period of three years. Foreign taxes are provided for based on the 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 foreign currency transactions, certain foreign taxes, passive foreign investment companies (PFIC), deferred trustees compensation, capital loss carryforwards and losses deferred due to wash sales.

The federal tax cost of investments and unrealized appreciation (depreciation) as of period end were as follows:

Unrealized appreciation

$ 186,033,822

Unrealized depreciation

(294,587,953)

Net unrealized appreciation (depreciation)

$ (108,554,131)

Cost for federal income tax purposes

$ 1,704,688,174

Trading (Redemption) Fees. Initial Class R shares, Service Class R shares, Service Class 2R shares and Investor Class R 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 Fund and accounted for as an addition to paid in capital.

4. Purchases and Sales of Investments.

Purchases and sales of securities, other than short-term securities, aggregated $710,486,739 and $771,257,458, respectively.

Semiannual Report

5. Fees and Other Transactions with Affiliates.

Management Fee. FMR and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .45% of the Fund's average net assets and a group fee rate that averaged .27% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by FMR. The group fee rate decreases as assets under management increase and increases as assets under management decrease. For the period, the total annualized management fee rate was .72% of the Fund's average net assets.

Distribution and Service Plan. In accordance with Rule 12b-1 of the 1940 Act, the Fund has 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's 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

$ 72,367

Service Class 2

459,544

Service Class R

26,939

Service Class 2R

55,626

 

$ 614,476

Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc. (FIIOC), an affiliate of FMR, is the Fund's transfer, dividend disbursing, and shareholder servicing agent. FIIOC receives an asset-based fee with respect to each class. Each class (with the exception of Investor Class R) pays a transfer agent fee, excluding out of pocket expenses, equal to an annual rate of .07% of average net assets. Investor Class R pays a monthly asset-based transfer agent fee of .15% of average net assets. The total transfer agent fees paid by each class to FIIOC, including out of pocket expenses, were as follows:

Initial Class

$ 277,703

Service Class

63,997

Service Class 2

160,374

Initial Class R

45,470

Service Class R

22,867

Service Class 2R

18,679

Investor Class R

108,320

 

$ 697,410

Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of FMR, maintains the 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.

Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. The commissions paid to these affiliated firms were $958 for the period.

Interfund Lending Program. Pursuant to an Exemptive Order issued by the Securities and Exchange Commission (the SEC), the Fund, 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 affiliated funds. At period end, there were no interfund loans outstanding. The Fund's activity in this program during the period for which loans were outstanding was as follows:

Borrower or Lender

Average Daily
Loan Balance

WeightedAverage
Interest Rate

Interest
Expense

Borrower

$ 5,975,625

.48%

$ 1,918

6. Committed Line of Credit.

The Fund participates with other funds managed by FMR in a $3.5 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 Fund has agreed to pay commitment fees on its pro-rata portion of the line of credit, which amounted to $4,685 and is reflected in Miscellaneous Expense on the Statement of Operations. During the period, there were no borrowings on this line of credit.

Semiannual Report

Notes to Financial Statements (Unaudited) - continued

7. Security Lending.

The Fund lends portfolio securities from time to time in order to earn additional income. On the settlement date of the loan, the 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 Fund and any additional required collateral is delivered to the Fund 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. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. Security lending income represents the income earned on investing cash collateral, less fees and expenses associated with the loan, plus any premium payments that may be received on the loan of certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds. Net income from lending portfolio securities during the period amounted to $1,401,687.

8. Bank Borrowings.

The Fund is permitted to have bank borrowings for temporary or emergency purposes to fund shareholder redemptions. The 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. The average daily loan balance during the period for which loans were outstanding amounted to $11,933,500. The weighted average interest rate was .77%. The interest expense amounted to $512 under the bank borrowing program. At period end, there were no bank borrowings outstanding.

9. Expense Reductions.

Many of the brokers with whom FMR places trades on behalf of the Fund provided services to the Fund in addition to trade execution. These services included payments of certain expenses on behalf of the Fund totaling $168,170 for the period. In addition, through arrangements with the Fund's custodian, credits realized as a result of uninvested cash balances were used to reduce the Fund's expenses. During the period, these credits reduced the Fund's custody expenses by $49.

10. Distributions to Shareholders.

Distributions to shareholders of each class were as follows:

 

Six months ended
June 30,
2009

Year ended
December 31,
2008

From net investment income

 

 

Initial Class

$ -

$ 27,449,630

Service Class

-

6,285,159

Service Class 2

-

14,726,472

Initial Class R

-

4,651,583

Service Class R

-

2,342,494

Service Class 2R

-

1,653,621

Investor Class R

-

4,689,140

Total

$ -

$ 61,798,099

 

From net realized gain

 

 

Initial Class

$ 961,601

$ 163,022,999

Service Class

226,832

34,891,161

Service Class 2

568,192

79,417,694

Initial Class R

160,788

26,045,726

Service Class R

84,356

12,931,868

Service Class 2R

65,956

9,495,528

Investor Class R

171,525

22,685,494

Total

$ 2,239,250

$ 348,490,470

Semiannual Report

11. Share Transactions.

Transactions for each class of shares were as follows:

 

Shares

Dollars

Six months ended
June 30,
2009

Year ended
December 31,
2008

Six months ended
June 30,
2009

Year ended
December 31,
2008

Initial Class

 

 

 

 

Shares sold

2,985,818

5,742,422

$ 34,885,861

$ 105,330,600

Reinvestment of distributions

90,291

10,416,592

961,601

190,472,629

Shares redeemed

(8,447,579)

(25,565,528)

(96,308,449)

(491,629,057)

Net increase (decrease)

(5,371,470)

(9,406,514)

$ (60,460,987)

$ (195,825,828)

Service Class

 

 

 

 

Shares sold

452,151

1,370,007

$ 5,057,359

$ 23,974,828

Reinvestment of distributions

21,379

2,274,580

226,832

41,176,320

Shares redeemed

(1,763,267)

(4,518,541)

(19,218,830)

(82,046,840)

Net increase (decrease)

(1,289,737)

(873,954)

$ (13,934,639)

$ (16,895,692)

Service Class 2

 

 

 

 

Shares sold

1,898,110

5,449,407

$ 20,660,039

$ 97,500,340

Reinvestment of distributions

53,806

5,238,634

568,192

94,144,166

Shares redeemed

(4,301,489)

(9,062,599)

(47,308,634)

(161,377,161)

Net increase (decrease)

(2,349,573)

1,625,442

$ (26,080,403)

$ 30,267,345

Initial Class R

 

 

 

 

Shares sold

316,104

600,161

$ 3,474,061

$ 11,570,605

Reinvestment of distributions

15,126

1,690,588

160,788

30,697,309

Shares redeemed

(1,199,814)

(3,415,687)

(12,897,002)

(60,745,148)

Net increase (decrease)

(868,584)

(1,124,938)

$ (9,262,153)

$ (18,477,234)

Service Class R

 

 

 

 

Shares sold

176,134

517,294

$ 2,001,305

$ 9,780,288

Reinvestment of distributions

7,966

845,462

84,356

15,274,362

Shares redeemed

(666,736)

(1,613,463)

(7,236,144)

(28,583,442)

Net increase (decrease)

(482,636)

(250,707)

$ (5,150,483)

$ (3,528,792)

Service Class 2R

 

 

 

 

Shares sold

645,276

716,923

$ 7,000,163

$ 13,560,422

Reinvestment of distributions

6,293

621,801

65,956

11,149,149

Shares redeemed

(341,987)

(1,313,080)

(3,676,530)

(23,348,326)

Net increase (decrease)

309,582

25,644

$ 3,389,589

$ 1,361,245

Investor Class R

 

 

 

 

Shares sold

421,348

1,767,383

$ 4,883,936

$ 32,933,570

Reinvestment of distributions

16,136

1,527,774

171,525

27,374,634

Shares redeemed

(996,216)

(2,169,278)

(10,477,753)

(35,892,907)

Net increase (decrease)

(558,732)

1,125,879

$ (5,422,292)

$ 24,415,297

12. Other.

The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund's maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

At the end of the period, FMR or its affiliates were the owners of record of 16% of the total outstanding shares of the Fund and two otherwise unaffiliated shareholders were the owners of record of 36% of the total outstanding shares of the Fund.

Semiannual Report

Investment Adviser

Fidelity Management & Research Company
Boston, MA

Investment Sub-Advisers

FMR Co., Inc.

Fidelity Management & Research (U.K.) Inc.

Fidelity Research & Analysis Company

FIL Investment Advisors

FIL Investment Advisors (U.K.) Ltd.

Fidelity Investments Japan Limited

Fidelity Management & Research (Japan) Inc.

Fidelity Management & Research (Hong Kong) Limited

General Distributor

Fidelity Distributors Corporation
Boston, MA

Transfer and Service Agents

Fidelity Investments Institutional Operations Company, Inc.
Boston, MA 

Fidelity Service Company, Inc.
Boston, MA 

Custodian

JPMorgan Chase Bank
New York, NY 

VIPOVRS-SANN-0809
1.705696.111

Fidelity® Variable Insurance Products:
Overseas Portfolio - Class R

Semiannual Report

June 30, 2009

(2_fidelity_logos) (Registered_Trademark)

Contents

Shareholder Expense Example

<Click Here>

An example of shareholder expenses.

Investment Changes

<Click Here>

A summary of major shifts in the fund's investments over the past six months.

Investments

<Click Here>

A complete list of the fund's investments with their market values.

Financial Statements

<Click Here>

Statements of assets and liabilities, operations, and changes in net assets, as well as financial highlights.

Notes

<Click Here>

Notes to the financial statements.

To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov. You may also call 1-877-208-0098 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 LLC or an affiliated company.

This report and the financial statements contained herein are submitted for the general information of the shareholders of the fund. This report is not authorized for distribution to prospective investors in the fund 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 holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com or http://www.advisor.fidelity.com, as applicable.

NOT FDIC INSURED · MAY LOSE VALUE · NO BANK GUARANTEE

Neither the fund nor Fidelity Distributors Corporation is a bank.

Semiannual Report

Shareholder Expense Example

As a shareholder of the 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 Fund 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 (January 1, 2009 to June 30, 2009).

Actual Expenses

The first line of the accompanying table for each class of the 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. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.

Hypothetical Example for Comparison Purposes

The second line of the accompanying table for each class of the 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. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.

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.

 



Annualized
Expense Ratio


Beginning
Account Value
January 1, 2009


Ending
Account Value
June 30, 2009

Expenses Paid
During Period*
January 1, 2009 to
June 30, 2009

Initial Class

.89%

 

 

 

Actual

 

$ 1,000.00

$ 1,031.20

$ 4.48

Hypothetical A

 

$ 1,000.00

$ 1,020.38

$ 4.46

Service Class

.99%

 

 

 

Actual

 

$ 1,000.00

$ 1,031.40

$ 4.99

Hypothetical A

 

$ 1,000.00

$ 1,019.89

$ 4.96

Service Class 2

1.13%

 

 

 

Actual

 

$ 1,000.00

$ 1,030.70

$ 5.69

Hypothetical A

 

$ 1,000.00

$ 1,019.19

$ 5.66

Initial Class R

.89%

 

 

 

Actual

 

$ 1,000.00

$ 1,032.10

$ 4.48

Hypothetical A

 

$ 1,000.00

$ 1,020.38

$ 4.46

Service Class R

.98%

 

 

 

Actual

 

$ 1,000.00

$ 1,031.40

$ 4.94

Hypothetical A

 

$ 1,000.00

$ 1,019.93

$ 4.91

Service Class 2R

1.13%

 

 

 

Actual

 

$ 1,000.00

$ 1,030.00

$ 5.69

Hypothetical A

 

$ 1,000.00

$ 1,019.19

$ 5.66

Investor Class R

.99%

 

 

 

Actual

 

$ 1,000.00

$ 1,031.30

$ 4.99

Hypothetical A

 

$ 1,000.00

$ 1,019.89

$ 4.96

A 5% return per year before expenses

* Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).

Semiannual Report

Investment Changes (Unaudited)

Geographic Diversification (% of fund's net assets)

As of June 30, 2009

fid4756

United Kingdom

23.0%

 

fid4758

Japan

17.5%

 

fid4760

France

11.3%

 

fid4762

Germany

10.0%

 

fid4764

Switzerland

7.1%

 

fid4766

Hong Kong

3.4%

 

fid4768

Australia

3.3%

 

fid4770

Spain

3.2%

 

fid4772

United States of America

3.1%

 

fid4774

Other

18.1%

 

fid4805

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

As of December 31, 2008

fid4756

United Kingdom

25.1%

 

fid4758

Japan

19.0%

 

fid4760

France

12.3%

 

fid4762

Switzerland

9.6%

 

fid4764

Germany

8.3%

 

fid4766

United States of America

5.7%

 

fid4768

Australia

3.6%

 

fid4814

Italy

3.3%

 

fid4772

Netherlands

2.7%

 

fid4774

Other

10.4%

 

fid4818

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

Asset Allocation

 

% of fund's
net assets

% of fund's net assets
6 months ago

Stocks

99.9

98.0

Short-Term Investments and Net Other Assets

0.1

2.0

Top Ten Stocks as of June 30, 2009

 

% of fund's
net assets

% of fund's net assets
6 months ago

Nestle SA (Reg.)
(Switzerland, Food Products)

2.5

2.9

HSBC Holdings PLC (United Kingdom, Commercial Banks)

2.1

1.2

Vodafone Group PLC (United Kingdom, Wireless Telecommunication Services)

2.0

2.0

Toyota Motor Corp. (Japan, Automobiles)

1.9

1.3

Total SA (France, Oil, Gas & Consumable Fuels)

1.9

1.8

Roche Holding AG (participation certificate) (Switzerland, Pharmaceuticals)

1.7

1.9

Novo Nordisk AS (Denmark, Pharmaceuticals)

1.4

1.1

Mitsubishi UFJ Financial Group, Inc. (Japan, Commercial Banks)

1.4

1.6

Anheuser-Busch InBev NV (Belgium, Beverages)

1.4

0.5

BP PLC (United Kingdom, Oil, Gas & Consumable Fuels)

1.3

1.8

 

17.6

Market Sectors as of June 30, 2009

 

% of fund's
net assets

% of fund's net assets
6 months ago

Financials

28.0

23.3

Consumer Staples

11.6

14.5

Consumer Discretionary

11.0

9.8

Energy

8.7

8.5

Materials

8.7

4.8

Information Technology

7.4

5.0

Industrials

7.4

5.2

Health Care

6.9

11.9

Telecommunication Services

6.7

8.5

Utilities

3.5

6.5

Semiannual Report

Investments June 30, 2009 (Unaudited)

Showing Percentage of Net Assets

Common Stocks - 99.9%

Shares

Value

Australia - 3.3%

AMP Ltd.

1,043,407

$ 4,102,484

ASX Ltd.

96,059

2,862,831

Australia & New Zealand Banking Group Ltd.

234,901

3,120,893

BHP Billiton Ltd.

367,953

10,079,130

Commonwealth Bank of Australia

227,607

7,151,935

National Australia Bank Ltd.

266,905

4,825,618

Newcrest Mining Ltd.

120,084

2,951,894

Rio Tinto Ltd.

79,200

3,330,957

Rio Tinto Ltd. rights 7/1/09 (a)(d)

41,580

801,009

Seek Ltd.

593,800

1,995,031

Wesfarmers Ltd.

93,194

1,700,707

Westfield Group unit

910,199

8,345,493

TOTAL AUSTRALIA

51,267,982

Belgium - 1.6%

Anheuser-Busch InBev NV

589,100

21,269,749

Fortis (a)

370,100

1,261,508

Hamon & Compagnie International SA

73,974

2,402,121

TOTAL BELGIUM

24,933,378

Bermuda - 0.5%

Clear Media Ltd. (a)

249,000

100,886

Lancashire Holdings Ltd. (a)

387,200

2,971,615

Signet Jewelers Ltd. (United Kingdom)

197,365

3,984,008

TOTAL BERMUDA

7,056,509

Brazil - 0.7%

TIM Participacoes SA sponsored ADR (non-vtg.) (d)

303,600

5,291,748

Vivo Participacoes SA sponsored ADR

294,700

5,581,618

TOTAL BRAZIL

10,873,366

Canada - 0.7%

Canadian Natural Resources Ltd.

85,600

4,503,365

Open Text Corp. (a)

59,700

2,181,455

Suncor Energy, Inc.

142,400

4,330,400

TOTAL CANADA

11,015,220

Cayman Islands - 0.1%

Himax Technologies, Inc. sponsored ADR

503,300

1,887,375

China - 0.7%

Baidu.com, Inc. sponsored ADR (a)

16,400

4,937,876

China Merchants Bank Co. Ltd. (H Shares)

650

1,488

China Telecom Corp. Ltd. (H Shares)

6,870,000

3,409,951

Parkson Retail Group Ltd.

1,296,500

1,853,601

TOTAL CHINA

10,202,916

Denmark - 1.8%

Danske Bank AS (a)

96,100

1,656,444

Novo Nordisk AS:

Series B

224,400

12,132,129

 

Shares

Value

Series B sponsored ADR

179,400

$ 9,770,124

Vestas Wind Systems AS (a)

52,200

3,741,601

TOTAL DENMARK

27,300,298

Finland - 0.5%

Nokia Corp. sponsored ADR

529,200

7,715,736

France - 11.3%

Accor SA (d)

145,877

5,781,585

Alstom SA (d)

132,400

7,810,349

AXA SA

179,815

3,402,971

AXA SA sponsored ADR

158,600

3,007,056

BNP Paribas SA

253,653

16,455,707

Carrefour SA

88,000

3,754,972

CNP Assurances

44,000

4,200,273

Credit Agricole SA

159,900

1,990,813

Danone

281,216

13,877,176

Electricite de France

58,800

2,859,951

Essilor International SA

70,800

3,374,593

Iliad Group SA

28,200

2,734,912

Ingenico SA

246,990

4,711,778

Ipsos SA (d)

113,100

2,839,752

L'Air Liquide SA

34,178

3,121,470

Lafarge SA (Bearer)

72,300

4,893,284

Laurent-Perrier Group

21,000

1,443,378

Michelin SA (Compagnie Generale des Etablissements) Series B

53,000

3,018,702

Nexity

61,400

1,831,034

Pernod Ricard SA (d)

125,510

7,899,493

Remy Cointreau SA

54,000

1,954,242

Sanofi-Aventis sponsored ADR

306,800

9,047,532

Societe Generale Series A

217,741

11,876,463

Total SA:

Series B

286,700

15,537,592

sponsored ADR

249,200

13,514,116

Unibail-Rodamco

102,400

15,248,449

Vallourec SA

33,700

4,090,359

Veolia Environnement

162,797

4,793,179

TOTAL FRANCE

175,071,181

Germany - 10.0%

Allianz AG (Reg.)

77,600

7,146,652

BASF AG

117,800

4,681,194

Bayer AG

157,900

8,465,208

Bayerische Motoren Werke AG (BMW)

221,800

8,350,430

Commerzbank AG (a)(d)

135,300

840,749

Daimler AG

144,800

5,251,896

Daimler AG (Reg.)

130,200

4,722,366

Deutsche Bank AG

122,400

7,466,600

Deutsche Bank AG (NY Shares)

62,000

3,782,000

Deutsche Boerse AG

207,400

16,082,057

Deutsche Post AG

176,800

2,302,656

Deutsche Telekom AG (Reg.)

207,500

2,448,573

E.ON AG

579,032

20,483,891

Common Stocks - continued

Shares

Value

Germany - continued

Fresenius SE

113,800

$ 5,326,762

Metro AG

310,800

14,831,331

Munich Re Group (Reg.)

83,000

11,198,834

Q-Cells SE (a)

81,400

1,655,607

SAP AG

173,200

6,961,130

SAP AG sponsored ADR (d)

154,600

6,213,374

Siemens AG (Reg.)

105,300

7,285,832

Vossloh AG

73,300

8,796,072

TOTAL GERMANY

154,293,214

Hong Kong - 3.4%

China Unicom (Hong Kong) Ltd. sponsored ADR

458,800

6,120,392

Hang Lung Properties Ltd.

2,089,000

6,914,005

Hang Seng Bank Ltd.

131,600

1,850,914

Hong Kong Exchange & Clearing Ltd.

1,182,100

18,410,492

Hutchison Whampoa Ltd.

1,518,000

9,920,993

Swire Pacific Ltd. (A Shares)

911,500

9,197,448

TOTAL HONG KONG

52,414,244

Indonesia - 0.0%

PT Indosat Tbk sponsored ADR

17,618

429,703

Ireland - 1.1%

CRH PLC

505,578

11,559,541

Paddy Power PLC (Ireland)

229,500

5,343,866

TOTAL IRELAND

16,903,407

Israel - 0.3%

Teva Pharmaceutical Industries Ltd. sponsored ADR

84,800

4,184,032

Italy - 2.3%

Bulgari SpA

452,000

2,415,618

ENI SpA

405,486

9,615,881

ENI SpA sponsored ADR

134,300

6,367,163

Intesa Sanpaolo SpA (a)

3,187,500

10,261,189

Tod's SpA

43,100

2,454,529

UniCredit SpA (a)

1,885,438

4,747,244

TOTAL ITALY

35,861,624

Japan - 17.5%

Asahi Glass Co. Ltd.

234,000

1,882,493

Canon, Inc.

218,000

7,120,753

Canon, Inc. sponsored ADR

188,900

6,144,917

Denso Corp.

334,800

8,618,923

East Japan Railway Co.

65,900

3,974,454

Eisai Co. Ltd.

136,500

4,874,241

Fanuc Ltd.

60,300

4,857,300

Fast Retailing Co. Ltd.

12,400

1,621,840

Hitachi Ltd.

365,000

1,135,886

Honda Motor Co. Ltd.

405,400

11,152,898

Hoya Corp.

95,000

1,909,171

Japan Retail Fund Investment Corp.

568

2,629,657

Japan Tobacco, Inc.

474

1,485,940

 

Shares

Value

JFE Holdings, Inc.

123,900

$ 4,179,945

JTEKT Corp.

363,100

3,697,525

Jupiter Telecommunications Co.

3,815

2,898,822

Kao Corp.

187,000

4,086,106

Konica Minolta Holdings, Inc.

346,000

3,620,366

Mitsubishi Corp.

150,800

2,798,883

Mitsubishi Electric Corp.

765,000

4,851,975

Mitsubishi Estate Co. Ltd.

486,000

8,127,326

Mitsubishi UFJ Financial Group, Inc.

3,523,200

21,755,042

Mitsui & Co. Ltd.

393,600

4,682,261

Mitsui Sumitomo Insurance Group Holdings, Inc.

85,100

2,239,357

Murata Manufacturing Co. Ltd.

116,000

4,936,939

Nippon Telegraph & Telephone Corp.

109,700

4,467,578

Nomura Holdings, Inc.

1,216,800

10,270,821

NTT DoCoMo, Inc.

2,139

3,128,582

Omron Corp.

323,200

4,680,168

ORIX Corp.

25,240

1,522,234

Osaka Gas Co. Ltd.

480,000

1,534,645

Point, Inc.

31,970

1,719,049

Promise Co. Ltd. (d)

398,900

5,105,556

Rakuten, Inc.

11,228

6,771,649

Ricoh Co. Ltd.

789,000

10,196,761

Seven & i Holdings Co., Ltd.

170,500

4,017,595

Sharp Corp.

473,000

4,924,679

Shin-Etsu Chemical Co., Ltd.

76,300

3,548,285

Shiseido Co. Ltd.

85,000

1,395,858

Shizuoka Bank Ltd.

233,000

2,314,642

SMC Corp.

44,500

4,799,450

Softbank Corp.

85,600

1,672,281

Sony Corp.

98,600

2,572,377

Sony Corp. sponsored ADR

34,500

892,170

Sugi Holdings Co. Ltd.

130,700

2,693,097

Sumitomo Corp.

457,900

4,667,647

Sumitomo Metal Industries Ltd.

1,545,000

4,121,711

Sumitomo Mitsui Financial Group, Inc.

342,700

13,980,495

T&D Holdings, Inc.

186,650

5,366,902

Tokio Marine Holdings, Inc.

128,400

3,511,740

Tokyo Electron Ltd.

68,900

3,340,042

Toyota Motor Corp.

541,100

20,462,978

Toyota Motor Corp. sponsored ADR

120,500

9,101,365

Yahoo! Japan Corp. (d)

12,647

4,036,905

TOTAL JAPAN

272,100,282

Luxembourg - 1.1%

ArcelorMittal SA (NY Shares) Class A

266,600

8,819,128

SES SA (A Shares) FDR unit

451,647

8,552,591

TOTAL LUXEMBOURG

17,371,719

Netherlands - 2.1%

Aegon NV

266,600

1,639,066

ASML Holding NV (NY Shares)

146,200

3,165,230

Gemalto NV (a)

88,800

3,071,644

Common Stocks - continued

Shares

Value

Netherlands - continued

ING Groep NV (Certificaten Van Aandelen)

211,700

$ 2,144,505

Koninklijke Ahold NV

449,100

5,155,532

Koninklijke KPN NV

519,200

7,136,434

Koninklijke Philips Electronics NV

203,200

3,751,274

Randstad Holdings NV (a)

116,500

3,221,718

Royal DSM NV

57,600

1,804,164

STMicroelectronics NV

234,200

1,765,309

TOTAL NETHERLANDS

32,854,876

Netherlands Antilles - 0.2%

Schlumberger Ltd. (NY Shares)

44,800

2,424,128

Norway - 1.1%

DnB Nor ASA (a)

324,400

2,471,254

Norsk Hydro ASA (a)

310,000

1,590,436

Pronova BioPharma ASA (a)

721,300

1,917,576

StatoilHydro ASA

320,900

6,316,026

StatoilHydro ASA sponsored ADR

242,400

4,792,248

TOTAL NORWAY

17,087,540

Papua New Guinea - 0.6%

Lihir Gold Ltd. (a)

2,218,776

5,273,620

Oil Search Ltd.

837,360

3,683,649

TOTAL PAPUA NEW GUINEA

8,957,269

Singapore - 0.8%

Singapore Exchange Ltd.

1,842,000

9,029,412

United Overseas Bank Ltd.

390,000

3,952,775

TOTAL SINGAPORE

12,982,187

South Africa - 1.1%

Aspen Pharmacare Holdings Ltd.

565,600

4,015,639

Impala Platinum Holdings Ltd.

201,200

4,447,194

MTN Group Ltd.

563,100

8,639,092

TOTAL SOUTH AFRICA

17,101,925

Spain - 3.2%

Banco Bilbao Vizcaya Argentaria SA

135,700

1,708,479

Banco Santander SA

1,066,600

12,891,811

EDP Renovaveis SA

492,400

5,042,033

Iberdrola SA

465,000

3,770,037

Iberdrola SA

304,100

2,388,742

Inditex SA

81,000

3,882,351

Telefonica SA

814,580

18,496,750

Telefonica SA sponsored ADR

25,900

1,758,351

TOTAL SPAIN

49,938,554

Sweden - 0.4%

Nordea Bank AB

188,800

1,495,140

Skandinaviska Enskilda Banken AB (A Shares) (a)

327,600

1,439,403

 

Shares

Value

Svenska Handelsbanken AB (A Shares)

98,900

$ 1,868,287

Telefonaktiebolaget LM Ericsson (B Shares) sponsored ADR

203,100

1,986,318

TOTAL SWEDEN

6,789,148

Switzerland - 7.1%

ABB Ltd. sponsored ADR

374,900

5,915,922

Adecco SA (Reg.)

115,101

4,795,169

Compagnie Financiere Richemont Series A

281,660

5,854,089

Credit Suisse Group sponsored ADR

117,600

5,377,848

Credit Suisse Group (Reg.)

165,985

7,605,818

Nestle SA (Reg.)

1,025,750

38,635,568

Roche Holding AG (participation certificate)

188,245

25,592,587

Swiss Reinsurance Co. (Reg.)

65,532

2,167,912

UBS AG:

(For. Reg.) (a)

447,317

5,493,102

(NY Shares) (a)

191,543

2,338,740

Zurich Financial Services AG (Reg.)

39,551

6,968,024

TOTAL SWITZERLAND

110,744,779

Taiwan - 0.4%

Hon Hai Precision Industry Co. Ltd. (Foxconn)

874,000

2,699,665

Taiwan Semiconductor Manufacturing Co. Ltd. sponsored ADR

414,100

3,896,681

TOTAL TAIWAN

6,596,346

United Kingdom - 23.0%

Aegis Group PLC

2,629,334

3,979,597

Anglo American PLC:

ADR

404,400

5,920,416

(United Kingdom)

315,908

9,165,192

AstraZeneca PLC:

(United Kingdom)

90,500

3,990,252

sponsored ADR

189,400

8,360,116

Aviva PLC

519,200

2,916,963

BAE Systems PLC

450,800

2,510,430

Barclays PLC

1,612,200

7,491,752

Barclays PLC Sponsored ADR (d)

214,200

3,949,848

BG Group PLC

596,700

9,993,309

BHP Billiton PLC

795,495

17,850,785

BP PLC

2,628,406

20,768,562

British Land Co. PLC

1,032,100

6,486,205

Cairn Energy PLC (a)

126,300

4,866,265

Centrica PLC

2,184,600

8,014,608

Diageo PLC

1,175,300

16,880,480

GlaxoSmithKline PLC

295,600

5,221,122

Hammerson PLC (d)

684,500

3,457,143

Hays PLC

1,754,300

2,474,819

Hikma Pharmaceuticals PLC

223,300

1,724,765

HSBC Holdings PLC:

(United Kingdom) (Reg.)

915,380

7,625,966

sponsored ADR (d)

584,932

24,432,610

Common Stocks - continued

Shares

Value

United Kingdom - continued

Imperial Tobacco Group PLC

276,700

$ 7,183,261

Informa PLC

1,875,580

6,757,487

InterContinental Hotel Group PLC

303,900

3,114,758

Intertek Group PLC

146,000

2,505,202

Jardine Lloyd Thompson Group PLC

1,201,473

7,970,653

Johnson Matthey PLC

229,700

4,349,525

Land Securities Group PLC

373,700

2,897,210

Lloyds TSB Group PLC

1,863,744

2,144,151

Man Group PLC

1,312,125

5,990,233

Marks & Spencer Group PLC

1,273,000

6,408,484

Prudential PLC

709,900

4,829,233

Reed Elsevier PLC

404,214

3,009,092

Rio Tinto PLC:

rights 7/1/09 (a)

20,475

235,118

(Reg.)

39,000

1,350,586

sponsored ADR

60,400

9,897,748

Royal Bank of Scotland Group PLC

3,404,900

2,164,447

Royal Dutch Shell PLC:

Class A (United Kingdom)

547,000

13,660,437

Class A sponsored ADR

189,600

9,516,024

Class B

236,000

5,941,223

Scottish & Southern Energy PLC

327,000

6,127,411

Standard Chartered PLC (United Kingdom)

702,400

13,173,308

Sthree PLC

229,400

683,089

Tesco PLC

935,900

5,444,365

The Restaurant Group PLC

446,300

1,049,950

Vodafone Group PLC

13,676,462

26,599,116

Vodafone Group PLC sponsored ADR

228,800

4,459,312

William Hill PLC

1,869,858

6,044,727

William Morrison Supermarkets PLC

1,372,600

5,340,484

WPP PLC

585,000

3,890,134

Xstrata PLC

497,900

5,384,077

TOTAL UNITED KINGDOM

356,202,050

United States of America - 3.0%

Aon Corp.

168,400

6,377,308

 

Shares

Value

Apple, Inc. (a)

17,100

$ 2,435,553

Calgon Carbon Corp. (a)

249,617

3,467,180

Estee Lauder Companies, Inc. Class A

378,500

12,365,595

Gilead Sciences, Inc. (a)

45,100

2,112,484

Google, Inc. Class A (sub. vtg.) (a)

21,600

9,106,344

Philip Morris International, Inc.

147,200

6,420,864

Sohu.com, Inc. (a)

64,100

4,027,403

TOTAL UNITED STATES OF AMERICA

46,312,731

TOTAL COMMON STOCKS

(Cost $1,633,787,267)

1,548,873,719

Money Market Funds - 3.1%

 

 

 

 

Fidelity Cash Central Fund, 0.40% (b)

4,620,338

4,620,338

Fidelity Securities Lending Cash Central Fund, 0.22% (b)(c)

42,639,986

42,639,986

TOTAL MONEY MARKET FUNDS

(Cost $47,260,324)

47,260,324

TOTAL INVESTMENT PORTFOLIO - 103.0%

(Cost $1,681,047,591)

1,596,134,043

NET OTHER ASSETS - (3.0)%

(45,852,725)

NET ASSETS - 100%

$ 1,550,281,318

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 unaudited listing of the fund's holdings as of its most recent quarter end is available upon request.

(c) Investment made with cash collateral received from securities on loan.

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

Affiliated Central Funds

Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:

Fund

Income earned

Fidelity Cash Central Fund

$ 34,977

Fidelity Securities Lending Cash Central Fund

1,401,687

Total

$ 1,436,664

Other Information

The following is a summary of the inputs used, as of June 30, 2009, involving the Fund's assets and liabilities carried at value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the tables below, please refer to the Security Valuation section in the accompanying Notes to Financial Statements.

Valuation Inputs at Reporting Date:

Description

Total

Level 1

Level 2

Level 3

Investments in Securities:

Equities:

United Kingdom

$ 356,202,050

$ 257,793,443

$ 98,408,607

$ -

Japan

272,100,282

186,521,627

85,578,655

-

France

175,071,181

156,130,618

18,940,563

-

Germany

154,293,214

118,262,061

36,031,153

-

Switzerland

110,744,779

97,645,859

13,098,920

-

Hong Kong

52,414,244

52,414,244

-

-

Australia

51,267,982

40,387,843

10,880,139

-

Spain

49,938,554

16,841,514

33,097,040

-

United States of America

46,312,731

46,312,731

-

-

Other

280,528,702

259,841,782

20,686,920

-

Money Market Funds

47,260,324

47,260,324

-

-

Total Investments in Securities:

$ 1,596,134,043

$ 1,279,412,046

$ 316,722,997

$ -

 

The following is a reconciliation of assets or liabilities for which level 3 inputs were used in determining value:

Investments in Securities:

 

Beginning Balance

$ 37,656,594

Total Realized Gain/Loss

(17,900,926)

Total Unrealized Gain Loss

7,521,996

Cost of purchases

12,372,825

Proceeds of sales

(17,227,962)

Amortization/Accretion

-

Transfers in/out of level 3:

(22,422,527)

Ending Balance

$ -

Net change in unrealized appreciation/depreciation on investments held at June 30, 2009

$ -

The information used in the above reconciliation represents fiscal year to date activity for any Investment Security identified as using Level 3 inputs at either the beginning or the end of the current fiscal period. Transfers in or out of Level 3 represents either the beginning value (for transfer in), or the ending value (for transfer out) of any security or Instrument where a change in the pricing level occurred from the beginning to the end of the period.

Income Tax Information

At December 31, 2008, the fund had a capital loss carryforward of approximately $243,257,460 all of which will expire on December 31, 2016.

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

Semiannual Report

Financial Statements

Statement of Assets and Liabilities

 

June 30, 2009 (Unaudited)

Assets

Investment in securities, at value (including securities loaned of $40,681,797) - See accompanying schedule:

Unaffiliated issuers (cost $1,633,787,267)

$ 1,548,873,719

 

Fidelity Central Funds (cost $47,260,324)

47,260,324

 

Total Investments (cost $1,681,047,591)

 

$ 1,596,134,043

Foreign currency held at value (cost $45)

45

Receivable for investments sold

6,265,505

Receivable for fund shares sold

410,953

Dividends receivable

5,414,678

Distributions receivable from Fidelity Central Funds

119,460

Prepaid expenses

9,906

Other affiliated receivables

708

Other receivables

1,660,190

Total assets

1,610,015,488

 

 

 

Liabilities

Payable to custodian bank

$ 100,318

Payable for investments purchased

9,300,621

Payable for fund shares redeemed

5,691,080

Accrued management fee

948,967

Distribution fees payable

113,885

Other affiliated payables

156,171

Other payables and accrued expenses

783,142

Collateral on securities loaned, at value

42,639,986

Total liabilities

59,734,170

 

 

 

Net Assets

$ 1,550,281,318

Net Assets consist of:

 

Paid in capital

$ 2,173,816,240

Undistributed net investment income

25,333,074

Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions

(563,961,431)

Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies

(84,906,565)

Net Assets

$ 1,550,281,318

Statement of Assets and Liabilities - continued

 

June 30, 2009 (Unaudited)

Initial Class:
Net Asset Value, offering price and redemption price per share ($657,219,527 ÷ 52,435,914 shares)

$ 12.53

 

 

 

Service Class:
Net Asset Value, offering price and redemption price per share ($154,416,938 ÷ 12,375,036 shares)

$ 12.48

 

 

 

Service Class 2:
Net Asset Value, offering price and redemption price per share ($397,270,390 ÷ 31,997,241 shares)

$ 12.42

 

 

 

Initial Class R:
Net Asset Value, offering price and redemption price per share ($111,463,985 ÷ 8,913,201 shares)

$ 12.51

 

 

 

Service Class R:
Net Asset Value, offering price and redemption price per share ($57,643,492 ÷ 4,626,613 shares)

$ 12.46

 

 

 

Service Class 2R:
Net Asset Value, offering price and redemption price per share ($51,472,368 ÷ 4,177,806 shares)

$ 12.32

 

 

 

Investor Class R:
Net Asset Value, offering price and redemption price per share ($120,794,618 ÷ 9,663,347 shares)

$ 12.50

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

Semiannual Report

Statement of Operations

Six months ended June 30, 2009 (Unaudited)

Investment Income

 

 

Dividends

 

$ 33,929,777

Interest

 

3,332

Income from Fidelity Central Funds

 

1,436,664

 

 

35,369,773

Less foreign taxes withheld

 

(3,167,827)

Total income

 

32,201,946

 

 

 

Expenses

Management fee

$ 5,172,864

Transfer agent fees

697,410

Distribution fees

614,476

Accounting and security lending fees

334,691

Custodian fees and expenses

119,056

Independent trustees' compensation

5,856

Appreciation in deferred trustee compensation account

46

Audit

35,488

Legal

22,337

Interest

2,430

Miscellaneous

67,382

Total expenses before reductions

7,072,036

Expense reductions

(168,219)

6,903,817

Net investment income (loss)

25,298,129

Realized and Unrealized Gain (Loss)

Net realized gain (loss) on:

Investment securities:

 

 

Unaffiliated issuers

(302,535,026)

Foreign currency transactions

(624,825)

Total net realized gain (loss)

 

(303,159,851)

Change in net unrealized appreciation (depreciation) on:

Investment securities

312,760,185

Assets and liabilities in foreign currencies

66,250

Total change in net unrealized appreciation (depreciation)

 

312,826,435

Net gain (loss)

9,666,584

Net increase (decrease) in net assets resulting from operations

$ 34,964,713

Statement of Changes in Net Assets

 

Six months ended
June 30, 2009
(Unaudited)

Year ended
December 31,
2008

Increase (Decrease) in Net Assets

 

 

Operations

 

 

Net investment income (loss)

$ 25,298,129

$ 62,527,697

Net realized gain (loss)

(303,159,851)

(249,321,918)

Change in net unrealized appreciation (depreciation)

312,826,435

(1,217,207,504)

Net increase (decrease) in net assets resulting from operations

34,964,713

(1,404,001,725)

Distributions to shareholders from net investment income

-

(61,798,099)

Distributions to shareholders from net realized gain

(2,239,250)

(348,490,470)

Total distributions

(2,239,250)

(410,288,569)

Share transactions - net increase (decrease)

(116,921,368)

(178,683,659)

Redemption fees

13,159

67,067

Total increase (decrease) in net assets

(84,182,746)

(1,992,906,886)

 

 

 

Net Assets

Beginning of period

1,634,464,064

3,627,370,950

End of period (including undistributed net investment income of $25,333,074 and undistributed net investment income of $34,945, respectively)

$ 1,550,281,318

$ 1,634,464,064

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

Semiannual Report

Financial Highlights - Initial Class

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 12.17

$ 25.33

$ 23.96

$ 20.60

$ 17.51

$ 15.59

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .20

.46

.45

.38

.20

.13

Net realized and unrealized gain (loss)

  .18

(10.67)

3.42

3.30

3.10

1.97

Total from investment operations

  .38

(10.21)

3.87

3.68

3.30

2.10

Distributions from net investment income

  -

(.49)

(.84)

(.19)

(.12)

(.18)

Distributions from net realized gain

  (.02)

(2.46)

(1.66)

(.13)

(.09)

-

Total distributions

  (.02)

(2.95)

(2.50)

(.32)

(.21)

(.18)

Redemption fees added to paid in capital E, I

  -

-

-

-

-

-

Net asset value, end of period

$ 12.53

$ 12.17

$ 25.33

$ 23.96

$ 20.60

$ 17.51

Total Return B, C, D

  3.12%

(43.83)%

17.41%

18.09%

19.06%

13.57%

Ratios to Average Net Assets F, H

 

 

 

 

 

 

Expenses before reductions

  .89% A

.87%

.85%

.88%

.89%

.91%

Expenses net of fee waivers, if any

  .89% A

.87%

.85%

.88%

.89%

.91%

Expenses net of all reductions

  .86% A

.84%

.82%

.81%

.82%

.87%

Net investment income (loss)

  3.59% A

2.45%

1.85%

1.76%

1.11%

.80%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 657,220

$ 703,357

$ 1,702,235

$ 1,624,901

$ 1,549,179

$ 1,491,485

Portfolio turnover rate G

  98% A

77%

62%

123%

92%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. 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. Expenses net of fee 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. I Amount represents less than $.01 per share.

Financial Highlights - Service Class

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 12.12

$ 25.23

$ 23.86

$ 20.52

$ 17.44

$ 15.53

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .20

.44

.43

.36

.18

.11

Net realized and unrealized gain (loss)

  .18

(10.61)

3.39

3.28

3.09

1.97

Total from investment operations

  .38

(10.17)

3.82

3.64

3.27

2.08

Distributions from net investment income

  -

(.48)

(.79)

(.17)

(.10)

(.17)

Distributions from net realized gain

  (.02)

(2.46)

(1.66)

(.13)

(.09)

-

Total distributions

  (.02)

(2.94)

(2.45)

(.30)

(.19)

(.17)

Redemption fees added to paid in capital E, I

  -

-

-

-

-

-

Net asset value, end of period

$ 12.48

$ 12.12

$ 25.23

$ 23.86

$ 20.52

$ 17.44

Total Return B, C, D

  3.14%

(43.89)%

17.25%

17.95%

18.97%

13.49%

Ratios to Average Net Assets F, H

 

 

 

 

 

 

Expenses before reductions

  .99% A

.97%

.95%

.98%

.99%

1.01%

Expenses net of fee waivers, if any

  .99% A

.97%

.95%

.98%

.99%

1.01%

Expenses net of all reductions

  .96% A

.94%

.92%

.91%

.92%

.97%

Net investment income (loss)

  3.49% A

2.35%

1.75%

1.66%

1.02%

.69%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 154,417

$ 165,608

$ 366,777

$ 362,060

$ 329,759

$ 322,649

Portfolio turnover rate G

  98% A

77%

62%

123%

92%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. 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. Expenses net of fee 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. I Amount represents less than $.01 per share.

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

Semiannual Report

Financial Highlights - Service Class 2

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 12.07

$ 25.12

$ 23.75

$ 20.43

$ 17.39

$ 15.50

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .19

.40

.39

.33

.14

.08

Net realized and unrealized gain (loss)

  .18

(10.54)

3.37

3.27

3.08

1.97

Total from investment operations

  .37

(10.14)

3.76

3.60

3.22

2.05

Distributions from net investment income

  -

(.45)

(.73)

(.15)

(.09)

(.16)

Distributions from net realized gain

  (.02)

(2.46)

(1.66)

(.13)

(.09)

-

Total distributions

  (.02)

(2.91)

(2.39)

(.28)

(.18)

(.16)

Redemption fees added to paid in capital E, I

  -

-

-

-

-

-

Net asset value, end of period

$ 12.42

$ 12.07

$ 25.12

$ 23.75

$ 20.43

$ 17.39

Total Return B, C, D

  3.07%

(43.96)%

17.05%

17.83%

18.72%

13.31%

Ratios to Average Net Assets F, H

 

 

 

 

 

 

Expenses before reductions

  1.13% A

1.12%

1.10%

1.13%

1.14%

1.16%

Expenses net of fee waivers, if any

  1.13% A

1.12%

1.10%

1.13%

1.14%

1.16%

Expenses net of all reductions

  1.11% A

1.09%

1.07%

1.06%

1.07%

1.12%

Net investment income (loss)

  3.34% A

2.21%

1.60%

1.51%

.79%

.54%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 397,270

$ 414,492

$ 821,943

$ 703,421

$ 502,801

$ 319,708

Portfolio turnover rate G

  98% A

77%

62%

123%

92%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. 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. Expenses net of fee 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. I Amount represents less than $.01 per share.

Financial Highlights - Initial Class R

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 12.14

$ 25.28

$ 23.92

$ 20.57

$ 17.49

$ 15.57

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .20

.46

.45

.38

.19

.12

Net realized and unrealized gain (loss)

  .19

(10.65)

3.41

3.29

3.10

1.98

Total from investment operations

  .39

(10.19)

3.86

3.67

3.29

2.10

Distributions from net investment income

  -

(.49)

(.84)

(.19)

(.12)

(.18)

Distributions from net realized gain

  (.02)

(2.46)

(1.66)

(.13)

(.09)

-

Total distributions

  (.02)

(2.95)

(2.50)

(.32)

(.21)

(.18)

Redemption fees added to paid in capital E, I

  -

-

-

-

-

-

Net asset value, end of period

$ 12.51

$ 12.14

$ 25.28

$ 23.92

$ 20.57

$ 17.49

Total Return B, C, D

  3.21%

(43.84)%

17.40%

18.08%

19.05%

13.59%

Ratios to Average Net Assets F, H

 

 

 

 

 

 

Expenses before reductions

  .89% A

.87%

.85%

.88%

.89%

.91%

Expenses net of fee waivers, if any

  .89% A

.87%

.85%

.88%

.89%

.91%

Expenses net of all reductions

  .86% A

.84%

.82%

.81%

.82%

.87%

Net investment income (loss)

  3.59% A

2.46%

1.85%

1.76%

1.08%

.79%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 111,464

$ 118,749

$ 275,678

$ 240,693

$ 184,245

$ 132,064

Portfolio turnover rate G

  98% A

77%

62%

123%

92%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. 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. Expenses net of fee 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. I Amount represents less than $.01 per share.

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

Semiannual Report

Financial Highlights - Service Class R

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 12.10

$ 25.19

$ 23.83

$ 20.50

$ 17.43

$ 15.52

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .20

.43

.43

.36

.17

.11

Net realized and unrealized gain (loss)

  .18

(10.58)

3.38

3.27

3.09

1.97

Total from investment operations

  .38

(10.15)

3.81

3.63

3.26

2.08

Distributions from net investment income

  -

(.48)

(.79)

(.17)

(.10)

(.17)

Distributions from net realized gain

  (.02)

(2.46)

(1.66)

(.13)

(.09)

-

Total distributions

  (.02)

(2.94)

(2.45)

(.30)

(.19)

(.17)

Redemption fees added to paid in capital E, I

  -

-

-

-

-

-

Net asset value, end of period

$ 12.46

$ 12.10

$ 25.19

$ 23.83

$ 20.50

$ 17.43

Total Return B, C, D

  3.14%

(43.88)%

17.23%

17.95%

18.92%

13.50%

Ratios to Average Net Assets F, H

 

 

 

 

 

 

Expenses before reductions

  .98% A

.96%

.94%

.98%

.99%

1.01%

Expenses net of fee waivers, if any

  .98% A

.96%

.94%

.98%

.99%

1.01%

Expenses net of all reductions

  .96% A

.94%

.92%

.91%

.92%

.96%

Net investment income (loss)

  3.50% A

2.36%

1.75%

1.66%

.96%

.70%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 57,643

$ 61,825

$ 135,038

$ 133,934

$ 115,449

$ 86,509

Portfolio turnover rate G

  98% A

77%

62%

123%

92%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. 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. Expenses net of fee 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. I Amount represents less than $.01 per share.

Financial Highlights - Service Class 2R

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 11.98

$ 24.95

$ 23.61

$ 20.32

$ 17.30

$ 15.42

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .19

.40

.39

.32

.14

.08

Net realized and unrealized gain (loss)

  .17

(10.46)

3.35

3.26

3.07

1.96

Total from investment operations

  .36

(10.06)

3.74

3.58

3.21

2.04

Distributions from net investment income

  -

(.45)

(.74)

(.16)

(.10)

(.16)

Distributions from net realized gain

  (.02)

(2.46)

(1.66)

(.13)

(.09)

-

Total distributions

  (.02)

(2.91)

(2.40)

(.29)

(.19)

(.16)

Redemption fees added to paid in capital E, I

  -

-

-

-

-

-

Net asset value, end of period

$ 12.32

$ 11.98

$ 24.95

$ 23.61

$ 20.32

$ 17.30

Total Return B, C, D

  3.00%

(43.94)%

17.06%

17.81%

18.74%

13.32%

Ratios to Average Net Assets F, H

 

 

 

 

 

 

Expenses before reductions

  1.13% A

1.11%

1.09%

1.13%

1.14%

1.16%

Expenses net of fee waivers, if any

  1.13% A

1.11%

1.09%

1.13%

1.14%

1.16%

Expenses net of all reductions

  1.11% A

1.09%

1.07%

1.06%

1.07%

1.11%

Net investment income (loss)

  3.35% A

2.21%

1.60%

1.51%

.77%

.55%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 51,472

$ 46,323

$ 95,871

$ 68,729

$ 49,373

$ 27,562

Portfolio turnover rate G

  98% A

77%

62%

123%

92%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. 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. Expenses net of fee 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. I Amount represents less than $.01 per share.

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

Semiannual Report

Financial Highlights - Investor Class R

 

Six months ended
June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005 H

Selected Per-Share Data

 

 

 

 

 

Net asset value, beginning of period

$ 12.14

$ 25.27

$ 23.91

$ 20.59

$ 17.69

Income from Investment Operations

 

 

 

 

 

Net investment income (loss) E

  .20

.43

.42

.36

.02

Net realized and unrealized gain (loss)

  .18

(10.62)

3.41

3.29

2.88

Total from investment operations

  .38

(10.19)

3.83

3.65

2.90

Distributions from net investment income

  -

(.48)

(.81)

(.20)

-

Distributions from net realized gain

  (.02)

(2.46)

(1.66)

(.13)

-

Total distributions

  (.02)

(2.94)

(2.47)

(.33)

-

Redemption fees added to paid in capital E, J

  -

-

-

-

-

Net asset value, end of period

$ 12.50

$ 12.14

$ 25.27

$ 23.91

$ 20.59

Total Return B, C, D

  3.13%

(43.89)%

17.25%

17.94%

16.39%

Ratios to Average Net Assets F, I

 

 

 

 

 

Expenses before reductions

  .99% A

.96%

.96%

1.01%

1.07% A

Expenses net of fee waivers, if any

  .99% A

.96%

.96%

1.01%

1.07% A

Expenses net of all reductions

  .97% A

.93%

.94%

.93%

1.00% A

Net investment income (loss)

  3.48% A

2.36%

1.74%

1.64%

.23% A

Supplemental Data

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 120,795

$ 124,111

$ 229,829

$ 122,018

$ 29,544

Portfolio turnover rate G

  98% A

77%

62%

123%

92%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H For the period July 21, 2005 (commencement of sale of shares) to December 31, 2005. I 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 fee 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. J Amount represents less than $.01 per share.

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

Semiannual Report

Notes to Financial Statements

For the period ended June 30, 2009 (Unaudited)

1. Organization.

VIP Overseas Portfolio (the Fund) is a fund of Variable Insurance Products Fund (the trust) and is authorized to issue an unlimited number of shares. The trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. Shares of the Fund may only be purchased by insurance companies for the purpose of funding variable annuity or variable life insurance contracts. The Fund offers the following classes of shares: Initial Class shares, Service Class shares, Service Class 2 shares, Initial Class R shares, Service Class R shares, Service Class 2R shares, and Investor Class R 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 transfer agent and distribution and service plan fees incurred. Certain expense reductions also differ by class.

2. Investments in Fidelity Central Funds.

The Fund may invest in Fidelity Central Funds, which are open-end investment companies available only to other investment companies and accounts managed by Fidelity Management & Research Company (FMR) and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.

The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of FMR.

A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the SEC's web site at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC's web site or upon request.

3. Significant Accounting Policies.

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. Actual results could differ from those estimates. Events or transactions occurring after period end through the date that the financial statements were issued, August 13, 2009, have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:

Security Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Fund uses independent pricing services approved by the Board of Trustees to value its investments. Generally Accepted Accounting Principles (GAAP) establishes a disclosure hierarchy that categorizes the inputs to valuation techniques used to value assets and liabilities at measurement date. These inputs are classified into three levels. Level 1 includes readily available unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 includes observable inputs other than quoted prices included in Level 1 that are observable either directly or indirectly. Level 3 includes unobservable inputs when market prices are not readily available or reliable. Changes in valuation techniques may result in transfers in or out of an investment's assigned level within the hierarchy. The aggregate value by input level, as of June 30, 2009, for the Fund's investments, as well as a reconciliation of assets and liabilities for which significant unobservable inputs (Level 3) were used in determining value, is included at the end of the Fund's Schedule of Investments. Valuation techniques of the Fund's major categories of assets and liabilities as presented in the Schedule of Investments are as follows.

Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by an independent pricing service on the primary market or exchange on which they are traded. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price. Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value each business day. Short-term securities with remaining maturities of sixty days or less for which quotations are not readily available are valued at amortized cost, which approximates value.

When current market prices or quotations are not readily available or reliable, valuations may be determined in good faith in accordance with procedures adopted by the Board of Trustees. Factors used in determining value may include significant market or security specific events, changes in interest rates and credit quality, and developments in foreign markets which are monitored by evaluating the performance of ADRs, futures contracts and exchange-traded funds. The frequency with which these procedures are used cannot be predicted and may be utilized to a significant extent. The value of securities used for net asset value (NAV) calculation under these procedures may differ from published prices for the same securities.

Foreign Currency. The Fund uses 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.

Semiannual Report

Notes to Financial Statements (Unaudited) - continued

3. Significant Accounting Policies - continued

Foreign Currency - continued

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. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. 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 Fund is 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. Interest income and distributions from the Fidelity Central Funds are accrued as earned. Interest income includes coupon interest and amortization of premium and accretion of discount on debt securities. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.

Expenses. Most expenses of the trust can be directly attributed to a fund. Expenses which cannot be directly attributed are apportioned among each Fund in the trust. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.

Deferred Trustee Compensation. Under a Deferred Compensation Plan (the Plan), independent 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 invested in a cross-section of Fidelity funds, are marked-to-market and remain in the Fund until distributed in accordance with the Plan. The investment of deferred amounts and the offsetting payable to the Trustees are included in the accompanying Statement of Assets and Liabilities.

Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company by distributing substantially all of its taxable income and realized gains under Subchapter M of the Internal Revenue Code and filing its U.S. federal tax return. As a result, no provision for income taxes is required. The Fund is subject to the provisions of FASB Interpretation No. 48, Accounting for Uncertainties in Income Taxes (FIN 48). FIN 48 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. There are no unrecognized tax benefits in the accompanying financial statements. A Fund's federal tax return is subject to examination by the Internal Revenue Service (IRS) for a period of three years. Foreign taxes are provided for based on the 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 foreign currency transactions, certain foreign taxes, passive foreign investment companies (PFIC), deferred trustees compensation, capital loss carryforwards and losses deferred due to wash sales.

The federal tax cost of investments and unrealized appreciation (depreciation) as of period end were as follows:

Unrealized appreciation

$ 186,033,822

Unrealized depreciation

(294,587,953)

Net unrealized appreciation (depreciation)

$ (108,554,131)

Cost for federal income tax purposes

$ 1,704,688,174

Trading (Redemption) Fees. Initial Class R shares, Service Class R shares, Service Class 2R shares and Investor Class R 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 Fund and accounted for as an addition to paid in capital.

4. Purchases and Sales of Investments.

Purchases and sales of securities, other than short-term securities, aggregated $710,486,739 and $771,257,458, respectively.

Semiannual Report

5. Fees and Other Transactions with Affiliates.

Management Fee. FMR and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .45% of the Fund's average net assets and a group fee rate that averaged .27% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by FMR. The group fee rate decreases as assets under management increase and increases as assets under management decrease. For the period, the total annualized management fee rate was .72% of the Fund's average net assets.

Distribution and Service Plan. In accordance with Rule 12b-1 of the 1940 Act, the Fund has 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's 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

$ 72,367

Service Class 2

459,544

Service Class R

26,939

Service Class 2R

55,626

 

$ 614,476

Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc. (FIIOC), an affiliate of FMR, is the Fund's transfer, dividend disbursing, and shareholder servicing agent. FIIOC receives an asset-based fee with respect to each class. Each class (with the exception of Investor Class R) pays a transfer agent fee, excluding out of pocket expenses, equal to an annual rate of .07% of average net assets. Investor Class R pays a monthly asset-based transfer agent fee of .15% of average net assets. The total transfer agent fees paid by each class to FIIOC, including out of pocket expenses, were as follows:

Initial Class

$ 277,703

Service Class

63,997

Service Class 2

160,374

Initial Class R

45,470

Service Class R

22,867

Service Class 2R

18,679

Investor Class R

108,320

 

$ 697,410

Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of FMR, maintains the 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.

Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. The commissions paid to these affiliated firms were $958 for the period.

Interfund Lending Program. Pursuant to an Exemptive Order issued by the Securities and Exchange Commission (the SEC), the Fund, 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 affiliated funds. At period end, there were no interfund loans outstanding. The Fund's activity in this program during the period for which loans were outstanding was as follows:

Borrower or Lender

Average Daily
Loan Balance

WeightedAverage
Interest Rate

Interest
Expense

Borrower

$ 5,975,625

.48%

$ 1,918

6. Committed Line of Credit.

The Fund participates with other funds managed by FMR in a $3.5 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 Fund has agreed to pay commitment fees on its pro-rata portion of the line of credit, which amounted to $4,685 and is reflected in Miscellaneous Expense on the Statement of Operations. During the period, there were no borrowings on this line of credit.

Semiannual Report

Notes to Financial Statements (Unaudited) - continued

7. Security Lending.

The Fund lends portfolio securities from time to time in order to earn additional income. On the settlement date of the loan, the 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 Fund and any additional required collateral is delivered to the Fund 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. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. Security lending income represents the income earned on investing cash collateral, less fees and expenses associated with the loan, plus any premium payments that may be received on the loan of certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds. Net income from lending portfolio securities during the period amounted to $1,401,687.

8. Bank Borrowings.

The Fund is permitted to have bank borrowings for temporary or emergency purposes to fund shareholder redemptions. The 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. The average daily loan balance during the period for which loans were outstanding amounted to $11,933,500. The weighted average interest rate was .77%. The interest expense amounted to $512 under the bank borrowing program. At period end, there were no bank borrowings outstanding.

9. Expense Reductions.

Many of the brokers with whom FMR places trades on behalf of the Fund provided services to the Fund in addition to trade execution. These services included payments of certain expenses on behalf of the Fund totaling $168,170 for the period. In addition, through arrangements with the Fund's custodian, credits realized as a result of uninvested cash balances were used to reduce the Fund's expenses. During the period, these credits reduced the Fund's custody expenses by $49.

10. Distributions to Shareholders.

Distributions to shareholders of each class were as follows:

 

Six months ended
June 30,
2009

Year ended
December 31,
2008

From net investment income

 

 

Initial Class

$ -

$ 27,449,630

Service Class

-

6,285,159

Service Class 2

-

14,726,472

Initial Class R

-

4,651,583

Service Class R

-

2,342,494

Service Class 2R

-

1,653,621

Investor Class R

-

4,689,140

Total

$ -

$ 61,798,099

 

From net realized gain

 

 

Initial Class

$ 961,601

$ 163,022,999

Service Class

226,832

34,891,161

Service Class 2

568,192

79,417,694

Initial Class R

160,788

26,045,726

Service Class R

84,356

12,931,868

Service Class 2R

65,956

9,495,528

Investor Class R

171,525

22,685,494

Total

$ 2,239,250

$ 348,490,470

Semiannual Report

11. Share Transactions.

Transactions for each class of shares were as follows:

 

Shares

Dollars

Six months ended
June 30,
2009

Year ended
December 31,
2008

Six months ended
June 30,
2009

Year ended
December 31,
2008

Initial Class

 

 

 

 

Shares sold

2,985,818

5,742,422

$ 34,885,861

$ 105,330,600

Reinvestment of distributions

90,291

10,416,592

961,601

190,472,629

Shares redeemed

(8,447,579)

(25,565,528)

(96,308,449)

(491,629,057)

Net increase (decrease)

(5,371,470)

(9,406,514)

$ (60,460,987)

$ (195,825,828)

Service Class

 

 

 

 

Shares sold

452,151

1,370,007

$ 5,057,359

$ 23,974,828

Reinvestment of distributions

21,379

2,274,580

226,832

41,176,320

Shares redeemed

(1,763,267)

(4,518,541)

(19,218,830)

(82,046,840)

Net increase (decrease)

(1,289,737)

(873,954)

$ (13,934,639)

$ (16,895,692)

Service Class 2

 

 

 

 

Shares sold

1,898,110

5,449,407

$ 20,660,039

$ 97,500,340

Reinvestment of distributions

53,806

5,238,634

568,192

94,144,166

Shares redeemed

(4,301,489)

(9,062,599)

(47,308,634)

(161,377,161)

Net increase (decrease)

(2,349,573)

1,625,442

$ (26,080,403)

$ 30,267,345

Initial Class R

 

 

 

 

Shares sold

316,104

600,161

$ 3,474,061

$ 11,570,605

Reinvestment of distributions

15,126

1,690,588

160,788

30,697,309

Shares redeemed

(1,199,814)

(3,415,687)

(12,897,002)

(60,745,148)

Net increase (decrease)

(868,584)

(1,124,938)

$ (9,262,153)

$ (18,477,234)

Service Class R

 

 

 

 

Shares sold

176,134

517,294

$ 2,001,305

$ 9,780,288

Reinvestment of distributions

7,966

845,462

84,356

15,274,362

Shares redeemed

(666,736)

(1,613,463)

(7,236,144)

(28,583,442)

Net increase (decrease)

(482,636)

(250,707)

$ (5,150,483)

$ (3,528,792)

Service Class 2R

 

 

 

 

Shares sold

645,276

716,923

$ 7,000,163

$ 13,560,422

Reinvestment of distributions

6,293

621,801

65,956

11,149,149

Shares redeemed

(341,987)

(1,313,080)

(3,676,530)

(23,348,326)

Net increase (decrease)

309,582

25,644

$ 3,389,589

$ 1,361,245

Investor Class R

 

 

 

 

Shares sold

421,348

1,767,383

$ 4,883,936

$ 32,933,570

Reinvestment of distributions

16,136

1,527,774

171,525

27,374,634

Shares redeemed

(996,216)

(2,169,278)

(10,477,753)

(35,892,907)

Net increase (decrease)

(558,732)

1,125,879

$ (5,422,292)

$ 24,415,297

12. Other.

The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund's maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

At the end of the period, FMR or its affiliates were the owners of record of 16% of the total outstanding shares of the Fund and two otherwise unaffiliated shareholders were the owners of record of 36% of the total outstanding shares of the Fund.

Semiannual Report

Investment Adviser

Fidelity Management & Research Company
Boston, MA

Investment Sub-Advisers

FMR Co., Inc.

Fidelity Management & Research (U.K.) Inc.

Fidelity Research & Analysis Company

FIL Investment Advisors

FIL Investment Advisors (U.K.) Ltd.

Fidelity Investments Japan Limited

Fidelity Management & Research (Japan) Inc.

Fidelity Management & Research (Hong Kong) Limited

General Distributor

Fidelity Distributors Corporation
Boston, MA

Transfer and Service Agents

Fidelity Investments Institutional Operations Company, Inc.
Boston, MA 

Fidelity Service Company, Inc.
Boston, MA 

Custodian

JPMorgan Chase Bank
New York, NY 

VIPOVRSR-SANN-0809
1.774855.107

Fidelity® Variable Insurance Products:
Value Portfolio

Semiannual Report

June 30, 2009

(2_fidelity_logos) (Registered_Trademark)

Contents

Shareholder Expense Example

<Click Here>

An example of shareholder expenses.

Investment Changes

<Click Here>

A summary of major shifts in the fund's investments over the past six months.

Investments

<Click Here>

A complete list of the fund's investments with their market values.

Financial Statements

<Click Here>

Statements of assets and liabilities, operations, and changes in net assets, as well as financial highlights.

Notes

<Click Here>

Notes to the financial statements.

 

 

 

To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov. You may also call 1-877-208-0098 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 LLC or an affiliated company.

This report and the financial statements contained herein are submitted for the general information of the shareholders of the fund. This report is not authorized for distribution to prospective investors in the fund 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 holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com or http://www.advisor.fidelity.com, as applicable.

NOT FDIC INSURED · MAY LOSE VALUE · NO BANK GUARANTEE

Neither the fund nor Fidelity Distributors Corporation is a bank.

Semiannual Report

Shareholder Expense Example

As a shareholder of the 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 Fund 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 (January 1, 2009 to June 30, 2009).

Actual Expenses

The first line of the accompanying table for each class of the 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. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.

Hypothetical Example for Comparison Purposes

The second line of the accompanying table for each class of the 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. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.

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.

 

Annualized
Expense Ratio

Beginning
Account Value
January 1, 2009

Ending
Account Value
June 30, 2009

Expenses Paid
During Period*
January 1, 2009 to June 30, 2009

Initial Class

.83%

 

 

 

Actual

 

$ 1,000.00

$ 1,078.10

$ 4.28

Hypothetical A

 

$ 1,000.00

$ 1,020.68

$ 4.16

Service Class

.94%

 

 

 

Actual

 

$ 1,000.00

$ 1,076.60

$ 4.84

Hypothetical A

 

$ 1,000.00

$ 1,020.13

$ 4.71

Service Class 2

1.08%

 

 

 

Actual

 

$ 1,000.00

$ 1,077.30

$ 5.56

Hypothetical A

 

$ 1,000.00

$ 1,019.44

$ 5.41

Investor Class

.92%

 

 

 

Actual

 

$ 1,000.00

$ 1,078.10

$ 4.74

Hypothetical A

 

$ 1,000.00

$ 1,020.23

$ 4.61

A 5% return per year before expenses

* Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).

Semiannual Report

Investment Changes (Unaudited)

Top Ten Stocks as of June 30, 2009

 

% of fund's
net assets

% of fund's net assets
6 months ago

Avnet, Inc.

1.4

1.2

JPMorgan Chase & Co.

1.3

1.1

Arrow Electronics, Inc.

1.2

1.1

PNC Financial Services Group, Inc.

1.2

0.5

Wells Fargo & Co.

1.1

0.0

The Stanley Works

1.1

1.1

National Semiconductor Corp.

1.1

0.9

The Goodyear Tire & Rubber Co.

1.1

0.4

Avon Products, Inc.

1.0

0.8

Agilent Technologies, Inc.

1.0

0.8

 

11.5

 

Top Five Market Sectors as of June 30, 2009

 

% of fund's
net assets

% of fund's net assets
6 months ago

Financials

21.5

19.8

Information Technology

16.8

16.1

Consumer Discretionary

15.8

21.6

Industrials

13.1

13.2

Energy

8.2

6.5

Asset Allocation (% of fund's net assets)

As of June 30, 2009 *

As of December 31, 2008 **

fid4705

Stocks 98.0%

 

fid4705

Stocks 98.3%

 

fid4827

Bonds 1.0%

 

fid4708

Bonds 0.2%

 

fid4711

Short-Term
Investments and
Net Other Assets 1.0%

 

fid4711

Short-Term
Investments and
Net Other Assets 1.5%

 

* Foreign investments

11.7%

 

** Foreign investments

9.4%

 


fid4832

Semiannual Report

Investments June 30, 2009 (Unaudited)

Showing Percentage of Net Assets

Common Stocks - 97.8%

Shares

Value

CONSUMER DISCRETIONARY - 15.2%

Auto Components - 2.0%

Autoliv, Inc.

3,200

$ 92,064

BorgWarner, Inc.

1,900

64,885

Gentex Corp.

11,640

135,024

Johnson Controls, Inc.

26,751

581,032

The Goodyear Tire & Rubber Co. (a)

91,000

1,024,660

 

1,897,665

Automobiles - 0.8%

Bayerische Motoren Werke AG (BMW)

1,547

58,242

Fiat SpA (a)

6,421

64,488

Harley-Davidson, Inc.

3,626

58,777

Renault SA (a)

5,100

187,214

Thor Industries, Inc.

5,033

92,456

Winnebago Industries, Inc.

37,964

282,073

 

743,250

Diversified Consumer Services - 0.2%

H&R Block, Inc.

3,100

53,413

Regis Corp.

5,700

99,237

 

152,650

Hotels, Restaurants & Leisure - 3.5%

Brinker International, Inc.

50,800

865,124

Burger King Holdings, Inc.

21,290

367,678

Carnival Corp. unit

24,100

621,057

Penn National Gaming, Inc. (a)

3,274

95,306

Starbucks Corp. (a)

5,500

76,395

Starwood Hotels & Resorts Worldwide, Inc.

13,300

295,260

Vail Resorts, Inc. (a)

6,300

168,966

WMS Industries, Inc. (a)

16,626

523,885

Wyndham Worldwide Corp.

32,296

391,428

 

3,405,099

Household Durables - 4.2%

Black & Decker Corp.

20,697

593,176

Centex Corp.

29,700

251,262

Ethan Allen Interiors, Inc.

38,105

394,768

Harman International Industries, Inc.

6,000

112,800

KB Home

7,300

99,864

La-Z-Boy, Inc.

16,000

75,520

Leggett & Platt, Inc.

50,100

763,023

Newell Rubbermaid, Inc.

1,731

18,020

The Stanley Works

30,700

1,038,888

Whirlpool Corp.

16,800

715,008

 

4,062,329

Leisure Equipment & Products - 0.4%

Brunswick Corp.

46,492

200,845

Eastman Kodak Co.

65,000

192,400

 

393,245

Media - 1.0%

Comcast Corp. Class A (special) (non-vtg.)

12,400

174,840

 

Shares

Value

Discovery Communications, Inc.
Class C (a)

14,318

$ 293,949

Interpublic Group of Companies, Inc. (a)

14,577

73,614

Lamar Advertising Co. Class A (a)(e)

6,883

105,103

Live Nation, Inc. (a)

16,200

78,732

Omnicom Group, Inc.

2,957

93,382

WPP PLC

14,119

93,889

 

913,509

Multiline Retail - 0.5%

Macy's, Inc.

22,620

266,011

Nordstrom, Inc. (e)

12,287

244,388

 

510,399

Specialty Retail - 2.3%

AnnTaylor Stores Corp. (a)

12,177

97,172

Asbury Automotive Group, Inc.

15,968

163,512

Best Buy Co., Inc.

2,200

73,678

Collective Brands, Inc. (a)

8,000

116,560

Gap, Inc.

6,321

103,664

Limited Brands, Inc.

8,000

95,760

OfficeMax, Inc.

61,025

383,237

PetSmart, Inc.

4,853

104,145

Sherwin-Williams Co.

3,310

177,913

Staples, Inc.

4,643

93,649

Williams-Sonoma, Inc. (e)

70,370

835,292

 

2,244,582

Textiles, Apparel & Luxury Goods - 0.3%

Liz Claiborne, Inc.

60,136

173,192

VF Corp.

1,700

94,095

 

267,287

TOTAL CONSUMER DISCRETIONARY

14,590,015

CONSUMER STAPLES - 5.1%

Beverages - 1.1%

Anheuser-Busch InBev NV

11,040

398,605

Carlsberg AS:

Series A

2,675

175,110

Series B

2,400

153,943

Coca-Cola Enterprises, Inc.

21,840

363,636

 

1,091,294

Food & Staples Retailing - 1.4%

Safeway, Inc.

5,200

105,924

SUPERVALU, Inc.

22,100

286,195

Sysco Corp.

34,100

766,568

Winn-Dixie Stores, Inc. (a)

12,487

156,587

 

1,315,274

Food Products - 1.3%

Cermaq ASA

11,100

88,442

ConAgra Foods, Inc.

1,500

28,590

Corn Products International, Inc.

7,488

200,604

Marine Harvest ASA (a)

536,000

359,989

Ralcorp Holdings, Inc. (a)

1,700

103,564

Common Stocks - continued

Shares

Value

CONSUMER STAPLES - continued

Food Products - continued

Smithfield Foods, Inc. (a)

9,700

$ 135,509

Tyson Foods, Inc. Class A

27,631

348,427

 

1,265,125

Household Products - 0.2%

Energizer Holdings, Inc. (a)

2,874

150,138

Personal Products - 1.0%

Avon Products, Inc.

38,300

987,374

Tobacco - 0.1%

Lorillard, Inc.

1,500

101,655

TOTAL CONSUMER STAPLES

4,910,860

ENERGY - 8.2%

Energy Equipment & Services - 3.2%

BJ Services Co.

27,040

368,555

ENSCO International, Inc.

3,600

125,532

Helmerich & Payne, Inc.

11,500

355,005

Nabors Industries Ltd. (a)

23,700

369,246

National Oilwell Varco, Inc. (a)

16,328

533,272

Patterson-UTI Energy, Inc.

36,400

468,104

Smith International, Inc.

11,300

290,975

Weatherford International Ltd. (a)

29,966

586,135

 

3,096,824

Oil, Gas & Consumable Fuels - 5.0%

Cabot Oil & Gas Corp.

13,700

419,768

Canadian Natural Resources Ltd.

7,200

378,788

Chesapeake Energy Corp.

9,500

188,385

EOG Resources, Inc.

8,400

570,528

EXCO Resources, Inc. (a)

22,500

290,700

Marathon Oil Corp.

19,172

577,652

Petrohawk Energy Corp. (a)

19,800

441,540

Plains Exploration & Production Co. (a)

3,800

103,968

Range Resources Corp.

8,800

364,408

Southwestern Energy Co. (a)

11,400

442,890

Suncor Energy, Inc.

16,600

504,808

Ultra Petroleum Corp. (a)

12,500

487,500

 

4,770,935

TOTAL ENERGY

7,867,759

FINANCIALS - 21.2%

Capital Markets - 1.8%

Ameriprise Financial, Inc.

7,148

173,482

Bank of New York Mellon Corp.

26,175

767,189

Morgan Stanley

10,660

303,917

T. Rowe Price Group, Inc.

1,559

64,964

TD Ameritrade Holding Corp. (a)

24,800

434,992

 

1,744,544

Commercial Banks - 6.1%

Associated Banc-Corp.

14,751

184,388

 

Shares

Value

Boston Private Financial Holdings, Inc.

11,063

$ 49,562

CapitalSource, Inc.

35,400

172,752

Comerica, Inc.

25,000

528,750

Fifth Third Bancorp

59,300

421,030

Huntington Bancshares, Inc.

98,647

412,344

KeyCorp

93,600

490,464

M&T Bank Corp.

2,200

112,046

Marshall & Ilsley Corp.

37,259

178,843

PNC Financial Services Group, Inc.

28,796

1,117,573

TCF Financial Corp. (e)

18,100

241,997

U.S. Bancorp, Delaware

28,700

514,304

Wells Fargo & Co.

45,595

1,106,135

Zions Bancorp (e)

32,904

380,370

 

5,910,558

Consumer Finance - 1.8%

American Express Co.

16,377

380,601

Capital One Financial Corp.

44,099

964,886

Discover Financial Services

35,639

366,013

 

1,711,500

Diversified Financial Services - 2.3%

Bank of America Corp.

71,510

943,932

Gimv NV

100

4,991

JPMorgan Chase & Co.

36,286

1,237,715

 

2,186,638

Insurance - 3.9%

Everest Re Group Ltd.

6,167

441,372

Lincoln National Corp.

32,268

555,332

Loews Corp.

20,786

569,536

Marsh & McLennan Companies, Inc.

38,400

772,992

MetLife, Inc.

5,400

162,054

PartnerRe Ltd.

6,600

428,670

Principal Financial Group, Inc.

3,500

65,940

Unum Group

17,320

274,695

Validus Holdings Ltd.

3,049

67,017

Willis Group Holdings Ltd.

14,800

380,804

XL Capital Ltd. Class A

6,000

68,760

Zenith National Insurance Corp.

100

2,174

 

3,789,346

Real Estate Investment Trusts - 4.1%

Alexandria Real Estate Equities, Inc.

7,800

279,162

Brandywine Realty Trust (SBI)

20,373

151,779

Camden Property Trust (SBI)

9,553

263,663

CBL & Associates Properties, Inc.

9,400

50,666

Digital Realty Trust, Inc.

8,708

312,182

Duke Realty LP

21,800

191,186

Highwoods Properties, Inc. (SBI)

15,070

337,116

Host Hotels & Resorts, Inc.

19,600

164,444

ProLogis Trust

51,491

415,017

Regency Centers Corp.

5,700

198,987

Simon Property Group, Inc.

3,700

190,291

SL Green Realty Corp.

7,300

167,462

The Macerich Co. (e)

21,340

375,797

Common Stocks - continued

Shares

Value

FINANCIALS - continued

Real Estate Investment Trusts - continued

Ventas, Inc.

6,800

$ 203,048

Vornado Realty Trust

14,578

656,447

 

3,957,247

Real Estate Management & Development - 0.8%

Brookfield Properties Corp.

23,500

187,295

CB Richard Ellis Group, Inc. Class A (a)

56,822

531,854

 

719,149

Thrifts & Mortgage Finance - 0.4%

New York Community Bancorp, Inc. (e)

38,300

409,427

TOTAL FINANCIALS

20,428,409

HEALTH CARE - 2.8%

Biotechnology - 0.1%

Dendreon Corp. (a)

2,300

57,155

Health Care Equipment & Supplies - 0.4%

Cooper Companies, Inc.

5,100

126,123

Covidien PLC

4,500

168,480

Orthofix International NV (a)

3,475

86,910

 

381,513

Health Care Providers & Services - 1.7%

Brookdale Senior Living, Inc.

16,647

162,142

Emeritus Corp. (a)

710

9,379

Henry Schein, Inc. (a)

9,998

479,404

McKesson Corp.

7,300

321,200

Universal Health Services, Inc. Class B

8,042

392,852

VCA Antech, Inc. (a)

8,831

235,788

 

1,600,765

Health Care Technology - 0.1%

IMS Health, Inc.

10,180

129,286

Pharmaceuticals - 0.5%

Cadence Pharmaceuticals, Inc. (a)

6,647

66,404

King Pharmaceuticals, Inc. (a)

32,800

315,864

Teva Pharmaceutical Industries Ltd. sponsored ADR

1,552

76,576

ViroPharma, Inc. (a)

9,000

53,370

 

512,214

TOTAL HEALTH CARE

2,680,933

INDUSTRIALS - 13.0%

Aerospace & Defense - 0.7%

Heico Corp. Class A

10,417

304,801

Precision Castparts Corp.

5,500

401,665

 

706,466

Air Freight & Logistics - 0.8%

United Parcel Service, Inc. Class B

14,600

729,854

 

Shares

Value

Airlines - 0.2%

Delta Air Lines, Inc. (a)

27,100

$ 156,909

Building Products - 1.0%

Masco Corp.

52,700

504,866

Owens Corning (a)

36,075

461,039

 

965,905

Commercial Services & Supplies - 2.3%

ACCO Brands Corp. (a)

38,721

109,193

Cintas Corp.

1,200

27,408

Clean Harbors, Inc. (a)

6,600

356,334

Consolidated Graphics, Inc. (a)

9,388

163,539

R.R. Donnelley & Sons Co.

49,217

571,902

Republic Services, Inc.

36,590

893,162

The Brink's Co.

4,300

124,829

 

2,246,367

Construction & Engineering - 0.4%

Dycom Industries, Inc. (a)

30,345

335,919

Electrical Equipment - 0.7%

Acuity Brands, Inc.

4,400

123,420

Cooper Industries Ltd. Class A

8,577

266,316

Regal-Beloit Corp.

3,100

123,132

Sunpower Corp. Class B (a)

7,274

174,212

 

687,080

Industrial Conglomerates - 0.2%

Carlisle Companies, Inc.

8,500

204,340

Machinery - 2.7%

Albany International Corp. Class A

17,365

197,614

Briggs & Stratton Corp.

10,389

138,589

Crane Co.

3,200

71,392

Cummins, Inc.

15,881

559,170

Deere & Co.

7,700

307,615

Eaton Corp.

7,400

330,114

Ingersoll-Rand Co. Ltd. Class A

9,900

206,910

Kennametal, Inc.

8,400

161,112

Navistar International Corp. (a)

7,400

322,640

Oshkosh Co.

2,000

29,080

Pentair, Inc.

11,423

292,657

 

2,616,893

Professional Services - 1.3%

Experian PLC

21,072

157,473

IHS, Inc. Class A (a)

5,750

286,753

Manpower, Inc.

10,408

440,675

Monster Worldwide, Inc. (a)

21,341

252,037

MPS Group, Inc. (a)

13,231

101,085

 

1,238,023

Road & Rail - 2.3%

Canadian National Railway Co.

8,600

369,480

Con-way, Inc.

23,450

828,020

CSX Corp.

5,900

204,317

Common Stocks - continued

Shares

Value

INDUSTRIALS - continued

Road & Rail - continued

Ryder System, Inc.

19,400

$ 541,648

Union Pacific Corp.

5,400

281,124

 

2,224,589

Trading Companies & Distributors - 0.3%

W.W. Grainger, Inc.

3,300

270,204

Transportation Infrastructure - 0.1%

Macquarie Infrastructure Co. LLC

22,561

92,726

TOTAL INDUSTRIALS

12,475,275

INFORMATION TECHNOLOGY - 16.8%

Communications Equipment - 0.5%

Motorola, Inc.

79,400

526,422

Computers & Peripherals - 1.2%

Gemalto NV (a)

4,170

144,243

NCR Corp. (a)

58,600

693,238

Seagate Technology

18,800

196,648

Western Digital Corp. (a)

4,500

119,250

 

1,153,379

Electronic Equipment & Components - 5.8%

Agilent Technologies, Inc. (a)

48,049

975,875

Arrow Electronics, Inc. (a)

57,053

1,211,806

Avnet, Inc. (a)

62,777

1,320,199

Corning, Inc.

25,900

415,954

Flextronics International Ltd. (a)

159,300

654,723

Itron, Inc. (a)

4,716

259,710

Tyco Electronics Ltd.

42,100

782,639

 

5,620,906

Internet Software & Services - 0.6%

eBay, Inc. (a)

3,959

67,818

VeriSign, Inc. (a)

19,438

359,214

Yahoo!, Inc. (a)

12,100

189,486

 

616,518

IT Services - 1.5%

Accenture Ltd. Class A

12,900

431,634

Lender Processing Services, Inc.

3,549

98,556

The Western Union Co.

36,500

598,600

Visa, Inc.

4,564

284,155

 

1,412,945

Office Electronics - 1.0%

Xerox Corp.

148,200

960,336

Semiconductors & Semiconductor Equipment - 5.3%

Applied Materials, Inc.

60,700

665,879

ASML Holding NV (NY Shares)

35,944

778,188

Fairchild Semiconductor International, Inc. (a)

121,400

848,586

International Rectifier Corp. (a)

2,700

39,987

KLA-Tencor Corp.

4,700

118,675

 

Shares

Value

Lam Research Corp. (a)

3,400

$ 88,400

Maxim Integrated Products, Inc.

27,400

429,906

Micron Technology, Inc. (a)

58,754

297,295

MKS Instruments, Inc. (a)

15,600

205,764

National Semiconductor Corp.

82,200

1,031,610

Standard Microsystems Corp. (a)

12,354

252,639

Varian Semiconductor Equipment Associates, Inc. (a)

14,151

339,482

 

5,096,411

Software - 0.9%

ANSYS, Inc. (a)

5,700

177,612

BMC Software, Inc. (a)

3,300

111,507

Electronic Arts, Inc. (a)

24,894

540,698

 

829,817

TOTAL INFORMATION TECHNOLOGY

16,216,734

MATERIALS - 7.6%

Chemicals - 2.7%

Albemarle Corp.

25,026

639,915

Arkema sponsored ADR

8,511

199,157

Ashland, Inc.

7,000

196,350

Calgon Carbon Corp. (a)

11,069

153,748

Celanese Corp. Class A

10,800

256,500

Cytec Industries, Inc.

5,040

93,845

FMC Corp.

8,148

385,400

H.B. Fuller Co.

18,752

351,975

Solutia, Inc. (a)

24,591

141,644

W.R. Grace & Co. (a)

12,355

152,831

 

2,571,365

Construction Materials - 0.3%

Vulcan Materials Co.

7,257

312,777

Containers & Packaging - 2.0%

Ball Corp.

15,300

690,948

Owens-Illinois, Inc. (a)

31,612

885,452

Rock-Tenn Co. Class A

9,690

369,770

 

1,946,170

Metals & Mining - 2.2%

Agnico-Eagle Mines Ltd. (Canada)

1,300

68,482

Alcoa, Inc.

33,300

343,989

Barrick Gold Corp.

6,700

225,522

Commercial Metals Co.

19,658

315,118

Eldorado Gold Corp. (a)

7,200

64,875

Goldcorp, Inc.

1,900

66,045

Lihir Gold Ltd. (a)

59,952

142,495

Newcrest Mining Ltd.

9,937

244,270

Newmont Mining Corp.

6,914

282,575

Randgold Resources Ltd. sponsored ADR

5,234

335,866

 

2,089,237

Common Stocks - continued

Shares

Value

MATERIALS - continued

Paper & Forest Products - 0.4%

Weyerhaeuser Co.

14,445

$ 439,561

TOTAL MATERIALS

7,359,110

TELECOMMUNICATION SERVICES - 0.7%

Diversified Telecommunication Services - 0.3%

Qwest Communications International,
Inc.

82,266

341,404

Wireless Telecommunication Services - 0.4%

Sprint Nextel Corp. (a)

72,200

347,282

TOTAL TELECOMMUNICATION SERVICES

688,686

UTILITIES - 7.2%

Electric Utilities - 4.9%

Allegheny Energy, Inc.

24,121

618,704

American Electric Power Co., Inc.

18,329

529,525

Edison International

5,200

163,592

Entergy Corp.

11,600

899,232

Exelon Corp.

13,300

681,093

FirstEnergy Corp.

19,100

740,125

Pinnacle West Capital Corp.

12,544

378,202

PPL Corp.

9,800

323,008

Southern Co.

13,500

420,660

 

4,754,141

Independent Power Producers & Energy Traders - 0.9%

AES Corp.

37,600

436,536

Calpine Corp. (a)

8,908

99,324

NRG Energy, Inc. (a)

13,934

361,727

 

897,587

Multi-Utilities - 1.4%

CenterPoint Energy, Inc.

27,100

300,268

PG&E Corp.

12,000

461,280

Sempra Energy

11,400

565,782

 

1,327,330

TOTAL UTILITIES

6,979,058

TOTAL COMMON STOCKS

(Cost $128,382,433)

94,196,839

Preferred Stocks - 0.2%

 

 

 

 

Convertible Preferred Stocks - 0.2%

FINANCIALS - 0.2%

Capital Markets - 0.1%

Legg Mason, Inc. 7.00%

2,900

72,860

Commercial Banks - 0.0%

KeyCorp Series A, 7.75%

300

20,850

 

Shares

Value

Diversified Financial Services - 0.1%

CIT Group, Inc. Series C, 8.75%

4,100

$ 70,713

TOTAL FINANCIALS

164,423

Nonconvertible Preferred Stocks - 0.0%

CONSUMER DISCRETIONARY - 0.0%

Automobiles - 0.0%

Fiat SpA (a)

7,800

48,113

TOTAL PREFERRED STOCKS

(Cost $430,449)

212,536

Convertible Bonds - 1.0%

 

Principal Amount

 

CONSUMER DISCRETIONARY - 0.6%

Automobiles - 0.5%

Ford Motor Co. 4.25% 12/15/36

$ 560,000

477,008

Diversified Consumer Services - 0.0%

Ingersoll-Rand Global Holding Co. Ltd. 4.5% 4/15/12

20,000

26,820

Household Durables - 0.1%

Newell Rubbermaid, Inc. 5.5% 3/15/14

20,000

28,233

TOTAL CONSUMER DISCRETIONARY

532,061

FINANCIALS - 0.1%

Real Estate Investment Trusts - 0.0%

Digital Realty Trust LP 5.5% 4/15/29 (f)

60,000

59,025

Thrifts & Mortgage Finance - 0.1%

MGIC Investment Corp. 9% 4/1/63 (d)(f)

182,000

75,530

TOTAL FINANCIALS

134,555

INDUSTRIALS - 0.1%

Electrical Equipment - 0.1%

Sunpower Corp. 4.75% 4/15/14

50,000

57,485

Industrial Conglomerates - 0.0%

Textron, Inc. 4.5% 5/1/13

30,000

30,099

TOTAL INDUSTRIALS

87,584

INFORMATION TECHNOLOGY - 0.0%

Semiconductors & Semiconductor Equipment - 0.0%

Micron Technology, Inc. 4.25% 10/15/13

30,000

35,363

Convertible Bonds - continued

 

Principal Amount

Value

MATERIALS - 0.2%

Metals & Mining - 0.2%

Newmont Mining Corp. 3% 2/15/12

$ 50,000

$ 56,375

United States Steel Corp. 4% 5/15/14

60,000

78,525

 

134,900

TOTAL CONVERTIBLE BONDS

(Cost $750,101)

924,463

Money Market Funds - 3.5%

Shares

 

Fidelity Cash Central Fund, 0.40% (b)

2,305,546

2,305,546

Fidelity Securities Lending Cash Central Fund, 0.22% (b)(c)

1,039,120

1,039,120

TOTAL MONEY MARKET FUNDS

(Cost $3,344,666)

3,344,666

TOTAL INVESTMENT PORTFOLIO - 102.5%

(Cost $132,907,649)

98,678,504

NET OTHER ASSETS - (2.5)%

(2,409,683)

NET ASSETS - 100%

$ 96,268,821

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 unaudited listing of the fund's holdings as of its most recent quarter end is available upon request.

(c) Investment made with cash collateral received from securities on loan.

(d) Non-income producing - Issuer is in default.

(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 end of the period, the value of these securities amounted to $134,555 or 0.1% of net assets.

Affiliated Central Funds

Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:

Fund

Income earned

Fidelity Cash Central Fund

$ 3,186

Fidelity Securities Lending Cash Central Fund

3,917

Total

$ 7,103

Other Information

The following is a summary of the inputs used, as of June 30, 2009, involving the Fund's assets and liabilities carried at value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the table below, please refer to the Security Valuation section in the accompanying Notes to Financial Statements.

Valuation Inputs at Reporting Date:

Description

Total

Level 1

Level 2

Level 3

Investments in Securities:

Equities:

Consumer Discretionary

$ 14,638,128

$ 14,544,239

$ 93,889

$ -

Consumer Staples

4,910,860

4,910,860

-

-

Energy

7,867,759

7,867,759

-

-

Financials

20,592,832

20,449,259

143,573

-

Health Care

2,680,933

2,680,933

-

-

Industrials

12,475,275

12,475,275

-

-

Information Technology

16,216,734

16,216,734

-

-

Materials

7,359,110

7,359,110

-

-

Telecommunication Services

688,686

688,686

-

-

Utilities

6,979,058

6,979,058

-

-

Valuation Inputs at Reporting Date:

Description

Total

Level 1

Level 2

Level 3

Investments in Securities:

Equities:

Corporate Bonds

$ 924,463

$ -

$ 924,463

$ -

Money Market Funds

3,344,666

3,344,666

-

-

Total Investments in Securities:

$ 98,678,504

$ 97,516,579

$ 1,161,925

$ -

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

United States of America

88.3%

Bermuda

3.1%

Canada

2.5%

Netherlands

1.0%

Others (individually less than 1%)

5.1%

 

100.0%

Income Tax Information

At December 31, 2008, the fund had a capital loss carryforward of approximately $9,301,735 all of which will expire on December 31, 2016.

The fund intends to elect to defer to its fiscal year ending December 31, 2009 approximately $4,450,267 of losses recognized during the period November 1, 2008 to December 31, 2008.

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

Semiannual Report

Financial Statements

Statement of Assets and Liabilities

 

June 30, 2009 (Unaudited)

 

 

 

Assets

Investment in securities, at value (including securities loaned of $994,666) - See accompanying schedule:

Unaffiliated issuers (cost $129,562,983)

$ 95,333,838

 

Fidelity Central Funds (cost $3,344,666)

3,344,666

 

Total Investments (cost $132,907,649)

 

$ 98,678,504

Foreign currency held at value (cost $857)

857

Receivable for investments sold

2,818,226

Receivable for fund shares sold

147,260

Dividends receivable

116,782

Interest receivable

3,921

Distributions receivable from Fidelity Central Funds

1,478

Prepaid expenses

452

Total assets

101,767,480

 

 

 

Liabilities

Payable for investments purchased

$ 4,363,130

Payable for fund shares redeemed

4,874

Accrued management fee

45,342

Distribution fees payable

1,296

Other affiliated payables

11,414

Other payables and accrued expenses

33,483

Collateral on securities loaned, at value

1,039,120

Total liabilities

5,498,659

 

 

 

Net Assets

$ 96,268,821

Net Assets consist of:

 

Paid in capital

$ 157,364,256

Undistributed net investment income

452,312

Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions

(27,318,129)

Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies

(34,229,618)

Net Assets

$ 96,268,821

Statement of Assets and Liabilities - continued

 

June 30, 2009 (Unaudited)

 

 

 

Initial Class:
Net Asset Value, offering price and redemption price per share ($47,562,022 ÷ 6,592,420 shares)

$ 7.21

 

 

 

Service Class:
Net Asset Value, offering price and redemption price per share ($184,653 ÷ 25,632 shares)

$ 7.20

 

 

 

Service Class 2:
Net Asset Value, offering price and redemption price per share ($6,014,856 ÷ 841,894 shares)

$ 7.14

 

 

 

Investor Class:
Net Asset Value, offering price and redemption price per share ($42,507,290 ÷ 5,898,115 shares)

$ 7.21

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

Semiannual Report

Financial Statements - continued

Statement of Operations

Six months ended June 30, 2009 (Unaudited)

 

 

 

Investment Income

 

 

Dividends

 

$ 794,218

Interest

 

13,373

Income from Fidelity Central Funds

 

7,103

Total income

 

814,694

 

 

 

Expenses

Management fee

$ 221,008

Transfer agent fees

58,743

Distribution fees

6,380

Accounting and security lending fees

15,971

Custodian fees and expenses

15,302

Independent trustees' compensation

302

Audit

25,014

Legal

56

Miscellaneous

3,380

Total expenses before reductions

346,156

Expense reductions

(24)

346,132

Net investment income (loss)

468,562

Realized and Unrealized Gain (Loss)

Net realized gain (loss) on:

Investment securities:

 

 

Unaffiliated issuers

(12,236,209)

Foreign currency transactions

(1,195)

Total net realized gain (loss)

 

(12,237,404)

Change in net unrealized appreciation (depreciation) on:

Investment securities

17,160,003

Assets and liabilities in foreign currencies

(149)

Total change in net unrealized appreciation (depreciation)

 

17,159,854

Net gain (loss)

4,922,450

Net increase (decrease) in net assets resulting from operations

$ 5,391,012

Statement of Changes in Net Assets

 

Six months ended June 30, 2009
(Unaudited)

Year ended
December 31, 2008

Increase (Decrease) in Net Assets

 

 

Operations

 

 

Net investment income (loss)

$ 468,562

$ 1,292,768

Net realized gain (loss)

(12,237,404)

(15,033,581)

Change in net unrealized appreciation (depreciation)

17,159,854

(45,673,621)

Net increase (decrease) in net assets resulting from operations

5,391,012

(59,414,434)

Distributions to shareholders from net investment income

(23,676)

(1,169,017)

Distributions to shareholders from net realized gain

-

(3,606,092)

Total distributions

(23,676)

(4,775,109)

Share transactions - net increase (decrease)

8,162,694

21,293,415

Total increase (decrease) in net assets

13,530,030

(42,896,128)

 

 

 

Net Assets

Beginning of period

82,738,791

125,634,919

End of period (including undistributed net investment income of $452,312 and undistributed net investment income of $7,426, respectively)

$ 96,268,821

$ 82,738,791

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

Semiannual Report

Financial Highlights - Initial Class

 

Six months ended June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 6.69

$ 13.10

$ 14.28

$ 12.63

$ 11.97

$ 10.86

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .04

.13

.10

.16

.15

.14 H

Net realized and unrealized gain (loss)

  .48

(6.07)

.22 I

1.70

.58

1.08

Total from investment operations

  .52

(5.94)

.32

1.86

.73

1.22

Distributions from net investment income

  - K

(.10)

(.09)

(.13)

(.07)

(.11)

Distributions from net realized gain

  -

(.37)

(1.41)

(.08)

-

-

Total distributions

  - K

(.47)

(1.50) L

(.21)

(.07)

(.11)

Net asset value, end of period

$ 7.21

$ 6.69

$ 13.10

$ 14.28

$ 12.63

$ 11.97

Total Return B,C,D

  7.81%

(46.50)%

2.02%

14.75%

6.09%

11.24%

Ratios to Average Net Assets F,J

 

 

 

 

 

 

Expenses before reductions

  .83% A

.79%

.77%

.88%

1.19%

2.65%

Expenses net of fee waivers, if any

  .83% A

.79%

.77%

.85%

.85%

1.00%

Expenses net of all reductions

  .83% A

.79%

.77%

.84%

.78%

.95%

Net investment income (loss)

  1.26% A

1.25%

.68%

1.16%

1.21%

1.26%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 47,562

$ 41,306

$ 52,544

$ 35,416

$ 18,478

$ 583

Portfolio turnover rate G

  71% A

53%

52%

263%

181%

155%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H Investment income per share reflects a special dividend which amounted to $.03 per share. I The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund. J 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 fee 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. K Amount represents less than $.01 per share. L Total distributions of $1.50 per share is comprised of distributions from net investment income of $.092 and distributions from net realized gain of $1.405 per share.

Financial Highlights - Service Class

 

Six months ended June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 6.69

$ 13.06

$ 14.24

$ 12.60

$ 11.93

$ 10.84

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .04

.13

.09

.14

.13

.13 H

Net realized and unrealized gain (loss)

  .47

(6.05)

.21 I

1.69

.60

1.07

Total from investment operations

  .51

(5.92)

.30

1.83

.73

1.20

Distributions from net investment income

  - K

(.08)

(.08)

(.11)

(.06)

(.11)

Distributions from net realized gain

  -

(.37)

(1.41)

(.08)

-

-

Total distributions

  - K

(.45)

(1.48) L

(.19)

(.06)

(.11)

Net asset value, end of period

$ 7.20

$ 6.69

$ 13.06

$ 14.24

$ 12.60

$ 11.93

Total Return B,C,D

  7.66%

(46.49)%

1.92%

14.56%

6.08%

11.07%

Ratios to Average Net Assets F,J

 

 

 

 

 

 

Expenses before reductions

  .94% A

.88%

.86%

.96%

1.60%

2.75%

Expenses net of fee waivers, if any

  .94% A

.88%

.86%

.95%

.97%

1.10%

Expenses net of all reductions

  .94% A

.88%

.86%

.94%

.90%

1.04%

Net investment income (loss)

  1.15% A

1.17%

.60%

1.06%

1.09%

1.17%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 185

$ 293

$ 958

$ 1,017

$ 1,232

$ 1,225

Portfolio turnover rate G

  71% A

53%

52%

263%

181%

155%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H Investment income per share reflects a special dividend which amounted to $.03 per share. I The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund. J 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 fee 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. K Amount represents less than $.01 per share. L Total distributions of $1.48 per share is comprised of distributions from net investment income of $.077 and distributions from net realized gain of $1.405 per share.

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

Semiannual Report

Financial Highlights - Service Class 2

 

Six months ended June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005
2004

Selected Per-Share Data

 

 

 

 

 

 

Net asset value, beginning of period

$ 6.63

$ 12.97

$ 14.14

$ 12.53

$ 11.87

$ 10.80

Income from Investment Operations

 

 

 

 

 

 

Net investment income (loss) E

  .03

.11

.06

.12

.11

.11 H

Net realized and unrealized gain (loss)

  .48

(6.01)

.23 I

1.67

.59

1.07

Total from investment operations

  .51

(5.90)

.29

1.79

.70

1.18

Distributions from net investment income

  - K

(.07)

(.06)

(.10)

(.04)

(.11)

Distributions from net realized gain

  -

(.37)

(1.41)

(.08)

-

-

Total distributions

  - K

(.44)

(1.46) L

(.18)

(.04)

(.11)

Net asset value, end of period

$ 7.14

$ 6.63

$ 12.97

$ 14.14

$ 12.53

$ 11.87

Total Return B,C,D

  7.73%

(46.68)%

1.86%

14.32%

5.92%

10.93%

Ratios to Average Net Assets F,J

 

 

 

 

 

 

Expenses before reductions

  1.08% A

1.04%

1.02%

1.15%

1.76%

2.93%

Expenses net of fee waivers, if any

  1.08% A

1.04%

1.02%

1.10%

1.11%

1.25%

Expenses net of all reductions

  1.08% A

1.04%

1.02%

1.09%

1.05%

1.20%

Net investment income (loss)

  1.00% A

1.01%

.43%

.91%

.94%

1.01%

Supplemental Data

 

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 6,015

$ 4,941

$ 11,081

$ 7,803

$ 5,262

$ 3,575

Portfolio turnover rate G

  71% A

53%

52%

263%

181%

155%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H Investment income per share reflects a special dividend which amounted to $.03 per share. I The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund. J 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 fee 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. K Amount represents less than $.01 per share. L Total distributions of $1.46 per share is comprised of distributions from net investment income of $.058 and distributions from net realized gain of $1.405 per share.

Financial Highlights - Investor Class

 

Six months ended June 30, 2009
Years ended December 31,
 
(Unaudited)
2008
2007
2006
2005 I

Selected Per-Share Data

 

 

 

 

 

Net asset value, beginning of period

$ 6.69

$ 13.09

$ 14.26

$ 12.63

$ 12.23

Income from Investment Operations

 

 

 

 

 

Net investment income (loss) E

  .04

.12

.08

.14

.06

Net realized and unrealized gain (loss)

  .48

(6.06)

.23 H

1.69

.40

Total from investment operations

  .52

(5.94)

.31

1.83

.46

Distributions from net investment income

  - K

(.09)

(.08)

(.12)

(.06)

Distributions from net realized gain

  -

(.37)

(1.41)

(.08)

-

Total distributions

  - K

(.46)

(1.48) L

(.20)

(.06)

Net asset value, end of period

$ 7.21

$ 6.69

$ 13.09

$ 14.26

$ 12.63

Total Return B,C,D

  7.81%

(46.53)%

1.99%

14.49%

3.77%

Ratios to Average Net Assets F,J

 

 

 

 

 

Expenses before reductions

  .92% A

.87%

.88%

.99%

1.27% A

Expenses net of fee waivers, if any

  .92% A

.87%

.88%

.99%

1.00% A

Expenses net of all reductions

  .92% A

.87%

.88%

.98%

.93% A

Net investment income (loss)

  1.16% A

1.17%

.58%

1.01%

1.06% A

Supplemental Data

 

 

 

 

 

Net assets, end of period (000 omitted)

$ 42,507

$ 36,199

$ 61,052

$ 37,239

$ 11,034

Portfolio turnover rate G

  71% A

53%

52%

263%

181%

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 Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds. G Amount does not include the portfolio activity of any underlying Fidelity Central Funds. H The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund. I For the period July 21, 2005 (commencement of sale of shares) to December 31, 2005. J 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 fee 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. K Amount represents less than $.01 per share. L Total distributions of $1.48 per share is comprised of distributions from net investment income of $.078 and distributions from net realized gain of $1.405 per share.

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

Semiannual Report

Notes to Financial Statements

For the period ended June 30, 2009 (Unaudited)

1. Organization.

VIP Value Portfolio (the Fund) is a fund of Variable Insurance Products Fund (the trust) and is authorized to issue an unlimited number of shares. The trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. Shares of the Fund may only be purchased by insurance companies for the purpose of funding variable annuity or variable life insurance contracts. The Fund offers the following classes of shares: Initial Class shares, Service Class shares, Service Class 2 shares, and Investor Class 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 transfer agent and distribution and service plan fees incurred. Certain expense reductions also differ by class.

2. Investments in Fidelity Central Funds.

The Fund may invest in Fidelity Central Funds, which are open-end investment companies available only to other investment companies and accounts managed by Fidelity Management & Research Company (FMR) and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.

The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of FMR.

A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the SEC's web site at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC's web site or upon request.

3. Significant Accounting Policies.

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. Actual results could differ from those estimates. Events or transactions occurring after period end through the date that the financial statements were issued, August 13, 2009, have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:

Security Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Fund uses independent pricing services approved by the Board of Trustees to value its investments. Generally Accepted Accounting Principles (GAAP) establishes a disclosure hierarchy that categorizes the inputs to valuation techniques used to value assets and liabilities at measurement date. These inputs are classified into three levels. Level 1 includes readily available unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 includes observable inputs other than quoted prices included in Level 1 that are observable either directly or indirectly. Level 3 includes unobservable inputs when market prices are not readily available or reliable. Changes in valuation techniques may result in transfers in or out of an investment's assigned level within the hierarchy. The aggregate value by input level, as of June 30, 2009, for the Fund's investments is included at the end of the Fund's Schedule of Investments. Valuation techniques of the Fund's major categories of assets and liabilities as presented in the Schedule of Investments are as follows.

Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by an independent pricing service on the primary market or exchange on which they are traded. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price. Debt securities, including restricted securities, are valued based on quotations received from dealers who make markets in such securities or by independent pricing services. For corporate bonds pricing services generally utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type as well as dealer supplied prices. Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value each business day. Short-term securities with remaining maturities of sixty days or less for which quotations are not readily available are valued at amortized cost, which approximates value.

When current market prices or quotations are not readily available or reliable, valuations may be determined in good faith in accordance with procedures adopted by the Board of Trustees. Factors used in determining value may include significant market or security specific events, changes in interest rates and credit quality, and developments in foreign markets which are monitored by evaluating the performance of ADRs, futures contracts and exchange-traded funds. The frequency with which these procedures are used cannot be predicted and may be utilized to a significant extent. The value of securities used for net asset value (NAV) calculation under these procedures may differ from published prices for the same securities.

Foreign Currency. The Fund uses 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.

Semiannual Report

Notes to Financial Statements (Unaudited) - continued

3. Significant Accounting Policies - continued

Foreign Currency - continued

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. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. 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 Fund is 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 Fund estimates the components of distributions received that may be considered return of capital distributions or capital gain distributions. Interest income and distributions from the Fidelity Central Funds are accrued as earned. Interest income includes coupon interest and amortization of premium and accretion of discount on debt securities. 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 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 collectability of interest is reasonably assured.

Expenses. Most expenses of the trust can be directly attributed to a fund. Expenses which cannot be directly attributed are apportioned among each Fund in the trust. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.

Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company by distributing substantially all of its taxable income and realized gains under Subchapter M of the Internal Revenue Code and filing its U.S. federal tax return. As a result, no provision for income taxes is required. The Fund is subject to the provisions of FASB Interpretation No. 48, Accounting for Uncertainties in Income Taxes (FIN 48). FIN 48 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. There are no unrecognized tax benefits in the accompanying financial statements. A Fund's federal tax return is subject to examination by the Internal Revenue Service (IRS) for a period of three years. Foreign taxes are provided for based on the 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 foreign currency transactions, partnerships, capital loss carryforwards and losses deferred due to wash sales and excise tax regulations.

The federal tax cost of investments and unrealized appreciation (depreciation) as of period end were as follows:

Unrealized appreciation

$ 6,113,042

Unrealized depreciation

(41,261,475)

Net unrealized appreciation (depreciation)

$ (35,148,433)

Cost for federal income tax purposes

$ 133,826,937

4. Operating Policies.

Restricted Securities. The Fund 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 the Fund's Schedule of Investments.

Semiannual Report

5. Purchases and Sales of Investments.

Purchases and sales of securities, other than short-term securities, aggregated $36,775,321 and $27,771,050, respectively.

6. Fees and Other Transactions with Affiliates.

Management Fee. FMR and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .30% of the Fund's average net assets and a group fee rate that averaged .27% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by FMR. The group fee rate decreases as assets under management increase and increases as assets under management decrease. For the period, the total annualized management fee rate was .56% of the Fund's average net assets.

Distribution and Service Plan. In accordance with Rule 12b-1 of the 1940 Act, the Fund has 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

$ 117

Service Class 2

6,263

 

$ 6,380

Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc. (FIIOC), an affiliate of FMR, is the Fund's transfer, dividend disbursing, and shareholder servicing agent. FIIOC receives an asset-based fee with respect to each class. Each class (with the exception of Investor Class) pays a transfer agent fee, excluding out of pocket expenses, equal to an annual rate of .07% of average net assets. Investor Class pays a monthly asset-based transfer agent fee of .15% of average net assets. The total transfer agent fees paid by each class to FIIOC, including out of pocket expenses, were as follows:

Initial Class

$ 21,208

Service Class

136

Service Class 2

2,764

Investor Class

34,635

 

$ 58,743

Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of FMR, maintains the 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.

Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. The commissions paid to these affiliated firms were $1,075 for the period.

7. Committed Line of Credit.

The Fund participates with other funds managed by FMR in a $3.5 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 Fund has agreed to pay commitment fees on its pro-rata portion of the line of credit, which amounted to $229 and is reflected in Miscellaneous Expense on the Statement of Operations. During the period, there were no borrowings on this line of credit.

8. Security Lending.

The Fund lends portfolio securities from time to time in order to earn additional income. On the settlement date of the loan, the 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 Fund and any additional required collateral is delivered to the Fund 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. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. Security lending income represents the income earned on investing cash collateral, less fees and expenses associated with the loan, plus any premium payments that may be received on

Semiannual Report

Notes to Financial Statements (Unaudited) - continued

8. Security Lending - continued

the loan of certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds. Net income from lending portfolio securities during the period amounted to $3,917.

9. Expense Reductions.

Many of the brokers with whom FMR places trades on behalf of the Fund provided services to the Fund in addition to trade execution. These services included payments of certain expenses on behalf of the Fund totaling $24 for the period.

10. Distributions to Shareholders.

Distributions to shareholders of each class were as follows:

 

Six months ended
June 30,
2009

Year ended
December 31,
2008

From net investment income

 

 

Initial Class

$ 11,809

$ 616,899

Service Class

81

3,725

Service Class 2

1,469

51,555

Investor Class

10,317

496,838

Total

$ 23,676

$ 1,169,017

From net realized gain

 

 

Initial Class

$ -

$ 1,550,219

Service Class

-

27,064

Service Class 2

-

300,918

Investor Class

-

1,727,891

Total

$ -

$ 3,606,092

11. Share Transactions.

Transactions for each class of shares were as follows:

 

Shares

Dollars

Six months ended June 30,
2009

Year ended
December 31,
2008

Six months ended June 30,
2009

Year ended
December 31,
2008

Initial Class

 

 

 

 

Shares sold

1,435,529

3,223,694

$ 9,541,186

$ 28,731,973

Reinvestment of distributions

1,978

226,797

11,809

2,167,047

Shares redeemed

(1,018,120)

(1,287,498)

(6,210,215)

(13,483,541)

Net increase (decrease)

419,387

2,162,993

$ 3,342,780

$ 17,415,479

Service Class

 

 

 

 

Shares sold

231

388

$ 1,473

$ 4,284

Reinvestment of distributions

13

2,886

81

30,789

Shares redeemed

(18,377)

(32,811)

(120,126)

(294,997)

Net increase (decrease)

(18,133)

(29,537)

$ (118,572)

$ (259,924)

Service Class 2

 

 

 

 

Shares sold

208,869

332,542

$ 1,309,726

$ 3,626,908

Reinvestment of distributions

248

33,900

1,469

352,473

Shares redeemed

(111,930)

(476,305)

(726,181)

(5,036,302)

Net increase (decrease)

97,187

(109,863)

$ 585,014

$ (1,056,921)

Investor Class

 

 

 

 

Shares sold

1,325,567

2,041,288

$ 9,398,850

$ 18,461,315

Reinvestment of distributions

1,728

223,750

10,317

2,224,729

Shares redeemed

(842,035)

(1,516,336)

(5,055,695)

(15,491,263)

Net increase (decrease)

485,260

748,702

$ 4,353,472

$ 5,194,781

Semiannual Report

12. Other.

The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund's maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

At the end of the period, VIP Freedom 2020 Portfolio was the owner of record of approximately 16% of the total outstanding shares of the Fund. The VIP Freedom Funds were the owners of record, in the aggregate, of approximately 37% of the total outstanding shares of the Fund. FMR or its affiliates were the owners of record of 36% of the total outstanding shares of the Fund.

Semiannual Report

Investment Adviser

Fidelity Management & Research Company
Boston, MA

Investment Sub-Advisers

FMR Co., Inc.

Fidelity Management & Research (U.K.) Inc.

Fidelity Research & Analysis Company

Fidelity Investments Japan Limited

FIL Investment Advisors

FIL Investment Advisors (U.K.) Ltd.

Fidelity Management & Research (Hong Kong) Limited

Fidelity Management & Research (Japan) Inc.

General Distributor

Fidelity Distributors Corporation
Boston, MA

Transfer and Service Agents

Fidelity Investments Institutional Operations Company, Inc.
Boston, MA 

Fidelity Service Company, Inc.
Boston, MA 

Custodian

State Street Bank and Trust Company
Quincy, MA 

VIPVAL-SANN-0809
1.761034.108

Item 2. Code of Ethics

Not applicable.

Item 3. Audit Committee Financial Expert

Not applicable.

Item 4. Principal Accountant Fees and Services

Not applicable.

Item 5. Audit Committee of Listed Registrants

Not applicable.

Item 6. Investments

(a) Not applicable.

(b) 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 Variable Insurance Products Fund's Board of Trustees.

Item 11. Controls and Procedures

(a)(i) The President and Treasurer and the Chief Financial Officer have concluded that the disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act) for each Fund provide reasonable assurances that material information relating to such Fund 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 a Fund'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, a Fund's internal control over financial reporting.

Item 12. Exhibits

(a)

(1)

Not applicable.

(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/Kenneth B. Robins

 

Kenneth B. Robins

 

President and Treasurer

 

 

Date:

August 21, 2009

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/Kenneth B. Robins

 

Kenneth B. Robins

 

President and Treasurer

 

 

Date:

August 21, 2009

By:

/s/Christine Reynolds

 

Christine Reynolds

 

Chief Financial Officer

 

 

Date:

August 21, 2009