0000722574-11-000370.txt : 20120327 0000722574-11-000370.hdr.sgml : 20120327 20111208152635 ACCESSION NUMBER: 0000722574-11-000370 CONFORMED SUBMISSION TYPE: CORRESP PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 20111208 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FIDELITY CHARLES STREET TRUST CENTRAL INDEX KEY: 0000354046 IRS NUMBER: 000000000 FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: CORRESP BUSINESS ADDRESS: STREET 1: 82 DEVONSHIRE STREET CITY: BOSTON STATE: MA ZIP: 02109 BUSINESS PHONE: 617-563-7000 MAIL ADDRESS: STREET 1: 82 DEVONSHIRE STREET CITY: BOSTON STATE: MA ZIP: 02109 FORMER COMPANY: FORMER CONFORMED NAME: FIDELITY U S GOVERNMENT RESERVES FUND DATE OF NAME CHANGE: 19880201 FORMER COMPANY: FORMER CONFORMED NAME: FIDELITY FEDERAL RESERVES DATE OF NAME CHANGE: 19820215 FORMER COMPANY: FORMER CONFORMED NAME: FIDELITY UNITED STATES TREASURY TRUST DATE OF NAME CHANGE: 19811020 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FIDELITY ADVISOR SERIES I CENTRAL INDEX KEY: 0000722574 IRS NUMBER: 043335387 STATE OF INCORPORATION: MA FISCAL YEAR END: 1130 FILING VALUES: FORM TYPE: CORRESP BUSINESS ADDRESS: STREET 1: 82 DEVONSHIRE STREET CITY: BOSTON STATE: MA ZIP: 02109 BUSINESS PHONE: 617-563-7000 MAIL ADDRESS: STREET 1: 82 DEVONSHIRE STREET CITY: BOSTON STATE: MA ZIP: 02109 FORMER COMPANY: FORMER CONFORMED NAME: FIDELITY ADVISOR SERIES 1 DATE OF NAME CHANGE: 19930706 FORMER COMPANY: FORMER CONFORMED NAME: FIDELITY BROAD STREET TRUST DATE OF NAME CHANGE: 19920820 FORMER COMPANY: FORMER CONFORMED NAME: FIDELITY ADVISOR EQUITY PORTFOLIO GROWTH DATE OF NAME CHANGE: 19920703 CORRESP 1 filename1.htm

COMMENTS RECEIVED ON NOVEMBER 29, 2011

FROM EDWARD BARTZ

FIDELITY ADVISOR SERIES I (File Nos. 002-84776 and 811-03785)

Fidelity Advisor Floating Rate High Income Fund
Fidelity Advisor High Income Advantage Fund
Fidelity Advisor High Income Fund

POST-EFFECTIVE AMENDMENT NO. 106

FIDELITY CHARLES STREET TRUST (File Nos. 002-73133 and 811-03221)

Fidelity Global Balanced Fund

POST-EFFECTIVE AMENDMENT NO. 103

1. Fidelity Global Balanced Fund

"Fee Table" (prospectuses)

"[[X] The fund may invest in Fidelity Commodity Strategy Central Fund, which in turn invests in a wholly-owned subsidiary that invests in commodity-linked derivative instruments. Fidelity Management & Research Company (FMR) has contractually agreed to waive the fund's management fee in an amount equal to its proportionate share of the management fee paid to FMR by the subsidiary based on the fund's proportionate ownership of the central fund. This arrangement will remain in effect for at least one year from the effective date of the prospectus, and will remain in effect thereafter as long as FMR's contract with the subsidiary is in place. If FMR's contract with the subsidiary is terminated, FMR, in its sole discretion, may discontinue the arrangement. [For the fund's most recent fiscal year, the waiver rounded to less than 0.01% for the class.]]"

C: The Staff requests confirmation that the agreement will be provided as an exhibit to the registration statement.

R: As disclosed, this arrangement will remain in effect for at least a year from the effective date of the prospectus, but there is no agreement to be filed under Item 28(h). Instead, this arrangement is a unilateral undertaking by FMR in order to avoid the potential for duplication of management fees. Because Commodity Strategy Central Fund's wholly-owned subsidiary is managed by FMR, FMR has unilaterally undertaken to waive its management fee from Global Balanced Fund to the extent that Global Balanced invests in Commodity Strategy Central, which in turn invests a portion of its assets in its wholly owned subsidiary.

2. Fidelity Global Balanced Fund and Fidelity Floating Rate High Income Fund

"Fund Summary" (prospectuses)

"Principal Investment Strategies"

(Example from Fidelity Global Balanced Fund)
"Investing in equity and debt securities, including lower-quality debt securities, issued anywhere in the world."

C: The Staff requests that lower-quality debt securities be referred to as "junk bonds."

R: We are not aware of any requirements to use the term "junk bonds" in disclosure regarding "lower-quality debt securities." It is our understanding that the Division's formal guidance on "junk bond" disclosure was rescinded as part of the general overhaul of Form N-1A in 1998. See footnote 214 to Investment Company Act Release No. 23064 (Mar. 13, 1998) (providing that generic comment letters will not apply to registration statements prepared on the amended Form). Further, we note that the term "lower-quality debt securities" is defined under the heading "Principal Investment Risks" in the "Issuer Specific Changes" paragraph. Accordingly, we respectfully decline to modify the disclosure.

3. Fidelity Global Balanced Fund

"Fund Summary" (prospectuses)

"Principal Investment Strategies"

"Allocating investments across different countries and regions."

C: The Staff believes that the policy should provide more description of the allocations, including investing "a significant amount outside the U.S." and investing in "at least three countries."

R: The fund normally allocates its investments across different countries and regions. As disclosed, FMR analyzes issuers using fundamental factors (e.g., financial condition, earnings outlook, and strategy) and evaluates each security's current price relative to estimated long-term value to select investments. The number of different countries represented by the fund's holdings may vary from time to time. Further, we understand that the Staff has changed its position in recent years (see Name Test Rule Proposing Release footnote 38) and that the Staff currently views the term "global" to connote that a fund will invest its assets in investments tied economically to a number of different countries throughout the world (see Name Test Rule Adopting Release footnote 42). We believe the fund's policies are consistent with the Staff's current position as set forth in the Name Test Rule Adopting Release and accordingly have not modified disclosure.

4. Fidelity Global Balanced Fund, Fidelity High Income Advantage Fund, and Fidelity High Income Fund

"Fund Summary" (prospectuses)

"Principal Investment Risks"

(Example from Fidelity Global Balanced Fund)
"Foreign Exposure. Foreign markets, particularly emerging markets, can be more volatile than the U.S. market due to increased risks of adverse issuer, political, regulatory, market, or economic developments and can perform differently from the U.S. market. Emerging markets can be subject to greater social, economic, regulatory, and political uncertainties and can be extremely volatile."

C: The Staff requests we add an emerging markets strategy to "Principal Investment Strategies" in the "Fund Summary" section.

R: The funds do not have a principal investment strategy to invest in emerging markets. Accordingly, we have not modified disclosure.

5. All funds

"Fund Summary" (prospectuses)

"Purchase and Sale of Shares"

(Example from Fidelity Advisor Floating Rate High Income Fund)

"You may buy or sell shares of the fund through a Fidelity brokerage or mutual fund account, through a retirement account, or through an investment professional. You may buy or sell shares in various ways:

Internet

www.fidelity.com

Phone

Fidelity Automated Service Telephone (FAST®) 1-800-544-5555

To reach a Fidelity representative 1-800-544-6666

Mail

Additional purchases:

Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0003

Redemptions:

Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0035

TDD - Service for the Deaf and Hearing Impaired

1-800-544-0118

The price to buy one share of the fund is its net asset value per share (NAV). Your shares will be bought at the NAV next calculated after your investment is received in proper form.

The price to sell one share of the fund is its NAV, minus the short-term redemption fee, if applicable. Your shares will be sold at the NAV next calculated after your order is received in proper form, minus the short-term redemption fee, if applicable.

The fund is open for business each day the New York Stock Exchange (NYSE) is open.

Initial Purchase Minimum

$2,500

For Fidelity Simplified Employee Pension-IRA and Keogh accounts, and Non-Fidelity Prototype Retirement accounts

$500

Through regular investment plans in Fidelity Traditional IRAs, Roth IRAs, and Rollover IRAs (requires monthly purchases of $200 until fund balance is $2,500)

$200

The fund may waive or lower purchase minimums in other circumstances."

C: The Staff requests that we remove any information that does not confirm with Items 6(a) and 6(b), which require information pertaining to minimum initial investment, subsequent investment, and redemption procedures.

R: We believe the disclosure at issue is consistent with the purchase and sale information required by Item 6(a) and (b). Accordingly, we have not modified disclosure.

6. Fidelity Global Balanced Fund

"Investment Details" (prospectus)

"Principal Investment Risks"

"Commodity-Linked Investing. The performance of commodity-linked notes and related investments may depend on the performance of the overall commodities markets and on other factors that affect the value of commodities, including weather, political, tax, and other regulatory and market developments. Commodity-linked notes may be leveraged. For example, the price of a three-times leveraged note may change by a magnitude of three for every percentage change (positive or negative) in the value of the underlying index. Commodity-linked investments may be hybrid instruments that can have substantial risk of loss with respect to both principal and interest. Commodity-linked investments may be more volatile and less liquid than the underlying commodity, instruments, or measures, are subject to the credit risks associated with the issuer, and their values may decline substantially if the issuer's creditworthiness deteriorates. As a result, returns of commodity-linked investments may deviate significantly from the return of the underlying commodity, instruments, or measures."

C: The Staff requests that we include commodity-linked investing risk in the "Fund Summary" section. The Staff also requests that we include a corresponding strategy in the "Fund Summary" and "Investment Details" sections.

R: We believe that the disclosure under the sub-headings "Principal Investment Strategies" and "Principal Investment Risks" in the "Fund Summary" and "Investment Details" sections appropriately discloses the fund's principal investment strategies and risks. We note that the fund may invest in a central fund that focuses on commodity-linked derivative instruments. Because these types of investments may be leveraged, investment risks can be magnified. For this reason we believe it is important to disclose the risks commodity-linked investing may entail, even though not considered to be a principal strategy or principal risk for the fund. If the risk associated with commodity-linked investing becomes a principal investment risk in the future, we will add disclosure at that time.

7. All funds

"Trustees and Officers" (SAIs)

"Experience, Skills, Attributes, and Qualifications of the Fund's Trustees. The Governance and Nominating Committee has adopted a statement of policy that describes the experience, qualifications, attributes, and skills that are necessary and desirable for potential Independent Trustee candidates (Statement of Policy). The Board believes that each Trustee satisfied at the time he or she was initially elected or appointed a Trustee, and continues to satisfy, the standards contemplated by the Statement of Policy. The Governance and Nominating Committee also engages professional search firms to help identify potential Independent Trustee candidates who have the experience, qualifications, attributes, and skills consistent with the Statement of Policy. From time to time, additional criteria based on the composition and skills of the current Independent Trustees, as well as experience or skills that may be appropriate in light of future changes to board composition, business conditions, and regulatory or other developments, have also been considered by the professional search firms and the Governance and Nominating Committee. In addition, the Board takes into account the Trustees' commitment and participation in Board and committee meetings, as well as their leadership of standing and ad hoc committees throughout their tenure.

In determining that a particular Trustee was and continues to be qualified to serve as a Trustee, the Board has considered a variety of criteria, none of which, in isolation, was controlling. The Board believes that, collectively, the Trustees have balanced and diverse experience, qualifications, attributes, and skills, which allow the Board to operate effectively in governing the fund and protecting the interests of shareholders. Information about the specific experience, skills, attributes, and qualifications of each Trustee, which in each case led to the Board's conclusion that the Trustee should serve (or continue to serve) as a trustee of the fund, is provided below."

C: The Staff asserts that the current disclosure in the Trustees and Officers section does not adequately describe the reasoning behind each Trustee's appointment to the Board. The Staff also requests that additional information be added describing why a particular Trustee's skills or background are conducive to their position on the Board.

R: We continue to be of the view that, as required by Item 17(b)(10), the current disclosure in the "Trustees and Officers" section includes a brief discussion of the experience, qualifications, attributes, or skills that led to the conclusion that each Trustee should serve as a Trustee for the funds. In addition to the disclosure cited by the Staff, we call the Staff's attention to the disclosure under "Standing Committees of the Fund's Trustees" that describes certain minimum qualifications for Independent Trustees, and to each Trustee's biographical information, which includes each Trustee's principal occupation during the last five years and other information relating to the experience, attributes, and skills relevant to each Trustee's qualifications to serve as a Trustee, and which led to the conclusion that each Trustee should serve as a Trustee for the funds.




8. All funds

"Trustees and Officers" (SAIs)

C: The Staff would like confirmation that biographies reflect all directorships for the past five years.

R: In accordance with Item 17 of Form N-1A, directorships held during the past five years are disclosed.

9. Fidelity Global Balanced Fund, Fidelity Advisor Floating Rate High Income Fund, Fidelity Advisor High Income Advantage Fund, and Fidelity Advisor High Income Fund

"Fund Summary" (prospectuses)

"Fee Table"

(Example of disclosure for Fidelity Global Balanced Fund)

Shareholder fees
(fees paid directly from your investment)

 

 

Class A
 
Class T
 
Class B
 
Class C

Maximum sales charge (load) on purchases (as a % of offering price)

5.75%

 

3.50%

 

None

 

None

Maximum contingent deferred sales charge (as a % of the lesser of original purchase price or redemption proceeds)

NoneA

 

NoneA

 

5.00%B

 

1.00%C

Redemption fee on shares held less than 30 days (as a % of amount redeemed)

1.00%

 

1.00%

 

1.00%

 

1.00%

A Class A and Class T purchases of $1 million or more will not be subject to a front-end sales charge. Such Class A and Class T purchases may be subject, upon redemption, to a contingent deferred sales charge (CDSC) of 1.00% or 0.25%, respectively.

B Declines over 6 years from 5.00% to 0%.

C On Class C shares redeemed less than one year after purchase.

C: The Staff requests we update the maximum contingent deferred sales charge line item to read "1.00% or 0.75%," as applicable, for Class A and "0.25%" for Class T instead of "none."

R: Were we to make the requested change, the table would reflect more than one type of sales charge. We understand that this is appropriate, in accordance with Instruction 2(a)(ii) to Item 3, "[i]f more than one type of sales charge (load) is imposed (e.g., a deferred sales charge (load) and a front-end sales charge (load))" (in which case the first caption in the table would read "Maximum Sales Charge (Load)" and would show the maximum cumulative percentage). However, we believe this result would not be appropriate for these funds as they do not charge both a front-end sales charge and deferred sales charge with respect tot he same shares, and therefore reflecting a maximum cumulative percentage would overstate the maximum that could be charged. Since we believe it is important to communicate that certain purchases not subject to a front-end sales charge may be subject to a deferred sales charge instead, we disclose the maximum front-end sales charge in the table and include a footnote to the table, consistent with Instruction 2(a)(i), related to the amount of the deferred sales charge that may apply if a front-end sales charge does not. Accordingly, we have not modified disclosure.

10. All funds

"Fund Summary" (prospectuses)

"Fee Table"

C: The Staff requests that the footnotes below the "Shareholder fees" table be relocated to the end of the "Annual class operating expenses" table.

R: As we have previously discussed with the Staff, we believe that the information included under the subheadings "Shareholder fees" and "Annual class operating expenses" in the "Fee Table" section of the prospectus is presented in a manner consistent with Item 3 of Form N-1A. The footnotes that support the information under each subheading are provided in the closest proximity possible to that information to facilitate shareholder understanding of the information presented. We note that General Instruction C.1(a) to Form N-1A states that a fund should use document design techniques that promote effective communication, and we believe this format most effectively communicates the information presented.

11. Fidelity Advisor Floating Rate High Income Fund

"Fund Summary" and "Investment Details" (prospectuses)

"Principal Investment Strategies"

(Fund Summary)
"Normally investing at least 80% of assets in floating rate loans, which are often lower-quality debt securities and other floating rate securities."

(Investment Details)
"FMR normally invests at least 80% of the fund's assets in floating rate loans and other floating rate securities. FMR defines floating rate securities as floating rate loans, other floating rate debt securities, money market securities of all types, repurchase agreements, and shares of money market and short-term bond funds. Many floating rate loans are lower-quality. FMR may invest in companies whose financial condition is troubled or uncertain and that may be involved in bankruptcy proceedings, reorganizations, or financial restructurings."

C: The Staff would like us to define "other floating rate securities."

R: In addition to floating rate loans, floating rate securities are defined by FMR to include the securities identified in the sentence following the sentence at issue in the "Investment Details" section. Accordingly, we have not modified disclosure.

12. Fidelity Advisor Floating Rate High Income Fund

"Fund Summary" (prospectuses)

"Principal Investment Strategies"

"Normally investing at least 80% of assets in floating rate loans, which are often lower-quality debt securities, and other floating rate securities."

C: The Staff would like us to disclose the maturity policy for floating rate securities.

R: The fund does not have a principal investment strategy to invest in securities of a particular maturity.

13. Fidelity Floating Rate High Income Fund

"Investment Details" (Prospectuses)

"Principal Investment Strategies"

"In addition to the principal investment strategies discussed above, FMR may use various techniques, such as buying and selling futures contracts and exchange traded funds, to increase or decrease the fund's exposure to changing security prices, interest rates, or other factors that affect security values."

C: The Staff questions whether the fund will use derivatives to meet the 80% test.

R: Though we understand that in appropriate circumstances derivatives may qualify for a fund's name test, at this time the fund does not intend to count derivatives for purposes of its 80% policy.

14. Fidelity Advisor High Income Advantage Fund and Fidelity Advisor High Income Fund

"Fund Summary" (prospectuses)

"Principal Investment Strategies"

C: The Staff requests that we disclose the maturity policy for each fund.

R: The funds do not have a principal investment strategy to invest in securities of a particular maturity. Accordingly, we have not modified disclosure.

15. All funds

Tandy Representations (prospectuses and SAIs)

C: The Staff would like us to affirm the following three statements:

1) The funds are responsible for the adequacy and accuracy of the disclosure in the filings.

2) Staff comments or changes to disclosure in response to Staff comments in the filings reviewed by the Staff do not foreclose the Commission from taking any action with respect to the filing.

3) The funds may not assert Staff comments as a defense in any proceeding initiated by the Commission or any other person under the Federal Securities Laws.

R: We affirm the aforementioned statements.