Asset Allocation Funds

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Asset Allocation Funds Fundamentals for Investors Building and maintaining a properly diversified investment portfolio in today’s dynamic market environment can be overwhelming for even seasoned investors.

Today more than ever, a one-stop approach to portfolio diversification may be your best choice.

Not FDIC Insured • May Lose Value • No Bank Guarantee Diversify by Investing Across Asset Classes

Effective diversification often means owning a number of different funds, each of which focuses on a different asset class. But that method, which requires investors to choose their own funds and then monitor and adjust the mix over time, may not be for everyone. • Some people don’t have the time. • Other investors may not feel they have the expertise. • Some simply don’t want to have to worry about it.

If one of these descriptions sounds familiar, please consult with your advisor to see if an asset allocation fund may make sense for you.

No single investment principle has a greater impact on portfolio performance than allocation among different asset classes. More Than More Than

90% 90% While asset allocation does not ensure a profit or guarantee against a loss, academic research has shown that asset allocation is responsible for more than 90% of a portfolio’s return variability over time.1

More Than 90%

Diversification does not ensure a profit or guarantee against a loss.

1 A Single-Fund Approach Can Make Diversification Easy

An asset allocation fund that offers exposure to a mix of different types of assets can help reduce the impact of market volatility, provide a potential source of income, and offer the potential for capital appreciation. Remember, diversification does not ensure a profit or guarantee against loss.

Reasons to consider asset allocation funds

An asset allocation Asset allocation Experienced portfolio Regular rebalancing fund offers a complete funds simplify the task managers relieve you by the managers helps portfolio in a single of monitoring your of having to select keep your portfolio investment. investments. investments and combine on track, regardless them in appropriate ways of market activity. to help meet your goals.

One-stop approach for diversification and risk management

2 Why Diversification Matters

The chart below shows annual performance for various asset classes from 2008 to 2020. As you can see, the market is seldom static. Performance leadership rotates from year to year as market dynamics change. Historically, downturns in one investment class have been tempered or even offset by favorable returns in another. For example, when stock prices were plummeting in 2008, a bond allocation within a diversified portfolio helped to offset declining returns in the equity market.

ANNUAL RETURNS OF KEY INDICES VARY FROM YEAR TO YEAR, 2008–2020

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

BBgBarc U.S. S&P Russell BBgBarc U.S. Russell Russell S&P Russell Russell Russell BBgBarc U.S. Russell Russell Aggregate MidCap 2000 Aggregate 2000 2000 500 Top 200 2000 Top 200 Aggregate Top 200 Top 200 Bond 400 Growth Bond Value Growth Index Growth Value Growth Bond Growth Growth 5.24% 37.38% 29.09% 7.84% 18.05% 43.30% 13.69% 8.18% 31.74% 31.92% 0.01% 36.48% 39.34%

Russell Russell Russell Russell S&P Russell Russell S&P Russell MSCI Russell S&P Russell 2000 2000 2000 Top 200 MidCap 2000 Top 200 500 2000 EAFE Top 200 500 2000 Value Growth Index Growth 400 Index Growth Index Index Index Growth Index Growth -28.92% 34.47% 26.85% 4.63% 17.88% 38.82% 13.57% 1.38% 21.31% 25.29% -0.52% 31.49% 34.63%

Russell S&P S&P MSCI Russell Russell BBgBarc U.S. S&P Russell S&P Russell Russell Diversified Top 200 MidCap 500 EAFE 2000 Top 200 Aggregate MidCap 2000 500 2000 2000 Portfolio Growth 400 Index Index Value Value Bond 400 Growth Index Growth Index -31.63% 34.01% 26.64% 2.11% 17.48% 34.52% 12.94% 0.55% 20.74% 22.17% -4.38% 28.48% 19.96%

Russell MSCI Russell Russell Russell S&P S&P MSCI Russell S&P Russell Russell S&P 2000 EAFE 2000 Top 200 Top 200 MidCap MidCap EAFE Top 200 500 Top 200 Top 200 500 Index Index Value Value Value 400 400 Index Value Index Value Value Index -33.79% 31.99% 24.50% 1.12% 17.01% 33.50% 9.77% -0.67% 16.20% 21.83% -6.22% 26.36% 18.40%

Russell Russell Russell Russell S&P Diversified Diversified Diversified Diversified Diversified Diversified Diversified Diversified Top 200 2000 2000 Top 200 MidCap Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Growth Index Index Growth 400 -36.06% 27.17% 17.94% -1.18% 16.35% 32.66% 7.32% -1.05% 13.79% 17.48% -7.66% 26.20% 16.42%

Russell S&P S&P S&P S&P S&P BBgBarc U.S. Russell S&P S&P Russell Russell S&P Top 200 500 500 MidCap 500 500 Aggregate 2000 500 MidCap 2000 2000 MidCap Value Index Index 400 Index Index Bond Growth Index 400 Growth Index 400 -36.09% 26.46% 15.06% -1.73% 16.00% 32.39% 5.97% -1.38% 11.96% 16.24% -9.31% 25.52% 13.66%

S&P Russell Russell Russell Russell S&P Russell Russell Russell MSCI Diversified Diversified Diversified MidCap Top 200 2000 Top 200 2000 MidCap 2000 2000 2000 EAFE Portfolio Portfolio Portfolio 400 Growth Growth Value Growth 400 Growth Index Index Index -36.23% 25.84% 13.21% -2.91% 15.18% 32.14% 5.60% -2.18% 11.32% 14.65% -11.01% 25.33% 8.02%

S&P Russell Russell Russell Russell Russell Russell Russell Russell S&P Russell BBgBarc U.S. Diversified 500 2000 Top 200 2000 Top 200 2000 Top 200 Top 200 Top 200 MidCap 2000 Aggregate Portfolio Index Value Value Index Growth Index Value Growth Value 400 Value Bond -37.00% 20.58% 11.69% -4.18% 15.06% 29.80% 4.89% -3.41% 6.95% 13.83% -11.08% 22.39% 7.51%

Russell Russell MSCI Russell Russell MSCI Russell Russell BBgBarc U.S. Russell Russell MSCI Russell 2000 Top 200 EAFE 2000 2000 EAFE 2000 2000 Aggregate 2000 2000 EAFE 2000 Growth Value Index Value Growth Index Value Index Bond Value Value Index Value -38.54% 14.59% 7.88% -5.50% 14.59% 22.92% 4.22% -4.41% 2.65% 7.84% -12.86% 22.29% 4.63%

MSCI BBgBarc U.S. BBgBarc U.S. MSCI BBgBarc U.S. BBgBarc U.S. MSCI Russell MSCI BBgBarc U.S. MSCI BBgBarc U.S. Russell EAFE Aggregate Aggregate EAFE Aggregate Aggregate EAFE 2000 EAFE Aggregate EAFE Aggregate Top 200 Index Bond Bond Index Bond Bond Index Value Index Bond Index Bond Value -43.25% 5.93% 6.54% -12.04% 4.21% -2.02% -4.77% -7.47% 1.21% 3.54% -13.60% 8.72% 1.64%

S&P 500® Index Russell Top 200 Value Index Russell 2000 Growth Index Diversified Portfolio represents U.S. equities represents U.S. represents U.S. small cap (composed of equal large cap value equities growth equities allocations to each index) S&P MidCap 400® Index represents U.S. Russell 2000® Index MSCI® EAFE® Index represents Please see last page for index mid cap equities represents U.S. non-U.S. developed-market descriptions and definitions. small cap equities equities Russell Top 200® Growth Index represents U.S. Russell 2000 Value Index Bloomberg Barclays U.S. large cap growth equities represents U.S. small cap Aggregate Bond Index value equities represents U.S. investment- grade bonds Past performance is no guarantee of future results. It is not possible to invest directly in an index. All market indices are unmanaged. Not intended to represent the performance of any Fidelity fund.

3 Consider Your Options Balanced Funds—Designed to Provide Modest Growth and Below-Average Risk

Balanced funds own both stocks and bonds and may be a smart choice for investors who are looking for a mixture of safety, income, and modest capital appreciation. They earn the “balanced” moniker by keeping the balance between the two asset classes pretty steady, usually placing about 60% of their assets in stocks and 40% in bonds.

Historically, a 60/40 portfolio mix of stocks and bonds has provided higher returns than bonds alone, and with less risk than a portfolio of only stocks as the chart below shows.

COMPARE RISK (VOLATILITY) AND RETURN FOR VARIOUS PORTFOLIOS, 1926 – 2021

Annualized Average Return (%) Standard Deviation (%)

12 25

10.4% 10 20 8.7% Standard Deviation (%) 8 18.6% 15

6 5.3%

11.6% 10 4 Annualized Return Total (%) 5 2 4.4%

0 0 100% Investment- 60% Stocks 100% S&P 500® Grade Bonds 40% Bonds

Diversification does not ensure a profit or guarantee against a loss. Past performance is no guarantee of future results. It is not possible to invest directly in an index. All indexes are unmanaged. Asset class total returns are represented by indexes from the following sources: Fidelity Investments and Bloomberg Barclays. Fidelity Investments source: a proprietary analysis of historical asset class performance, which is not indicative of future performance. Risk (volatility): represented by standard deviation, which measures the historical volatility of a fund. The greater the standard deviation, the greater the fund’s volatility. Bond returns are represented by the performance of the Bloomberg Barclays Aggregate Bond Index from January 1976 and by a composite of the IA SBBI Intermediate-Term Government Bond Index (67%) and the IA SBBI Long-Term Corporate Bond Index (33%) from January 1926 through December 1975. Source: Morningstar Direct, as of 6/30/21. Past performance is no guarantee of future results. It is not possible to invest directly in an index. All market indices are unmanaged. Not intended to represent the performance of any Fidelity fund. Please see last page for index descriptions and definitions.

4 Target Date Funds—Designed to Take the Guesswork Out of Saving for Retirement

Target date funds invest in a combination of stocks, bonds, and cash. They are designed to consider your whole life and adjust the asset allocation over time to become more conservative as you approach your retirement date.

Simply choose the target date fund that most closely matches the year in which you expect to retire. The fund takes care of the rest and balances retirement goals with investment risks at each point along your investment horizon.

A TARGET DATE FUND’S ASSET ALLOCATION OVER TIME*

Investor Age 25 45 60 75

Strategy High equity High equity Gradually decreasing equity Increased allocation to more allocation to allocation allocation with increased conservative fixed income and build wealth to continue fixed income and short-term short-term securities to provide building allocations to address need income and help protect against wealth for less risky assets a potential market decline 100 BONDS SHORTTERM DEBT

80

NONU.S. EQUITY

60

Allocation (%) Allocation 40

U.S. EQUITY

20

0 50 45 40 35 30 25 20 15 10 5 0 5 10 15 20 25 Years to Retirement Years in Retirement

* Asset allocation graphic is representative of the asset allocation strategy (glide path) for Fidelity Advisor Freedom® Funds. The glide path depicted represents an updated asset allocation strategy, with the transition expected to be completed by Q3 2022. Please consult your advisor for more information on the Fidelity Advisor Freedom Funds. The Adviser may use an active asset allocation strategy to increase or decrease neutral asset class exposures reflected above by up to 10 percentage points for equity funds (includes domestic and international equity funds), bond funds, and short-term funds to reflect the Adviser’s market outlook, which is primarily focused on the intermediate term. The asset allocations in the target allocation chart above are referred to as “neutral” because they do not reflect any decisions made by the Adviser to overweight or underweight an asset class.

5 Target Allocation Funds—Designed to Maintain a Specific Asset Allocation and Risk Level

Target allocation funds are managed very differently from target date funds. Target date funds’ asset allocations are continually shifting to become more conservative in response to an investor’s changing time horizon, while target allocation funds are managed to keep their asset allocation constant. Here are some examples of target allocation strategies:†

Appreciation Strategy Balance Strategy Preservation Strategy Maintains an equity allocation of Maintains an equity allocation of Maintains an equity allocation of around 85% and may be appropriate around 50% and may be appropriate around 20% and may be appropriate for risk-tolerant clients with a long for clients seeking income and for risk-averse clients seeking time horizon seeking to build wealth. looking to continue building wealth. income.

10% 15% 10% 15% 10% 15% 30% 30% 30%

20% 40% 50% 85%20% 40% 50% 85% 20% 40% 50% 85%

50% 50% 50%

Risk-Tolerant Risk-Averse

■ Stocks ■ Bonds ■ Short-Term/Money-Market Instruments

A target allocation fund manager will continually make adjustments to the portfolio on an as-needed basis to maintain a specific asset allocation. These funds may be a good option for investors who understand their tolerance for risk and how that translates into an asset allocation.

It’s important to remember, though, that the right asset allocation today may not necessarily be the right one tomorrow. As your time horizon changes, you should continually evaluate your investments, with the help of your advisor, to make sure your asset allocation matches your investment objectives.

† The target allocation strategies depicted are representative of neutral asset allocations for Fidelity Advisor Asset Manager® 85%, Fidelity Advisor Asset Manager® 50%, and Fidelity Advisor Asset Manager® 20% Funds. Please consult your advisor for more information on the Fidelity Advisor Freedom Funds.

6 Income and Real Return Funds—Designed to Address Key Income Needs

There are multi-asset-class strategies that are structured to provide bond income from global sources, non- bond income from dividend-paying securities, and real return from investments that help protect against inflation.

They strive to meet these objectives by investing in a diversified mix of fixed income and/or equity investments that managers choose for their historical combined performance. Here are some examples of what these strategies might look like.‡

5% Bond Income Strategy 15% ■ High-Yield Bonds ■ U.S. Government and Investment-Grade Debt 40% ■ Foreign Developed-Market Debt 15% ■ Emerging-Market Debt ■ Floating Rate Debt 25%

15% Non-Bond Income Strategy ■ Dividend-Paying Equities ■ 15% Prefered Stocks 50% ■ Convertible Securities ■ Real Estate Investment Trusts 20%

8% ■ Inflation-Protected Bonds Inflation Protection Strategy 12% 30% ■ Floating Rate Debt ■ Commodities ■ 25% REITs ■ 25% Real Estate Income

‡ The income and real return strategies depicted are representative of strategic allocations for Fidelity Advisor Strategic Income, Fidelity Advisor Strategic Dividend & Income,® and Fidelity Advisor Strategic Real Return Funds. Please consult your advisor for more information on the Fidelity Advisor Freedom Funds.

7 Steadfast Commitment to Research

Fidelity has been managing multi-asset class portfolios since 1996. We have an investment management group that is focused solely on the asset allocation segment of our fund lineup. It includes dedicated investment professionals, and experts in global economic analysis as well as asset allocation.

In addition, the team is supported by the world-class research and portfolio management skills of over 350 research professionals located around the globe.#

Ask your advisor about investing in Fidelity Advisor Funds today.

# Fidelity Investments as of 6/30/2021. Data is unaudited. These figures reflect the resources of Fidelity Management & Research Company a U.S. company, and its subsidiaries. Research professionals include both analysts and associates.

8 Fidelity Advisor Asset Allocation Funds

Class I Class Z Class Z6 Class I Class Z Target Date Target-Risk Fidelity Advisor Freedom® 2005 FFIVX FIJHX FYGLX Fidelity Advisor Asset Manager® 20%^ FTIWX FIKVX Fidelity Advisor Freedom® 2010 FCIFX FIJJX FUGLX Fidelity Advisor Asset Manager® 30%^ FTINX FIKWX Fidelity Advisor Freedom® 2015 FFVIX FIJKX FIGLX Fidelity Advisor Asset Manager® 40%^ FFNIX FIKYX Fidelity Advisor Freedom® 2020 FDIFX FIJLX FOGLX Fidelity Advisor Asset Manager® 50%^ FFIMX FIKZX Fidelity Advisor Freedom® 2025 FITWX FIJMX FPGLX Fidelity Advisor Asset Manager® 60%^ FSNIX FIQAX Fidelity Advisor Freedom® 2030 FEFIX FIJNX FDGLX Fidelity Advisor Asset Manager® 70%^ FAAIX FIQBX Fidelity Advisor Freedom® 2035 FITHX FIJOX FHGLX Fidelity Advisor Asset Manager® 85%^ FEYIX FIQCX Fidelity Advisor Freedom® 2040 FIFFX FIJPX FKGLX Income & Real Return Fidelity Advisor Freedom® 2045 FFFIX FIJQX FCGLX Fidelity Advisor Multi-Asset Income Fund FAYZX FIWBX Fidelity Advisor Freedom® 2050 FFFPX FIJRX FVGLX Fidelity Advisor Strategic Income FSRIX FIWDX ® Fidelity Advisor Strategic Dividend & Fidelity Advisor Freedom 2055 FHFIX FIJSX FBGLX FSIDX FIQWX Income®^ Fidelity Advisor Freedom® 2060 FDKQX FIJTX FNGLX Fidelity Advisor Strategic Real Return^ FSIRX FIQDX Fidelity Advisor Freedom® 2065 FDFSX FDFQX FDFRX Balanced Fidelity Advisor Freedom® Income FIAFX FIJUX FEGLX Fidelity Advisor Balanced FAIOX FZAAX Fidelity Advisor Freedom® Blend 2005^ FHADX FHACX FHJHX Fidelity Advisor Freedom® Blend 2010^ FJAWX FJAVX FHZCX Fidelity Advisor Freedom® Blend 2015^ FJAQX FJAPX FHXCX Fidelity Advisor Freedom® Blend 2020^ FJAJX FJAIX FHWCX Fidelity Advisor Freedom® Blend 2025^ FJADX FJABX FHSPX Fidelity Advisor Freedom® Blend 2030^ FJEFX FJLMX FHRCX Fidelity Advisor Freedom® Blend 2035^ FHGDX FHSDX FHQCX Fidelity Advisor Freedom® Blend 2040^ FHJFX FHHFX FHOCX Fidelity Advisor Freedom® Blend 2045^ FHCFX FHBFX FHLCX Fidelity Advisor Freedom® Blend 2050^ FHWEX FHVEX FHJCX Fidelity Advisor Freedom® Blend 2055^ FHQEX FHPEX FHGCX Fidelity Advisor Freedom® Blend 2060^ FHKEX FHJEX FHDCX Fidelity Advisor Freedom® Blend 2065^ FAXFX FAXGX FAXHX Fidelity Advisor Freedom® Blend Income^ FHAJX FHAHX FHBDX

^ Class Z, Z6 and I are classes of their respective Fidelity retail Fund. i.fidelity.com

Information provided in this document is for informational and educational purposes only. To the extent any investment information in this material is deemed to be a recommendation, it is not meant to be impartial investment advice or advice in a fiduciary capacity and is not intended to be used as a primary basis for you or your client’s investment decisions. Fidelity and its representatives may have a conflict of interest in the products or services mentioned in this material because they have a financial interest in them, and receive compensation, directly or indirectly, in connection with the management, distribution, and/or servicing of these products or services, including Fidelity funds, certain third-party funds and products, and certain investment services. The investment risk of each Fidelity Advisor Freedom Fund changes over time as its asset allocation changes. These risks are subject to the asset allocation decisions of the Investment Adviser. Pursuant to the Adviser’s ability to use an active asset allocation strategy, investors may be subject to a different risk profile compared to the fund’s neutral asset allocation strategy shown in its glide path. The funds are subject to the volatility of the financial markets, including that of equity and fixed income investments in the U.S. and abroad, and may be subject to risks associated with investing in high-yield, small cap, commodity-linked, and foreign securities. Leverage can increase market exposure, magnify investment risks, and cause losses to be realized more quickly. No target date fund is considered a complete retirement program and there is no guarantee any single fund will provide sufficient retirement income at or through retirement. Principal invested is not guaranteed at any time, including at or after the funds’ target dates. In general, the bond market is volatile, and fixed income securities carry interest rate risk. As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities. Fixed income securities also carry inflation, credit, and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so holding them until maturity to avoid losses caused by price volatility is not possible. • Stock markets, especially foreign markets, are volatile and can decline significantly in response to adverse issuer, political, regulatory, market, or economic developments. Foreign securities are subject to interest rate, currency exchange rate, economic, and political risk. • Leverage can increase market exposure and magnify investment risk. • Lower-quality bonds can be more volatile and have greater risk of default than higher-quality bonds. • Floating rate loans may not be fully collateralized and therefore may decline significantly in value. Moreover, they may be subject to restrictions on resale and sometimes trade infrequently in the secondary market; as a result they may be more difficult to value, buy, or sell. If the fund’s asset allocation strategy does not work as intended, the fund may not achieve its objective. 1 Gary P. Brinson, L. Rudolph Hood, and Gilbert L. Beebower, 1986, “Determinants of Portfolio Performance,” Financial Analysts Journal vol. 42 (4), July/August pages 39–44 (reprint, 1995, Financial Analysts Journal 51 (1), pages 133–138, 50th Anniversary Issue). Gary P. Brinson, Brian D. Singer, and Gilbert L. Beebower, 1991, “Determinants of Portfolio Performance II: An Update,” Financial Analysts Journal vol. 47 (3), pages 40–48; Roger G. Ibbotson and Paul D. Kaplan, 2000, “Does Asset Allocation Policy Explain 40, 90, or 100 Percent of Performance?”, Financial Analysts Journal vol. 56 (1), pages 26–33. S&P 500 Index is a market capitalization-weighted index of 500 common stocks chosen for market size, liquidity, and industry group representation to represent U.S. equity performance. S&P MidCap 400 Index is a market capitalization-weighted index of 400 mid cap stocks of U.S. companies chosen for market size, liquidity, and industry group representation. Russell Top 200 Index is a market capitalization-weighted index designed to measure the performance of the largest cap segment of the U.S. equity market. Russell Top 200 Growth Index measures the performance of those Russell Top 200 companies with higher price-to-book ratios and higher forecasted growth values. Russell Top 200 Value Index measures the performance of those Russell Top 200 companies with lower price-to-book ratios and lower forecasted growth values. Russell 2000 Index is a market capitalization-weighted index designed to measure the performance of the small cap segment of the U.S. equity market. It includes approximately 2,000 of the smallest securities in the Russell 3000® Index. Russell 2000 Value Index is a market capitalization-weighted index designed to measure the performance of the small cap value segment of the U.S. equity market. It includes those Russell 2000 Index companies with lower price-to-book ratios and lower forecasted growth rates. Russell 2000 Growth Index is a market capitalization-weighted index designed to measure the performance of the small cap growth segment of the U.S. equity market. It includes those Russell 2000 Index companies with higher price-to-book ratios and higher forecasted growth rates. MSCI EAFE Index is a market capitalization-weighted index that is designed to measure the investable equity market performance for global investors in developed markets, excluding the U.S. and Canada. Bloomberg Barclays U.S. Aggregate Bond Index is a broad-based, market value-weighted benchmark that measures the performance of the investment-grade, U.S. dollar-denominated, fixed-rate taxable bond market. Sectors in the index include Treasuries, government-related and corporate securities, MBS (agency fixed-rate and hybrid ARM pass-throughs), ABS, and CMBS.IA SBBI U.S. Intermediate-Term Government Bond Index is an unweighted index that measures the performance of five-year maturity U.S. Treasury bonds. Each year, a one-bond portfolio containing the shortest non-callable bond having a maturity of not less than five years is constructed.IA SBBI U.S. Long-Term Corporate Bond Index is a custom index designed to measure the performance of long-term U.S. corporate bonds. All market indices are unmanaged. It is not possible to invest directly in an index. • Investment decisions should be based on an individual’s own goals, time horizon, and tolerance for risk. Not NCUA or NCUSIF insured. May lose value. No credit union guarantee. Third-party trademarks and service marks are the property of their respective owners. All other trademarks and service marks are the property of FMR LLC or an affiliated company. Before investing, consider the funds’ investment objectives, risks, charges, and expenses. Consult your investment professional or visit institutional.fidelity.com for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

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