Fidelity Magellan Fund reopens to new investors

For 45 years, Fidelity Magellan Fund, a well-known name in mutual fund history, has helped millions of Americans reach their financial goals. On January 15, for the first time in 10 years, the fund will open to new investors.

"Magellan is arguably the most well-known name in the history of mutual funds and has a long history of making money for its shareholders," says Walter C. Donovan, president, Equity Division, Fidelity Management & Research Company. "Millions of Americans have relied upon the fund to help them reach financial goals such as saving for college, buying a new home, or retirement. We believe that the time is right to make Magellan® available to a new generation of investors."

Donovan explains why it is in the interests of Magellan® Fund shareholders to reopen the fund: "Having been closed for more than a decade, Magellan's shareholder base has matured and, in the normal course of investing, many shareholders have continued to redeem assets as they've met their financial goals. In fact, 85% of the fund's assets are earmarked for retirement, and the Baby Boomer generation has now begun to retire and tap those dollars," he says. "We believe that generating new sales to offset future redemptions will help stabilize the fund's cash flows and assist fund manager Harry Lange in most effectively directing investment strategies for the benefit of fund shareholders. It's effectively the inverse of the reason why we limited new purchases of the fund 10 years ago. At that time, we were seeing strengthening cash inflows, and we expected that trend to continue."

Magellan Fund Manager Harry Lange, a 25-year Fidelity veteran agrees.

"I strongly believe that reopening the fund is the right step for Magellan's shareholders at this time," says Lange. "As Magellan® always has had a flexible investment mandate, I'm very comfortable with the size of my investment universe, and -- thanks to the support I receive from Fidelity's analysts -- I've been fortunate to find great stocks here in the U.S. and abroad to include in the portfolio. In addition, I've always been most comfortable managing an equity fund when it has steady cash flows. If we're able to achieve a better balance of cash flows in the fund going forward, I'll regularly have the cash on hand to capitalize on attractive investment opportunities as I find them."

Since its inception, Magellan has been a solid performer. It returned an average of 18.4% since is inception in 19631; outperformed the S&P 500® over the last decade2; and has a 4-star overall Morningstar rating.* In addition, during his tenure as fund manager, Lange has delivered 33.8% returns vs. the S&P 500® benchmark of 27.71%.3

* The Overall Morningstar RatingTM for a fund is derived from a weighted average of the performance figures associated with its 3-, 5-, and 10-year (if applicable) Morningstar rating metrics as of 12/31/2007.

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Get returns, ranking information, risks, and fees for Magellan (FMAGX).

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Performance data shown represents past performance and is no guarantee of future results. Investment return and principal value will fluctuate, so you may have a gain or loss when shares are sold. Current performance may be higher or lower than that quoted. Visit Fidelity.com/performance for most recent month-end performance.

As with all your investments through Fidelity, you must make your own determination whether an investment in any particular security or securities is consistent with your investment objectives, risk tolerance, financial situation, and evaluation of the security. Fidelity is not recommending or endorsing this investment by making it available to its customers.

1. Start date of Magellan: May 2, 1963. End date for the 18.4% per year performance number is November 30, 2007.

2. Outperformed the S&P 500® over the last decade; Magellan performance = 6.31%, S&P 500® performance = 5.91%. Dates= December 31, 1997-December 31, 2007.

3. From October 31, 2005 to November 30, 2007.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus containing this information. Read it carefully.

Source: By Fidelity Investments