• What is the Auto Roll Program?
• What are the limitations?
• Subscribing to Auto Roll Program
• What is the process that Fidelity employs?
• How does Fidelity communicate with me about Auto Roll purchases?
• Benefits
• Risks

What is the Auto Roll Program?

Program Overview

In order to take advantage of and participate in the Auto Roll Program, you will need to complete a brief a one–time subscription process. The Subscriber Agreement details the benefits, risks and limitations of the Program.

Subscribing to the Auto Roll Program provides customers with the ability to purchase certain eligible: 1) U.S. Department of the Treasury auction securities (“Treasury”) and/or 2) New Issue FDIC–Insured Certificates of Deposit (“CDs”) and have the proceeds of the principal of these securities at maturity automatically be used to purchase a similar auction/new issue instrument. This Auto Roll feature will continue to purchase a new security at the maturity of the older security unless the customer cancels the feature for that security, there is a material change to the Treasury auction schedule or Fidelity is unable to find a replacement new issue CD that meets the initial size, duration and coupon frequency criteria of the maturing security.

What are the limitations?

The Auto Roll Program is available for certain Treasury auction securities or new issue FDIC-Insured CDs purchased through Fidelity.com with a term to maturity of 5 years or less. The following securities are ineligible for the Program: i) Treasury Inflation Indexed securities (“TIPs”); ii) any inflation indexed CDs (“CDIPs” or “IFCDs”); iii) callable CDs; iv) floating and adjustable rate CDs v) CD purchases exceeding $100,000. All other fixed income instruments and all secondary Treasury or CD securities are also ineligible. The auto–roll feature for CD purchases in retirement accounts is not available.

Subscribing to Auto Roll Program

How do I enroll in the AutoRoll Program?

The Auto Roll Program allows customers to sign up all or some eligible Fidelity accounts in a simple one–time process. Once customers have agreed to the Auto Roll Program Authorization agreement and subscribed to the Fidelity Alerts Service, on future eligible fixed income transactions, they need only click “yes” to the Auto Roll option displayed on the order entry screen to take advantage of this convenient feature.

View detailed instructions and helpful images.

All Fidelity brokerage including retirement accounts may enroll in the Auto Roll Program. Open an account.

What is the process that Fidelity employs?

For detailed Treasury Auction and New Issue CD methodology, click here.

How does Fidelity communicate with me about Auto Roll purchases?

In order to communicate with customers on an ongoing basis about Treasury and CD securities containing the Auto Roll feature, Fidelity requires participants in the Auto Roll Program to enroll in Fidelity’s Alerts Subscription Service. As part of the Auto Roll feature, Fidelity sends out periodic alerts to remind its customers about their participation in the Auto Roll Program and to notify them of subsequent Auto Roll security purchases that will be selected based on the criteria described above. Once established, cancellation of the Auto Roll Alerts Subscription Service will result in the cancellation of the Auto Roll feature for all securities in that account.

Fidelity provides its customers participating in the Auto Roll Program with the following alerts:

• Welcome Alert — welcomes customers to the Auto Roll Program and provides instructions for cancellation of Auto Roll feature on Auto Roll positions. This alert will be sent to you at the time of your enrollment in the program.
• Maturing Security Alert — provides customers with details of the security to be purchased with the proceeds of the maturing security in the Auto Roll Program. With this alert, on CD purchases, customers are given both the day of the alert transmission and the following day to consider the purchase of this selected security or to cancel the purchase. Cancellation instructions are included within the alert. This may be the only communication that Fidelity sends you with regard to the Auto Roll feature. You should therefore make sure that your e–mail address is up to date and watch for the Maturing Security Alert just prior to the security’s maturity date. In some circumstances, a CD might post to a customer’s account within the purchase/cancel consideration period. In these cases, Fidelity will honor a customer’s cancellation request if the customer contacts a Fidelity representative at 1 (800) 544–5372 and makes such a request within the stated time limitation outlined just above.
• Reminder Alert — this alert reminds customers who own Auto Roll securities having a term to maturity of 13 months or longer of their participation in the Auto Roll Program. This alert is sent approximately 1 month prior to maturity. Cancellation instructions are also included within the alert.
• No Security Identified Alert — this alert notifies customers that Fidelity has been unable to find a replacement Auto Roll security meeting their size, term to maturity and/or coupon frequency criteria. It will be sent approximately 3 business days after maturity date should Fidelity be unable to find a replacement CD.

Within Auto Roll, what are all of my cancellation options?

• Customers may cancel participation in the Auto Roll feature for a specific security at any time by contacting a Fidelity Fixed Income Specialist at 1 (800) 544–5372 and providing the CUSIP of the Auto Roll security.
• The Maturing Security Alert provides customers with an online option near maturity to cancel the Auto Roll feature for a specific CUSIP/security.
• Customers have the ability to cancel all Auto Roll positions in a given account at one time by unsubscribing to ALL Auto Roll alerts for that account. To unsubscribe, go to Research>Alerts>Fixed Income>Auto Roll Alert, click the “delete” link and follow the steps to complete the request. If, within an account, Auto Roll alerts have been set up with multiple Social Security Numbers (SSNs) or customer IDs (e.g., joint accounts, authorized users, etc.), it is necessary to unsubscribe from ALL SSNs or customer IDs within that account in order to cancel the re–investment feature on existing fixed income positions in that account. Upon deletion of every Auto Roll alert, the Auto Roll feature will be removed on every Auto Roll position within that account. Please note: any future purchase of a fixed income security under the Auto Roll program will require re–enrollment.

Benefits

• Set it and forget it. You make the choice of the initial instrument, the purchase amount, its maturity and coupon frequency. Then, Fidelity will help you keep invested on your chosen criteria once the bond or CD matures
• Consistent portfolio allocation. When bonds and CDs mature, your bond portfolio allocation may be changing. Using the Auto Roll feature helps keep you properly allocated at a level of your choosing.
• You remain in control. With the alerts and the facility to exit the Auto Roll program at any time, you remain in total control and there is no penalty for any cancellation of the Auto Roll Program. Early withdrawal from a fixed income security may be subject to an early withdrawal penalty from the issuer.

Risks

• Although Fidelity provides an account–level FDIC check for any CD Auto Roll transactions to check against exceeding FDIC Insurance CD coverage limits, the check is account–specific.

• Although with U.S. Treasuries securities the issuer is always the U.S. government, with CDs the bank issuing the subsequent security is likely not to be the same bank which issued the original security (see “What is the process that Fidelity employs?” link above for details).
• Default risk. U.S. Treasuries are backed by the full faith & credit of the U.S. Government. CDs (along with the total of all other assets, other than the CD, held at that bank) are protected up to FDIC limits. For more information, please visit the FDIC website at www.fdic.gov.
• Bank Failure Liquidity Risk. If you invest in a CD from a bank that fails, your principal and accrued interest (along with the total of all other assets, other than the CD, held at that bank) are protected up to FDIC coverage limits, as long as your CD investment or investments with the bank and any other financial services firms do not exceed the coverage limits, but you may face a wait to receive your money.
• General Liquidity Risk. The secondary market in CDs may be limited. Accordingly, investors attempting to sell CDs may experience limited liquidity which in turn may adversely affect the selling price of the CD.
• Interest rate risk. The Auto Roll Program is designed for the situation in which you hold the bond/CD until maturity. Subsequent security purchases through the Auto Roll Program will reflect the yield curve / market rates prevailing at the time of purchase and these rates may be less (or greater) than those of your original security purchase. As a general matter, if interest rates rise, the market price of outstanding CDs will decline. However, since changes in interest rates will have the most effect on longer maturities, short-term CDs are generally less susceptible to interest rate movements.
• Inflation Risk. The rate of the yield, either to call or to maturity of the investment, may not provide a positive return over the rate of inflation for the period of the investment.
• Credit risk. Since CDs are a debt instrument, there is credit risk associated with their purchase. The insurance offered by the FDIC may help mitigate this risk. Fidelity makes no judgment as to the creditworthiness of the issuing institution and does not endorse or recommend the CDs in any way. Go the www.fdic.gov to learn more about FDIC insurance coverage and about the availability of Bank Rating Services.
• Selling before maturity. CDs sold prior to maturity are subject to a concession and may be subject to a substantial gain or loss due to interest rate changes.