In sharp contrast to UTI's monthly income plans, Alliance has decidedagainst giving any assured returns to investors in its monthly incomescheme. The fund, expected to open for subscription on May 24, will beavailable on a no-load basis.

According to industry analysts, this is a major step forward for theAlliance Capital AMC. `As of the present situation in the MF industry, themonthly income schemes (MIPs) from the UTI stable will almost definitely beforced to abandon guaranteed returns. Once that happens, a couple of yearsdown the line, the early goers like Alliance MF will attract a lot ofinvestment' said a mutual fund analyst.

In the dividend option, the investors can opt to receive the dividendpayments either on a monthly or on a quarterly basis. As the Budget hasalready been passed by the Parliament, the dividend with the investors willbe tax exempt.

According to the MF analyst, the latest offering from Alliance MF is beingpositioned to attract investors who seek regular income from fixed incomeinstruments. The scheme will be investing 85 per cent of the total corpus indebt instruments and the balance 15 per cent in equity.

The move also augurs well for Alliance AMC. Once UTI's guranteed monthlyincome plans are forced to follow the path that SBI's Magnum monthly incomeplans and LIC's Dhanvarsha's took, the Alliance AMC will be strategicallypositioned to claim themselves as the front-runners in this segment of theindustry. By virtue of their experience in the segment, in themedium-to-long term, they can attract a lot of investments for such schemes,says the analyst.