According to KN Atmaramani, managing director, Tata Mutual Fund, ``It will be a three-year close-ended fund with liquidity option after one year".This is one of the first schemes from the private sector to give monthly dividends. Only public sector mutual funds are known to have popular monthly income plans and the UTI holds a big chunk of this market. Apart from this, the mutual fund also plans to get into retirement plans in future.

These type of funds, popularly known as the 401k plans in the US are known to have many takers. As there are not many sources of regular income for the retired in India, apart from the public provident funds, the fund management feels that this is a big market to enter into. The Tata Mutual Fund is also the first private sector mutual fund to launch a balance fund which was named as "Tata Equity Fund".

The fund was launched in 1995 and the prospectus itself had declared that the fund will invest 60 per cent in equity and 40 per cent in debt. The latest dividend declared by the scheme is 12.5 per cent and the NAV of the scheme is Rs 17.

The Tata Tax saving fund has declared 20 per cent dividend payable on January 15, 2000. With the previous dividend of 20 per cent paid on June 15, 1999, the total dividend of the scheme works out to 40 per cent within a span of one year.