ALLIANCE QUASAR FUND
ANNUAL REPORT
SEPTEMBER 30, 1998
ALLIANCE CAPITAL
LETTER TO SHAREHOLDERS ALLIANCE QUASAR FUND
_______________________________________________________________________________
November 27, 1998
Dear Shareholder:
This annual report discusses Alliance Quasar Fund performance for the periods
ended September 30, 1998.
INVESTMENT RESULTS
The following table shows how your Fund performed for the six- and 12-month
periods ending September 30, 1998, based on the net asset value (NAV) of each
class of shares. For comparison, we have also shown the returns for the S&P 500
Stock Index and the Russell 2000 Index.
Your Fund's Class A shares posted a total return of -29.10% at NAV for the
six-month period ended September 30, 1998, underperforming the Fund's
benchmark, the Russell 2000 Index, which posted a -23.87% return. This
underperformance can be attributed to the Fund's overweighting in several
growth cyclical industries, particularly the airline and rental car industries,
relative to the benchmark. If the U.S. enters a recession in the next 12
months, many investors believe that these industries' earnings would be hurt
disproportionately. As a result, during the most recent small cap sell-off,
these stocks underperformed considerably. However, we believe that any economic
uncertainty is already priced into these stocks and they offer investors
tremendous opportunities given their strong fundamentals and low stock
valuations.
INVESTMENT RESULTS*
Periods Ended September 30, 1998
TOTAL RETURNS
6 MONTHS 12 MONTHS
---------- ---------
ALLIANCE QUASAR FUND
Class A -29.10% -23.45%
Class B -29.38% -24.03%
Class C -29.37% -24.05%
RUSSELL 2000 INDEX -23.87% -19.02%
S&P 500 STOCK INDEX -6.93% 9.08%
* THE FUND'S INVESTMENT RESULTS REPRESENT TOTAL RETURNS AND ARE BASED ON THE
NET ASSET VALUE OF EACH CLASS OF SHARES AS OF SEPTEMBER 30, 1998. TOTAL RETURNS
FOR ADVISOR CLASS SHARES WILL DIFFER DUE TO DIFFERENT EXPENSES ASSOCIATED WITH
THAT CLASS. ALL FEES AND EXPENSES RELATED TO THE OPERATION OF THE FUND HAVE
BEEN DEDUCTED, BUT NO ADJUSTMENT HAS BEEN MADE FOR SALES CHARGES THAT MAY APPLY
WHEN SHARES ARE PURCHASED OR REDEEMED. PAST PERFORMANCE IS NO GUARANTEE OF
FUTURE RESULTS.
THE S&P 500 STOCK INDEX IS AN UNMANAGED INDEX OF 500 U.S. COMPANIES AND IS A
COMMON MEASURE OF THE PERFORMANCE OF THE OVERALL U.S. STOCK MARKET. THE RUSSELL
2000 INDEX IS A CAPITALIZATION-WEIGHTED INDEX THAT INCLUDES 2,000 OF THE
SMALLEST STOCKS REPRESENTING APPROXIMATELY 11% OF THE U.S. EQUITY MARKET. AN
INVESTOR CANNOT INVEST DIRECTLY IN AN INDEX.
ADDITIONAL INVESTMENT RESULTS CAN BE FOUND ON PAGE 3.
REVIEW OF INVESTMENT STRATEGY
Our basic investment strategy remains unchanged. We continue to adjust the
Fund's portfolio composition to reflect our perception of those smaller, highly
competitive companies that will, in our judgment, exhibit long-term price
appreciation through superior earnings growth. During the last several months,
there has been a tremendous amount of volatility and nervousness in the
marketplace. We have not changed our style or strategy at all, but instead are
trying to take advantage of inefficiencies in the marketplace.
With the economy slowing, there is a belief that the U.S. may potentially enter
a recession. As you know, several of the overseas markets are already
experiencing recessionary times, and if the U.S. economy continues to slow,
there could be some downward pressure on the level of discretionary spending in
the U.S. With that as a backdrop, several of our growth names with a cyclical
or consumer orientation have not performed well during the last six months
because of the belief that the level of consumer spending in the U.S. will slow
down.
Specifically, our airline stocks and rental car stocks have done poorly. While
the fundamentals for both the airline and rental car industries are quite
strong, with both showing record pricing, and record profitability, these
stocks have given up all of their gains achieved over the last several years in
just the last few months. Nevertheless, within the airline industry, we
currently hold positions in Alaska Air Group, Inc., America West Holdings
Corp., and Mesa Air Group, Inc. Furthermore, within the rental car group, we
still hold positions in Budget Group, Inc. and Dollar Thrifty Automotive Group,
Inc. At less than 10 times earnings, we believe these companies should perform
well over the next several years.
1
ALLIANCE QUASAR FUND
_______________________________________________________________________________
On the consumer side, Bally Total Fitness Holding Corp., Men's Wearhouse, Inc.,
Premier Parks, Inc. and United Rentals, Inc. also have underperformed the
broader small cap market. However, we have strong conviction in each of these
companies and still believe they offer investors tremendous value.
In addition, companies with strong franchises and brand names such as Tiffany &
Co. and Tommy Hilfiger Corp. were also caught in this downward pressure in
retail stocks. Hence, with both companies growing their earnings at 20% + with
price to earnings (P/E) multiples at less than 12 times earnings, we believe
they offer investors a good value in a difficult retail environment.
On a positive note, the health care sector held up relatively well during the
small cap sell-off. The Fund still has a strong focus on late stage
biotechnology companies that have clearly demonstrated the ability to get
products through the Federal Drug Administration (FDA). Within the
biotechnology group, we currently hold positions in Centocor, Inc., GelTex
Pharmaceuticals, Inc., and MedImmune, Inc.
Within the REIT Sector, we continue to build positions in strong, well
capitalized REITs. Chelsea GCA Realty, Inc. is a leading operator of outlet
centers and Taubman Centers, Inc. is a leading operator of malls in the U.S. At
current valuations, these investments are yielding between 7-8% before capital
appreciation. We currently hold positions in both companies.
On the automotive side, we still continue to be encouraged by the consolidation
unfolding on the retail dealership side of the business. Manufacturers and
large scale retailers both want to consolidate the number of automobile
dealerships that currently exist in the United States. Eventually, a one-price
shopping experience should replace traditional haggling and this, coupled with
lower prices, should enrich the car buying experience the consumer has to face.
Both Group 1 Automotive, Inc. and Circuit City Stores, Inc.--CarMax Group
should be beneficiaries of this trend and we currently hold positions in both
companies.
We also continue to believe that the oil tanker industry will rebound within
the next several years, when tanker rates are forced upwards, older tanks are
retired, and new construction fails to keep up with demand. We continue to hold
positions in OMI Corp., Teekay Shipping Corp., and Knightsbridge Tankers, Ltd.
Lastly, the Fund has been weighted between 12% and 14% in the technology sector
over the last several months. Not having an aggressive weighting in this sector
actually helped us during the difficult period for small cap stocks. Going
forward, we are comfortable with a market weighting in technology focusing on
those companies with strong franchises with proprietary positions.
In summary, we cannot overemphasize how volatile and difficult the last several
months have been for small cap managers. While we are extremely proud of our
long term results, we are quite disappointed with short term results and feel
comfortable that we are very well positioned going forward. We continue to be
quite bullish on small cap stocks and believe the opportunity and valuations
for small cap stocks are extremely compelling relative to large cap stocks.
Hence, we believe we are very well positioned to participate in any small cap
rally.
Thank you for your continued interest in the Alliance Quasar Fund. We look
forward to reporting to you on future market activity and investment results.
Sincerely,
Alden M. Stewart
Chairman and President
Randall E. Haase
Senior Vice President
SHARES OF THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, GUARANTEED OR ENDORSED
BY, ANY BANK; FURTHER, SUCH SHARES ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY.
SHARES OF THE FUND INVOLVE INVESTMENT RISKS, INCLUDING THE POSSIBLE LOSS OF
PRINCIPAL.
2
INVESTMENT OBJECTIVE AND POLICIES ALLIANCE QUASAR FUND
_______________________________________________________________________________
Alliance Quasar Fund seeks growth of capital by pursuing aggressive investment
policies. Quasar Fund invests primarily in a diversified portfolio of equity
securities of any company and industry and in any type of security which is
believed to offer possibilities for capital appreciation.
INVESTMENT RESULTS
_______________________________________________________________________________
NAV AND SEC TOTAL RETURNS AS OF SEPTEMBER 30, 1998
CLASS A SHARES
WITHOUT WITH
SALES CHARGE SALES CHARGE
------------ ------------
One Year -23.45% -26.71%
Five Years 11.81% 10.85%
Ten Years 10.99% 10.51%
CLASS B SHARES
WITHOUT WITH
SALES CHARGE SALES CHARGE
------------ ------------
One Year -24.03% -26.93%
Five Years 10.94% 10.94%
Since Inception* 11.88% 11.88%
CLASS C SHARES
WITHOUT WITH
SALES CHARGE SALES CHARGE
------------ ------------
One Year -24.05% -24.77%
Five Years 10.94% 10.94%
Since Inception* 13.37% 13.37%
The Fund's investment results represent total returns. The NAV and SEC returns
reflect reinvestment of dividends and/or capital gains distributions in
additional shares without (NAV) and with (SEC) the effect of the 4.25% maximum
front-end sales charge for Class A shares or applicable contingent deferred
sales charge for Class B shares (4% year 1; 3% year 2; 2% year 3; 1% year 4);
and for Class C shares (1% year 1). Returns for Class A shares do not reflect
the imposition of the 1 year 1% contingent deferred sales charge for accounts
over $1,000,000. Total return for Advisor Class shares will differ due to
different expenses associated with that class.
Past performance does not guarantee future results. Investment returns and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than their original cost.
* Inception: 9/17/90, Class B; 5/3/93, Class C.
3
ALLIANCE QUASAR FUND
_______________________________________________________________________________
ALLIANCE QUASAR FUND
GROWTH OF A $10,000 INVESTMENT
9/30/88 TO 9/30/98
$48,000
$40,000
$32,000
$24,000
$16,000
$10,000
$8,000
S&P 500: $49,182
RUSSELL 2000 INDEX: $28,805
QUASAR FUND CLASS A: $27,158
9/30/88 9/30/89 9/30/90 9/30/91 9/30/92 9/30/93
9/30/94 9/30/95 9/30/96 9/30/97 9/30/98
This chart illustrates the total value of an assumed $10,000 investment in
Alliance Quasar Fund Class A shares (from 9/30/88 to 9/30/98) as compared to
the performance of appropriate broad-based indices. The chart reflects the
deduction of the maximum 4.25% sales charge from the initial $10,000 investment
in the Fund and assumes the reinvestment of dividends and capital gains.
Performance for Class B, Class C and Advisor Class shares will vary from the
results shown above due to differences in expenses charged to those classes.
Past performance is not indicative of future results, and is not representative
of future gain or loss in capital value or dividend income.
The unmanaged Standard & Poor's 500 Stock Index includes 500 U.S. stocks and is
a common measure of the performance of the overall U.S. stock market.
The unmanaged Russell 2000 Index measures small-cap stock performance.
When comparing Alliance Quasar Fund to the indices shown above, you should note
that no charges or expenses are reflected in the performance of the indices.
Quasar Fund
Standard &Poor's 500 Stock Index
Russell 2000 Index
4
TEN LARGEST HOLDINGS
SEPTEMBER 30, 1998 ALLIANCE QUASAR FUND
_______________________________________________________________________________
COMPANY VALUE PERCENT OF NET ASSETS
- -------------------------------------------------------------------------------
Budget Group, Inc. Cl.A $ 54,355,344 3.7%
Bethlehem Steel Corp. 51,117,825 3.5
Chelsea GCA Realty, Inc. 44,418,825 3.0
Alaska Air Group, Inc. 44,001,938 3.0
Mohawk Industries, Inc. 42,486,000 2.9
Centocor, Inc. 39,129,687 2.6
Century Business Services, Inc. 34,020,362 2.3
Premier Parks, Inc. 33,878,250 2.3
GelTex Pharmaceuticals, Inc. 32,788,113 2.2
Tiffany & Co. 31,848,762 2.1
$408,045,106 27.6%
MAJOR PORTFOLIO CHANGES
SIX MONTHS ENDED SEPTEMBER 30, 1998
_______________________________________________________________________________
SHARES
----------------------------------------
PURCHASES BOUGHT HOLDINGS 9/30/98
- -------------------------------------------------------------------------------
Alaska Air Group, Inc. 848,000 1,291,800
America West Holdings Corp. Cl.B 1,335,300 1,973,500
Bethlehem Steel Corp. 2,629,000 6,196,100
Budget Group, Inc. Cl.A 1,290,500 2,382,700
Centocor, Inc. 987,500 987,500
Men's Wearhouse, Inc. 763,250 763,250
Premier Parks, Inc. 1,675,600 1,935,900
Renaissance Worldwide, Inc. 1,270,000 1,270,000
Stage Stores, Inc. 1,273,700 1,273,700
Taubman Centers, Inc. 2,123,800 2,123,800
SALES SOLD HOLDINGS 9/30/98
- -------------------------------------------------------------------------------
Avis Rent A Car, Inc. 849,000 -0-
CDW Computer Centers, Inc. 326,200 -0-
Fore Systems, Inc. 712,600 -0-
Level One Communications, Inc. 678,750 -0-
Mid Atlantic Medical Services, Inc. 1,237,500 -0-
National Surgery Centers, Inc. 789,575 -0-
Neurex Corp. 1,436,700 -0-
Physio-Control International Corp. 687,500 -0-
Telephone and Data Systems, Inc. 701,300 -0-
Valero Energy Corp. 677,400 -0-
5
PORTFOLIO OF INVESTMENTS
SEPTEMBER 30, 1998 ALLIANCE QUASAR FUND
_______________________________________________________________________________
COMPANY SHARES VALUE
- -------------------------------------------------------------------------
COMMON STOCKS & OTHER INVESTMENTS-95.6%
CONSUMER PRODUCTS & SERVICES-47.2%
AIRLINES-5.1%
Alaska Air Group, Inc. (a) 1,291,800 $44,001,938
America West Holdings Corp.Cl.B (a) 1,973,500 24,668,750
Mesa Air Group, Inc. (a) 1,375,500 6,877,500
------------
75,548,188
APPAREL-3.0%
Stride Rite Corp. 920,900 7,539,869
Tommy Hilfiger Corp. (a) 633,200 25,961,200
Wolverine World Wide, Inc. 925,000 10,059,375
------------
43,560,444
BROADCASTING & CABLE-1.9%
Sinclair Broadcast Group, Inc. Cl.A (a) 739,900 12,023,375
Young Broadcasting, Inc. Cl.A (a) 478,200 16,258,800
------------
28,282,175
BUSINESS SERVICES-7.4%
Carriage Services, Inc. Cl.A (a) 581,100 14,345,906
Central Garden & Pet Co. (a) 738,800 13,667,800
Century Business Services, Inc. (a) 1,669,711 34,020,362
FirstService Corp. (a) 655,700 7,376,625
Renaissance Worldwide, Inc. (a) 1,270,000 16,668,750
TeleSpectrum Worldwide, Inc. (a) 2,835,700 23,571,756
------------
109,651,199
ENTERTAINMENT & LEISURE-5.7%
Bally Total Fitness Holding Corp. (a) 1,122,000 19,494,750
Family Golf Centers, Inc. (a) 389,450 6,912,737
N2K, Inc. (a) 404,000 2,903,750
Premier Parks, Inc. (a) 1,935,900 33,878,250
Preview Travel, Inc. (a) 380,000 6,935,000
Sunterra Corp. (a) 2,074,300 13,482,950
------------
83,607,437
RESTAURANTS & LODGING-1.8%
Florida Panthers Holdings, Inc. (a) 988,700 10,690,319
MeriStar Hospitality Corp. (a) 946,900 16,156,481
------------
26,846,800
RETAILING-22.3%
Abercrombie & Fitch Co. Cl.A (a) 223,800 9,847,200
Brylane, Inc. (a) 710,300 11,364,800
Budget Group, Inc. Cl.A (a) 2,382,700 54,355,344
Circuit City Stores, Inc.
- CarMax Group (a) 2,764,000 16,238,500
Dollar Thrifty Automotive Group, Inc. (a) 1,660,100 19,298,662
Furniture Brands International, Inc. (a) 824,800 16,083,600
Group 1 Automotive, Inc. (a) 1,319,400 19,791,000
Industrie Natuzzi SpA (ADR) (b) 1,255,600 24,798,100
Men's Wearhouse, Inc. (a) 763,250 13,166,062
Movado Group, Inc. 662,800 13,918,800
Pacific Sunwear of California, Inc. (a) 842,300 18,741,175
Sports Authority, Inc. (a) 1,016,300 7,749,288
Stage Stores, Inc. (a) 1,273,700 15,523,219
Tiffany & Co. 1,015,100 31,848,762
Trans World Entertainment Corp. (a) 593,000 10,822,250
United Auto Group, Inc. (a) 994,400 14,108,050
United Rentals, Inc. (a) 802,000 19,197,875
Venator Group, Inc. (a) 1,506,600 13,088,588
------------
329,941,275
------------
697,437,518
BASIC INDUSTRIES-12.3%
BUILDING & RELATED-0.3%
Associated Materials, Inc. (a) 660,000 5,115,000
METAL HARDWARE-3.5%
Bethlehem Steel Corp. (a) 6,196,100 51,117,825
METALS & MINING-0.3%
Royal Oak Mines, Inc. (a) 6,238,700 4,289,106
TEXTILE PRODUCTS-3.1%
Mohawk Industries, Inc. (a) 1,552,000 42,486,000
Novel Denim Holdings, Ltd. (a) 234,600 2,756,550
------------
45,242,550
6
ALLIANCE QUASAR FUND
_______________________________________________________________________________
COMPANY SHARES VALUE
- -------------------------------------------------------------------------
TRANSPORTATION & SHIPPING-5.1%
Carey International, Inc. (a) 910,100 $ 13,651,500
Consolidated Freightways Corp. (a) 2,518,600 20,778,450
Knightsbridge Tankers, Ltd. 252,200 5,422,300
OMI Corp. (a) 5,193,000 21,096,563
Teekay Shipping Corp. 818,300 14,882,831
------------
75,831,644
------------
181,596,125
TECHNOLOGY-11.2%
AEROSPACE-0.8%
Gulfstream Aerospace Corp. (a) 283,700 11,418,925
COMMUNICATION EQUIPMENT-1.0%
Comverse Technology, Inc. (a) 363,100 14,841,713
COMPUTER SOFTWARE & SERVICES-4.2%
CheckFree Holdings Corp. (a) 222,900 2,201,137
DBT Online, Inc. (a) 948,400 14,285,275
Harbinger Corp. (a) 1,151,400 8,347,650
Insight Enterprises, Inc. (a) 587,900 16,608,175
Saville Systems Plc (ADR) (a)(c) 665,400 9,648,300
Transaction Systems Architects, Inc. Cl.A (a) 309,200 10,976,600
------------
62,067,137
NETWORKING SOFTWARE-1.8%
Apex PC Solutions, Inc. (a) 993,800 19,503,325
Xylan Corp. (a) 508,275 6,734,644
------------
26,237,969
SEMI-CONDUCTOR EQUIPMENT-1.6%
Photronics, Inc. (a) 371,100 4,731,525
Uniphase Corp. (a) 261,600 10,725,600
Vitesse Semiconductor Corp. (a) 332,300 7,850,587
------------
23,307,712
TELECOMMUNICATIONS-1.5%
GST Telecommunications, Inc. (a) 951,100 5,944,375
Millicom International Cellular, SA (a)(d) 664,700 16,368,238
------------
22,312,613
MISCELLANEOUS-0.3%
Excalibur Technologies Corp. (a) 696,900 5,139,638
------------
165,325,707
HEALTH CARE-10.8%
BIOTECHNOLOGY-7.5%
Centocor, Inc. (a) 987,500 39,129,687
GelTex Pharmaceuticals, Inc. (a) 1,552,100 32,788,113
Gensia Sicor, Inc. (a) 2,294,100 9,319,781
MedImmune, Inc. (a) 463,400 30,005,150
------------
111,242,731
DRUGS, HOSPITAL SUPPLIES &
MEDICAL SERVICES-3.3%
Aradigm Corp. (a) 867,300 8,673,000
St. Jude Medical, Inc. (a) 511,800 11,835,375
Synetic, Inc. (a) 350,500 14,545,750
Veterinary Centers of America, Inc. (a) 746,600 13,625,450
------------
48,679,575
------------
159,922,306
FINANCIAL SERVICES-9.7%
BROKERAGE & MONEY MANAGEMENT-1.0%
Legg Mason, Inc. 565,200 14,871,825
INSURANCE-0.6%
Reinsurance Group of America, Inc. 168,800 8,735,400
REAL ESTATE-7.5%
Chelsea GCA Realty, Inc. 1,296,900 44,418,825
Glenborough Realty Trust, Inc. 886,200 18,831,750
Golf Trust of America, Inc. 627,200 18,659,200
Taubman Centers, Inc. 2,123,800 29,733,200
------------
111,642,975
OTHER-0.6%
International Alliance warrants,
expiring 12/30/99 (a) 740,311 8,324,797
------------
143,574,997
7
PORTFOLIO OF INVESTMENTS (CONTINUED) ALLIANCE QUASAR FUND
_______________________________________________________________________________
COMPANY SHARES VALUE
- -------------------------------------------------------------------------
ENERGY-2.9%
OIL & GAS SERVICES-2.9%
Parker Drilling Co. (a) 2,547,900 $13,217,231
Southern Union Co. 1,433,250 28,665,000
------------
41,882,231
CONSUMER MANUFACTURING-1.5%
AUTO & RELATED-1.5%
Miller Industries, Inc. (a) 1,275,100 5,897,338
Monaco Coach Corp. (a) 664,050 16,767,262
------------
22,664,600
Total Common Stocks & Other Investments
(cost $1,757,790,337) 1,412,403,484
PRINCIPAL
AMOUNT
COMPANY (000) VALUE
- -------------------------------------------------------------------------
SHORT-TERM INVESTMENTS-4.6%
U.S. GOVERNMENT & AGENCIES-4.6%
Federal Home Loan Bank
5.40%, 10/01/98 $44,300 44,300,000
Federal National Mortgage Association
5.22%, 10/16/98 300 299,347
5.28%, 11/23/98 3,000 2,976,680
Student Loan Marketing Association
5.39%, 10/01/98 20,600 20,600,000
Total Short-Term Investments
(cost $68,176,027) 68,176,027
TOTAL INVESTMENTS-100.2%
(cost $1,825,966,364) 1,480,579,511
Other assets less liabilities-(0.2%) (3,215,884)
NET ASSETS-100% $1,477,363,627
(a) Non-income producing security.
(b) Country of origin--Italy.
(c) Country of origin--Ireland.
(d) Country of origin--Luxembourg.
Glossary:
ADR - American Depositary Receipt
See notes to financial statements.
8
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1998 ALLIANCE QUASAR FUND
_______________________________________________________________________________
ASSETS
Investments in securities, at value (cost $1,825,966,364) $1,480,579,511
Cash 732,317
Receivable for capital stock sold 14,195,769
Receivable for investment securities sold 6,368,070
Dividends receivable 2,342,144
Total assets 1,504,217,811
LIABILITIES
Payable for investment securities purchased 13,853,942
Payable for capital stock redeemed 7,564,859
Advisory fee payable 3,678,768
Distribution fee payable 763,252
Accrued expenses 993,363
Total liabilities 26,854,184
NET ASSETS $1,477,363,627
COMPOSITION OF NET ASSETS
Shares of capital stock, at par $ 140,144
Additional paid-in capital 1,759,954,236
Accumulated net investment loss (330)
Accumulated net realized gain on investment transactions 62,657,949
Net unrealized depreciation of investments and other assets (345,388,372)
$1,477,363,627
CALCULATION OF MAXIMUM OFFERING PRICE
CLASS A SHARES
Net asset value and redemption price per share ($495,070,392/
22,231,985 shares of capital stock issued and outstanding) $22.27
Sales charge--4.25% of public offering price .99
Maximum offering price $23.26
CLASS B SHARES
Net asset value and offering price per share ($625,147,075/
30,989,884 shares of capital stock issued and outstanding) $20.17
CLASS C SHARES
Net asset value and offering price per share ($182,109,639/
9,024,456 shares of capital stock issued and outstanding) $20.18
ADVISOR CLASS SHARES
Net asset value, redemption and offering price per share
($175,036,521 / 7,825,780 shares of capital stock issued
and outstanding) $22.37
See notes to financial statements.
9
STATEMENT OF OPERATIONS
YEAR ENDED SEPTEMBER 30, 1998 ALLIANCE QUASAR FUND
_______________________________________________________________________________
INVESTMENT INCOME
Dividends (net of foreign taxes withheld
of $142,507) $ 8,652,140
Interest 6,618,674 $ 15,270,814
EXPENSES
Advisory fee 15,656,013
Distribution fee - Class A 1,239,764
Distribution fee - Class B 6,552,472
Distribution fee - Class C 1,893,195
Transfer agency 3,594,097
Registration 413,341
Printing 388,926
Custodian 272,845
Taxes 120,955
Administrative 120,737
Audit and legal 115,970
Directors' fees 29,000
Miscellaneous 54,391
Total expenses 30,451,706
Less: expense offset arrangement (see Note B) (220,420)
Net expenses 30,231,286
Net investment loss (14,960,472)
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain on investment transactions 79,606,746
Net change in unrealized appreciation of
investments and other assets (516,425,096)
Net loss on investments (436,818,350)
NET DECREASE IN NET ASSETS FROM OPERATIONS $(451,778,822)
See notes to financial statements.
10
STATEMENT OF CHANGES IN NET ASSETS ALLIANCE QUASAR FUND
_______________________________________________________________________________
YEAR ENDED YEAR ENDED
SEPTEMBER 30, SEPTEMBER 30,
1998 1997
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment loss $ (14,960,472) $ (8,301,609)
Net realized gain on investment transactions 79,606,746 61,906,245
Net change in unrealized appreciation of
investments and other assets (516,425,096) 130,575,519
Net increase (decrease) in net assets
from operations (451,778,822) 184,180,155
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net realized gain on investments
Class A (17,164,110) (35,781,862)
Class B (24,996,773) (23,349,486)
Class C (7,133,144) (5,648,782)
Advisor Class (2,825,501) (312,701)
CAPITAL STOCK TRANSACTIONS
Net increase 868,194,847 623,150,616
Total increase 364,296,497 742,237,940
NET ASSETS
Beginning of year 1,113,067,130 370,829,190
End of year $1,477,363,627 $1,113,067,130
See notes to financial statements.
11
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1998 ALLIANCE QUASAR FUND
_______________________________________________________________________________
NOTE A: SIGNIFICANT ACCOUNTING POLICIES
Alliance Quasar Fund, Inc. (the "Fund") is registered under the Investment
Company Act of 1940 as a diversified, open-end management investment company.
The Fund offers Class A, Class B, Class C and Advisor Class shares. Class A
shares are sold with a front-end sales charge of up to 4.25% for purchases not
exceeding $1,000,000. With respect to purchases of $1,000,000 or more, Class A
shares redeemed within one year of purchase will be subject to a contingent
deferred sales charge of 1%. Class B shares are currently sold with a
contingent deferred sales charge which declines from 4% to zero depending on
the period of time the shares are held. Class B shares will automatically
convert to Class A shares eight years after the end of the calendar month of
purchase. Class C shares are subject to a contingent deferred sales charge of
1% on redemptions made within the first year after purchase. Advisor Class
shares are sold without an initial or contingent deferred sales charge and are
not subject to ongoing distribution expenses. Advisor Class shares are offered
to investors participating in fee-based programs and to certain retirement plan
accounts. All four classes of shares have identical voting, dividend,
liquidation and other rights, except that each class bears different
distribution expenses and has exclusive voting rights with respect to its
distribution plan. The financial statements have been prepared in conformity
with generally accepted accounting principles which require management to make
certain estimates and assumptions that affect the reported amounts of assets
and liabilities in the financial statements and amounts of income and expenses
during the reporting period. Actual results could differ from those estimates.
The following is a summary of significant accounting policies followed by the
Fund.
1. SECURITY VALUATION
Portfolio securities traded on a national securities exchange are generally
valued at the last reported sales price or if no sale occurred, at the mean of
the closing bid and asked prices on that day. Securities traded in the
over-the-counter market, including securities traded on a national securities
exchange whose primary market is believed to be over-the-counter, are valued at
the mean of the current bid and asked prices. Readily marketable debt
securities are valued at the last sales price. Securities which mature in 60
days or less are valued at amortized cost, unless this method does not
represent fair value. Securities for which current market quotations are not
readily available are valued at their fair value as determined in good faith
by, or in accordance with procedures adopted by, the Board of Directors. Fixed
income securities may be valued on the basis of prices obtained from a pricing
service when such prices are believed to reflect the fair market value of such
securities.
2. TAXES
It is the Fund's policy to meet the requirements of the Internal Revenue Code
applicable to regulated investment companies and to distribute all of its
investment company taxable income and net realized gains, if any, to
shareholders. Therefore, no provisions for federal income or excise taxes are
required.
3. INVESTMENT INCOME AND INVESTMENT TRANSACTIONS
Dividend income is recorded on the ex-dividend date. Interest income is accrued
daily. Investment transactions are accounted for on the date the securities are
purchased or sold. The fund accretes discounts as adjustments to income.
Investment gains and losses are determined on the identified cost basis.
4. INCOME AND EXPENSES
All income earned and expenses incurred by the Fund are borne on a pro-rata
basis by each outstanding class of shares, based on the proportionate interest
in the Fund represented by the net assets of such class, except that the Fund's
Class B and Class C shares bear higher distribution and transfer agent fees
than Class A shares and the Advisory Class shares have no distribution fees.
5. DIVIDENDS AND DISTRIBUTIONS
Dividends and distributions to shareholders are recorded on the ex-dividend
date.
Income dividends and capital gains distributions are determined in accordance
with federal tax regulations and may differ from those determined in accordance
with generally accepted accounting principles. To the extent these differences
are permanent, such amounts are reclassified within the capital accounts based
on their federal tax basis treatment; temporary differences, do not require
such reclassification. During the current fiscal year, permanent differences,
primarily due to net investment loss, resulted in a net increase in accumulated
net investment loss and a corresponding decrease in accumulated net realized
gain on investment transactions. This reclassification had no effect on net
assets.
12
ALLIANCE QUASAR FUND
_______________________________________________________________________________
NOTE B: ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES
Under the terms of an investment advisory agreement, the Fund pays Alliance
Capital Management L.P. (the "Adviser") an advisory fee at a quarterly rate
equal to .25% (approximately 1% on an annual basis) of the net assets of the
Fund valued on the last business day of the previous quarter.
Pursuant to the advisory agreement, the Fund paid $120,737 to the Adviser
representing the cost of certain legal and accounting services provided to the
Fund by the Adviser for the year ended September 30, 1998.
The Fund compensates Alliance Fund Services, Inc., a wholly-owned subsidiary of
the Adviser, under a Transfer Agency Agreement for providing personnel and
facilities to perform transfer agency services for the Fund. Such compensation
amounted to $2,255,105 for the year ended September 30, 1998.
In addition, for the year ended September 30, 1998, the Fund's expenses were
reduced by $220,420 under an expense offset arrangement with Alliance Fund
Services. Transfer agency fees reported in the statement of operation exclude
these credits.
Alliance Fund Distributors, Inc. (the "Distributor"), a wholly-owned subsidiary
of the Adviser, serves as the Distributor of the Fund's shares. The Distributor
received front-end sales charges of $224,489 from the sales of Class A shares
and $21,804, $1,179,325 and $118,235 in contingent deferred sales charges
imposed upon redemptions by shareholders of Class A, Class B and Class C
shares, respectively, for the year ended September 30, 1998.
Brokerage commissions paid on investment transactions for the year ended
September 30, 1998 amounted to $5,405,376, of which $19,605 was paid to
Donaldson, Lufkin & Jenrette Securities Corp., an affiliate of the Adviser.
NOTE C: DISTRIBUTION SERVICES AGREEMENT
The Fund has adopted a Distribution Services Agreement (the "Agreement")
pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the
Agreement, the Fund pays a distribution fee to the Distributor at an annual
rate of up to .30% of the Fund's average daily net assets attributable to Class
A shares and 1% of the average daily net assets attributable to both Class B
and Class C shares. There is no distribution fee on the Advisor Class shares.
The fees are accrued daily and paid monthly. The Agreement provides that the
Distributor will use such payments in their entirety for distribution
assistance and promotional activities. The Distributor has incurred expenses in
excess of the distribution costs reimbursed by the Fund in the amount of
$27,654,262 and $1,923,179 for Class B and Class C shares, respectively; such
costs may be recovered from the Fund in future periods so long as the Agreement
is in effect. In accordance with the Agreement, there is no provision for
recovery of unreimbursed distribution costs incurred by the Distributor beyond
the current fiscal year for Class A shares. The Agreement also provides that
the Adviser may use its own resources to finance the distribution of the Fund's
shares.
NOTE D: INVESTMENT TRANSACTIONS
Purchases and sales of investment securities (excluding short-term investments
and U.S. government securities) aggregated $2,350,819,090 and $1,475,171,419,
respectively, for the year ended September 30, 1998. There were no purchases or
sales of U.S. government and government agency obligations for the year ended
September 30, 1998.
At September 30, 1998, the cost of investments for federal income tax purposes
was $1,836,952,502. Accordingly, gross unrealized appreciation of investments
was $83,287,021 and gross unrealized depreciation of investments was
$439,660,012, resulting in net unrealized depreciation of $356,372,991.
13
NOTES TO FINANCIAL STATEMENTS (CONTINUED) ALLIANCE QUASAR FUND
_______________________________________________________________________________
NOTE E: CAPITAL STOCK
There are 12,000,000,000 shares of $.002 par value capital stock authorized,
divided into four classes, designated Class A, Class B, Class C and Advisor
Class shares. Each class consists of 3,000,000,000 authorized shares.
Transactions in capital stock were as follows:
SHARES AMOUNT
--------------------------- ------------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
SEP. 30, SEP. 30, SEP. 30, SEP. 30,
1998 1997 1998 1997
------------- ------------ -------------- --------------
CLASS A
Shares sold 43,817,026 11,397,616 $1,244,246,754 $301,819,124
Shares issued in
reinvestment of
distributions 571,457 1,338,101 15,988,123 31,392,004
Shares converted
from Class B 165,256 93,234 4,647,898 2,388,921
Shares redeemed (35,561,736) (7,820,120) (1,011,637,305) (205,201,851)
Net increase 8,992,003 5,008,831 $ 253,245,470 $130,398,198
CLASS B
Shares sold 18,286,351 15,718,977 $ 482,762,932 $384,984,682
Shares issued in
reinvestment of
distributions 923,019 806,589 23,536,952 17,462,788
Shares converted
to Class A (181,899) (101,254) (4,647,898) (2,388,921)
Shares redeemed (6,112,452) (2,654,832) (154,925,238) (64,196,011)
Net increase 12,915,019 13,769,480 $ 346,726,748 $335,862,538
CLASS C
Shares sold 11,956,015 6,517,559 $ 308,470,104 $158,023,140
Shares issued in
reinvestment of
distributions 260,405 149,743 6,642,958 3,241,980
Shares redeemed (8,416,893) (2,534,347) (213,847,794) (61,156,504)
Net increase 3,799,527 4,132,955 $ 101,265,268 $100,108,616
OCT. 2,1996(A) OCT. 2,1996(A)
TO TO
SEP. 30, SEP. 30,
1997 1997
------------ --------------
ADVISOR CLASS
Shares sold 9,129,797 2,134,062 $ 259,655,427 $ 58,915,871
Shares issued in
reinvestment of
distributions 95,462 13,323 2,676,749 312,693
Shares redeemed (3,452,506) (94,358) (95,374,815) (2,447,300)
Net increase 5,772,753 2,053,027 $ 166,957,361 $ 56,781,264
(a) Commencement of distribution.
14
ALLIANCE QUASAR FUND
_______________________________________________________________________________
NOTE F: BANK BORROWING
A number of open-end mutual funds managed by the Adviser, including the Fund,
participate in a $750 million revolving credit facility (the "Facility") to
provide short-term financing if necessary, subject to certain restrictions, in
connection with abnormal redemption activity. Commitment fees related to the
Facility are paid by the participating funds and are included in the
miscellaneous expenses in the statement of operations. The Fund did not utilize
the Facility during the year ended September 30, 1998.
15
FINANCIAL HIGHLIGHTS ALLIANCE QUASAR FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
<TABLE>
<CAPTION>
CLASS A
----------------------------------------------------------------
YEAR ENDED SEPTEMBER 30,
----------------------------------------------------------------
1998 1997 1996 1995 1994
------------ ------------ ---------- ------------ ----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year $30.37 $27.92 $24.16 $22.65 $24.43
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (.17)(a) (.24)(a) (.25) (.22)(a) (.60)
Net realized and unrealized gain (loss)
on investment transactions (6.70) 6.80 8.82 5.59 (.36)
Net increase (decrease) in net asset
value from operations (6.87) 6.56 8.57 5.37 (.96)
LESS: DISTRIBUTIONS
Distributions from net realized gains (1.23) (4.11) (4.81) (3.86) (.82)
Net asset value, end of year $22.27 $30.37 $27.92 $24.16 $22.65
TOTAL RETURN
Total investment return based on
net asset value (b) (23.45)% 27.81% 42.42% 30.73% (4.05)%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of year (000's omitted) $495,070 $402,081 $229,798 $146,663 $155,470
Ratio of expenses to average net assets 1.61%(c) 1.67% 1.79% 1.83% 1.67%
Ratio of net investment loss to
average net assets (.59)% (.91)% (1.11)% (1.06)% (1.15)%
Portfolio turnover rate 109% 135% 168% 160% 110%
</TABLE>
See footnote summary on page 19.
16
ALLIANCE QUASAR FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
<TABLE>
<CAPTION>
CLASS B
----------------------------------------------------------------
YEAR ENDED SEPTEMBER 30,
----------------------------------------------------------------
1998 1997 1996 1995 1994
------------ ------------ ---------- ------------ ----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year $27.83 $26.13 $23.03 $21.92 $23.88
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (.36)(a) (.42)(a) (.20) (.37)(a) (.53)
Net realized and unrealized gain (loss)
on investment transactions (6.07) 6.23 8.11 5.34 (.61)
Net increase (decrease) in net asset
value from operations (6.43) 5.81 7.91 4.97 (1.14)
LESS: DISTRIBUTIONS
Distributions from net realized gains (1.23) (4.11) (4.81) (3.86) (.82)
Net asset value, end of year $20.17 $27.83 $26.13 $23.03 $21.92
TOTAL RETURN
Total investment return based on net
asset value (b) (24.03)% 26.70% 41.48% 29.78% (4.92)%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of year (000's omitted) $625,147 $503,037 $112,490 $16,604 $13,901
Ratio of expenses to average net assets 2.39%(c) 2.51% 2.62% 2.65% 2.50%
Ratio of net investment loss to
average net assets (1.36)% (1.73)% (1.96)% (1.88)% (1.98)%
Portfolio turnover rate 109% 135% 168% 160% 110%
</TABLE>
See footnote summary on page 19.
17
FINANCIAL HIGHLIGHTS (CONTINUED) ALLIANCE QUASAR FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
<TABLE>
<CAPTION>
CLASS C
----------------------------------------------------------------
YEAR ENDED SEPTEMBER 30,
----------------------------------------------------------------
1998 1997 1996 1995 1994
------------ ------------ ---------- ------------ ----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $27.85 $26.14 $23.05 $21.92 $23.88
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (.35)(a) (.42)(a) (.20) (.37)(a) (.36)
Net realized and unrealized gain (loss)
on investment transactions (6.09) 6.24 8.10 5.36 (.78)
Net increase (decrease) in net asset
value from operations (6.44) 5.82 7.90 4.99 (1.14)
LESS: DISTRIBUTIONS
Distributions from net realized gains (1.23) (4.11) (4.81) (3.86) (.82)
Net asset value, end of year $20.18 $27.85 $26.14 $23.05 $21.92
TOTAL RETURN
Total investment return based on net
asset value (b) (24.05)% 26.74% 41.46% 29.87% (4.92)%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of year (000's omitted) $182,110 $145,494 $28,541 $1,611 $1,220
Ratio of expenses to average net assets 2.38%(c) 2.50% 2.61% 2.64% 2.48%
Ratio of net investment loss to average
net assets (1.35)% (1.72)% (1.94)% (1.76)% (1.96)%
Portfolio turnover rate 109% 135% 168% 160% 110%
</TABLE>
See footnote summary on page 19.
18
ALLIANCE QUASAR FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
ADVISOR CLASS
----------------------------
OCTOBER 2,
1996(D)
YEAR ENDED TO
SEPTEMBER 30, SEPTEMBER 30,
1998 1997
------------- -------------
Net asset value, beginning of period $30.42 $27.82
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (a) (.09) (.17)
Net realized and unrealized gain (loss) on
investment transactions (6.73) 6.88
Net increase (decrease) in net asset value
from operations (6.82) 6.71
LESS: DISTRIBUTIONS
Distributions from net realized gains (1.23) (4.11)
Net asset value, end of period $22.37 $30.42
TOTAL RETURN
Total investment return based on net asset value(b) (23.24)% 28.47%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $175,037 $62,455
Ratio of expenses to average net assets 1.38%(c) 1.58%(e)
Ratio of net investment loss to average net assets (.32)% (.74)%(e)
Portfolio turnover rate 109% 135%
(a) Based on average shares outstanding.
(b) Total investment return is calculated assuming an initial investment made
at the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period. Initial sales charges or contingent
deferred sales charges are not reflected in the calculation of total investment
return. Total investment return calculated for a period of less than one year
is not annualized.
(c) Ratios reflect expenses grossed up for expense offset arrangement with the
Transfer Agent. For the year ended September 30, 1998, the ratios of expenses
to average net assets were 1.60%, 2.38%, 2.37% and 1.37% for Class A, B, C, and
Advisor Class shares, respectively.
(d) Commencement of distribution.
(e) Annualized.
19
REPORT OF ERNST & YOUNG LLP
INDEPENDENT AUDITORS ALLIANCE QUASAR FUND
_______________________________________________________________________________
TO THE SHAREHOLDERS AND BOARD OF DIRECTORS ALLIANCE QUASAR FUND, INC.
We have audited the accompanying statement of assets and liabilities of
Alliance Quasar Fund, Inc. (the "Fund"), including the portfolio of
investments, as of September 30, 1998, and the related statement of operations
for the year then ended, the statement of changes in net assets for each of the
two years in the period then ended, and the financial highlights for each of
the periods indicated therein. These financial statements and financial
highlights are the responsibility of the Fund's management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
September 30, 1998, by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Alliance Quasar Fund, Inc. at September 30, 1998, the results of its operations
for the year then ended, the changes in its net assets for each of the two
years in the period then ended, and the financial highlights for each of the
indicated periods, in conformity with generally accepted accounting principles.
New York, New York
November 9, 1998
FEDERAL INCOME TAX INFORMATION (UNAUDITED)
_______________________________________________________________________________
In order to meet certain requirements of the Internal Revenue Code we are
advising you that $13,808,968 of the capital gain distributions paid by the
Fund during the fiscal year September 30, 1998 are subject to a maximum tax
rate of 20%. A portion of the distribution paid by the Fund qualify for the
dividends received deduction available to corporate shareholders.
Shareholders should not use the above information to prepare their tax returns.
The information necessary to complete your income tax returns will be included
with your Form 1099 DIVwhich will be sent to you separately in January 1999.
20
ALLIANCE QUASAR FUND
_______________________________________________________________________________
BOARD OF DIRECTORS
JOHN D. CARIFA, CHAIRMAN
RUTH BLOCK (1)
DAVID H. DIEVLER (1)
JOHN H. DOBKIN (1)
WILLIAM H. FOULK, JR. (1)
DR. JAMES M. HESTER (1)
CLIFFORD L. MICHEL (1)
DONALD J. ROBINSON (1)
OFFICERS
ALDEN M. STEWART, PRESIDENT
KATHLEEN A. CORBET, SENIOR VICE PRESIDENT
RANDALL E. HAASE, SENIOR VICE PRESIDENT
THOMAS J. BARDONG, VICE PRESIDENT
DANIEL V. PANKER, VICE PRESIDENT
EDMUND P. BERGAN, JR., SECRETARY
MARK D. GERSTEN, TREASURER & CHIEF FINANCIAL OFFICER
VINCENT S. NOTO, CONTROLLER
CUSTODIAN
STATE STREET BANK & TRUST COMPANY
225 Franklin Street
Boston, MA 02110
DISTRIBUTOR
ALLIANCE FUND DISTRIBUTORS, INC.
1345 Avenue of the Americas
New York, NY 10105
LEGAL COUNSEL
SEWARD & KISSEL
One Battery Park Plaza
New York, NY 10004
TRANSFER AGENT
ALLIANCE FUND SERVICES, INC.
P.O. Box 1520
Secaucus, NJ 07096-1520
Toll-free 1-(800) 221-5672
INDEPENDENT AUDITORS
ERNST & YOUNG LLP
787 Seventh Avenue
New York, NY 10019
(1) Member of the Audit Committee.
21
THE ALLIANCE FAMILY OF MUTUAL FUNDS
_______________________________________________________________________________
FIXED INCOME
Alliance Bond Fund
U.S. Government Portfolio
Corporate Bond Portfolio
Alliance Global Dollar Government Fund
Alliance Global Strategic Income Trust
Alliance High Yield Fund
Alliance Mortgage Securities Income Fund
Alliance Limited Maturity Government Fund
Alliance Multi-Market Strategy Trust
Alliance North American Government Income Trust
Alliance Short-Term Multi-Market Trust
Alliance Short-Term U.S. Government Fund
Alliance World Income Trust
TAX-FREE INCOME
Alliance Municipal Income Fund
California Portfolio
Insured California Portfolio
Insured National Portfolio
National Portfolio
New York Portfolio
Alliance Municipal Income Fund II
Arizona Portfolio
Florida Portfolio
Massachusetts Portfolio
Michigan Portfolio
Minnesota Portfolio
New Jersey Portfolio
Ohio Portfolio
Pennsylvania Portfolio
Virginia Portfolio
MONEY MARKET
AFD Exchange Reserves
GROWTH
The Alliance Fund
Alliance Global Environment Fund
Alliance Growth Fund
Alliance Premier Growth Fund
Alliance/Regent Sector Opportunity Fund
GROWTH & INCOME
Alliance Balanced Shares
Alliance Conservative Investors Fund
Alliance Growth & Income Fund
Alliance Growth Investors Fund
Alliance Income Builder Fund
Alliance Real Estate Investment Fund
Alliance Strategic Balanced Fund
Alliance Utility Income Fund
AGGRESSIVE GROWTH
Alliance Global Small Cap Fund
Alliance Quasar Fund
Alliance Technology Fund
INTERNATIONAL
Alliance All-Asia Investment Fund
Alliance Greater China '97 Fund
Alliance International Fund
Alliance International Premier Growth Fund
Alliance New Europe Fund
Alliance Worldwide Privatization Fund
CLOSED-END FUNDS
Alliance All-Market Advantage Fund
ACM Government Income Fund
ACM Government Opportunity Fund
ACM Government Securities Fund
ACM Government Spectrum Fund
ACM Managed Dollar Income Fund
ACM Managed Income Fund
ACM Municipal Securities Income Fund
Alliance World Dollar Government Fund
Alliance World Dollar Government Fund II
The Austria Fund
The Korean Investment Fund
The Spain Fund
The Southern Africa Fund
CASH MANAGEMENT SERVICES
ACM Institutional Reserves
Government Portfolio
Prime Portfolio
Tax-Free Portfolio
Trust Portfolio
Alliance Capital Reserves
Alliance Government Reserves
Alliance Insured Account
Alliance Money Reserves
Alliance Municipal Trust
California Portfolio
Connecticut Portfolio
Florida Portfolio
General Portfolio
Massachusetts Portfolio
New Jersey Portfolio
New York Portfolio
Virginia Portfolio
Alliance Treasury Reserves
Alliance Money Market Fund
Prime Portfolio
Government Portfolio
General Municipal Portfolio
22
ALLIANCE QUASAR FUND
1345 Avenue of the Americas
New York, NY 10105
(800) 221-5672
ALLIANCE CAPITAL
THIS REPORT IS INTENDED SOLELY FOR DISTRIBUTION TO CURRENT SHAREHOLDERS
OF THE FUND.
R THESE REGISTERED SERVICE MARKS USED UNDER LICENSE FROM THE OWNER,
ALLIANCE CAPITAL MANAGEMENT L.P.
QSRAR
