Gabelli Automation ETF

Semiannual Report — June 30, 2023

 

(Y)our Portfolio Management Team

 

       
  Justin Bergner, CFA
Portfolio Manager
BA, Yale University
MBA, University of Pennsylvania
  Brett Kearney, CFA
Portfolio Manager
BA, Washington & Lee University
MBA, Columbia Business School
  Hendi Susanto
Portfolio Manager
BS, University of Minnesota,
MBA, Wharton School of Business
 

 

To Our Shareholders,

 

For the six months ended June 30, 2023, the net asset value (NAV) total return of Gabelli Automation ETF (the Fund) was 11.6% compared with a total return of 16.9% for the S&P 500 Index. The total return based on the Fund’s Market Price was 11.6%. The Fund’s NAV per share was $23.27, while the price of the publicly traded shares closed at $23.29 on the New York Stock Exchange (NYSE) Arca. See page 4 for additional performance information.

 

Enclosed are the financial statements, including the schedule of investments, for the Fund’s semiannual report as of June 30, 2023.

 

 

 

 

 

 

 

 

 

 

As permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund’s annual and semiannual shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports. Instead, the reports will be made available on the Fund’s website www.gabelli.com/funds/etfs, and you will be notified by mail each time a report is posted and provided with a website link to access the report. If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. To elect to receive all future reports on paper free of charge, please contact your financial intermediary, or, if you invest directly with the Fund, you may call 800-422-3554 or send an email request to [email protected].

 

 

 

 

Investment Objective and Strategy (Unaudited)

 

The Fund will primarily invest in U.S. exchange listed common stock and preferred stock. The Fund may also invest in foreign securities by investing in American Depositary Receipts. The Fund focuses on companies which appear underpriced relative to their Private Market Value (“PMV”). PMV is the value the Adviser believes informed investors would be willing to pay for a company. Under normal market conditions, the Fund seeks to achieve its investment objective by investing at least 80% of its net assets, plus borrowings for investment purposes, in publicly traded equity securities of automation firms (“Automation Companies”) listed on a domestic or foreign exchange, throughout the world, including the United States (the “80% Policy”).

 

The Fund defines Automation Companies as any company that is engaged in designing, developing, supporting, or manufacturing automation equipment, related technology, or processes, and also firms that use these technologies, equipment, and processes to automate parts of their own businesses. These firms include industrial and service automation, cobotics, robotics, artificial intelligence, autonomous driving, and related equipment, technology, and services. In pursuing the investment theme, the Fund may invest in firms in any economic sector and in any geographic region.

 

Performance Discussion (Unaudited)

 

GAST holds a number of cyclical industrial companies whose stocks were pressured by recession fears during the first half of this year and benefitted less than others from enthusiasm surrounding artificial intelligence. While broad inflation pressures have eased from peak levels last year, businesses continue to struggle with labor availability and wage pressure. At the same time, there is currently a manufacturing construction boom in the U.S. (with investment into new manufacturing structures accounting for nearly 0.5% of GDP in the first half of 2023, the most since 1991, according to the Commerce Department). Companies have been reshoring production to North America and capitalizing on federal incentives provided in the Infrastructure Investment and Jobs Act, Inflation Reduction Act, and CHIPS and Science Act.

 

Top contributors to performance in the first half of the year included: Matthews (2.8% of net assets as of June 30, 2023) showed great returns as investors gained greater appreciation for its energy storage business. Matthew’s industrial technologies segment includes nearly $100 million in fast-growing energy storage revenue, where the company sells dry electrode machines to electric vehicle companies and battery makers (to press lithium powder into “battery sheets” less expensively than with standard wet electrode machinery). The segment also contains growing warehouse automation revenue, where Matthews sells predominantly software to retail, e-commerce, and automated assembly companies in the U.S; and L.B. Foster Company (2.0%) is benefitting from strong demand for its rail technologies offering, which includes automated track lubrication systems and sensor-enabled remote track monitoring solutions (for passenger and freight rail networks) as well as information totems and display systems used at passenger rail stations. The company has seen a notable uptick in interest for its track condition monitoring systems (including its proprietary Wheel Impact Load Detection system) following recent high-profile train derailments (including in East Palestine, OH) and may receive a further benefit from the U.S. Railway Safety Act (currently making its way through Congress).

 

Detractors from the portfolio included: Ardagh Metal Packaging (no longer held) was one of our biggest detractors in the first half of 2023 as the company reduced its near-term outlook for sales in Brazil (due to political uncertainty following the October 2022 election and presidential transition process) and North America (where beverage can volumes face moderate headwinds from inflation-strapped consumers); and Aspen Technology (1.1%) was also a detractor in the first half of 2023 as the company announced disappointing Q1 2023 results and near-term outlook. We used the sell-off in the stock to build our position in Aspen Technology as we expect

 

2

 

 

the company to benefit from secular growth in process automation software. We are encouraged that the board, in May, authorized a new $100 million share repurchase authorization to capitalize on short-term weakness in shares.

 

We appreciate your investment in Gabelli Automation ETF.

 

Thank you for your confidence and trust.

 

 

 

 

 

 

 

 

 

 

The views expressed reflect the opinions of the Fund’s portfolio managers and Gabelli Funds, LLC, the Adviser, as of the date of this report and are subject to change without notice based on changes in market, economic, or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

 

3

 

 

Comparative Results

 

 

Average Annual Returns through June 30, 2023 (Unaudited)

 

Total returns and average annual returns reflect changes in share price, reinvestment of distributions, and are net of ex-penses. Performance returns for periods of greater than one year are annualized.

 

  6 Months     1 Year     Since
Inception
(1/3/22) (a)
 
Gabelli Automation ETF (GAST)                        
NAV Total Return     11.60 %     19.87 %     (4.21 )%
Investment Total Return (b)     11.60       20.20       (4.19 )
S&P 500 Index (c)     16.89       19.59       (3.30 )

 

 
(a) GAST first issued shares January 3, 2022, and shares commenced trading on the NYSE Arca January 5, 2022.
(b) Investment total returns are based on the closing market price on the NYSE Arca at the end of the period.
(c) The S&P 500 Index is a market capitalization weighted index of 500 large capitalization stocks commonly used to represent the U.S. equity market. Dividends are considered reinvested. You cannot invest directly in an index.

 

In the current prospectus of the Gabelli Automation ETF dated April 28, 2023, the gross expense ratio for the Fund is 0.90%. The net expense ratio for the Fund after contractual expense waiver by Gabelli Funds, LLC (the Adviser) was 0.90%. The waiver is in effect through April 30, 2024. Investors should carefully consider the investment objec-tives, risks, charges, and expenses of the Fund before investing. The prospectus contains information about these and other matters and should be read carefully before investing. To obtain a prospectus, please visit our website at www.gabelli.com/funds/etfs.

 

Returns represent past performance and do not guarantee future results. Investment returns and the principal value of an investment will fluctuate. When shares are sold they may be worth more or less than their original cost. Cur-rent performance may be lower or higher than the performance data presented. Visit www.gabelli.com/funds/etfs for performance information as of the most recent month end.

 

 

4

 

 

Discount & Premium Information

 

Information regarding how often shares of the Fund traded on the New York Stock Exchange Arca at a price above, i.e., at a premium, or below, i.e., at a discount, the NAV can be found at www.gabelli.com/funds/etfs.

 

Information showing the Fund’s net asset value, market price, premiums and discounts, and bid-ask spreads for various time periods is available by visiting the Fund’s website at www.gabelli.com/funds/etfs.

 

This ETF is different from traditional ETFs. Traditional ETFs tell the public what assets they hold each day. This ETF will not. This may create additional risks for your investment. For example:

 

You may have to pay more money to trade the ETF’s shares. This ETF will provide less information to traders, who tend to charge more for trades when they have less information.

 

The price you pay to buy ETF shares on an exchange may not match the value of the ETF’s portfolio. The same is true when you sell shares. These price differences may be greater for this ETF compared with other ETFs because it provides less information to traders.

 

These additional risks may be even greater in bad or uncertain market conditions.

 

The differences between this ETF and other ETFs may also have advantages. By keeping certain information about the ETF secret, this ETF may face less risk that other traders can predict or copy its investment strategy. This may improve the ETF’s performance. If other traders are able to copy or predict the ETF’s investment strategy, however, this may hurt the ETF’s performance. For additional information regarding the unique attributes and risks of the ETF, see the Active Shares prospectus/registration statement.

 

5

 

 

Gabelli Automation ETF

Disclosure of Fund Expenses (Unaudited)

For the Six Months Period from January 1, 2023 through June 30, 2023 Expense Table
 

 

We believe it is important for you to understand the impact of fees and expenses regarding your investment. All funds have operating expenses. As a shareholder of a fund, you incur two types of costs, transaction costs, which include brokerage commissions on purchases and sales of fund shares, and ongoing costs, which include costs for portfolio management, administrative services, and shareholder reports (like this one), among others. Operating expenses, which are deducted from a fund’s gross income, directly reduce the investment return of a fund. When a fund’s expenses are expressed as a percentage of its average net assets, this figure is known as the expense ratio. The following examples are intended to help you understand the ongoing costs (in dollars) of investing in your Fund and to compare these costs with those of other funds. The examples are based on an investment of $1,000 made at the beginning of the period shown and held for the entire period.

 

The Expense Table below illustrates your Fund’s costs in two ways:

 

Actual Fund Return: This section provides information about actual account values and actual expenses. You may use this section to help you to estimate the actual expenses that you paid over the period after any fee waivers and expense reimbursements. The “Ending Account Value” shown is derived from the Fund’s actual return during the period ended June 30, 2023, and the “Expenses Paid During Period” shows the dollar amount that would have been paid by an investor who started with $1,000 in the Fund. You may use this information, together with the amount you invested, to estimate the expenses that you paid over the period.

 

To do so, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number given for your Fund under the heading “Expenses Paid During Period” to estimate the expenses you paid during this period.

 

Hypothetical 5% Return: This section provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio. It assumes a hypothetical annualized return of 5% before expenses during the period shown. In this case – because the hypothetical return used is not the Fund’s actual return – the results do

not apply to your investment and you cannot use the hypothetical account value and expense to estimate the actual ending account balance or expenses you paid for the period. This example is useful in making comparisons of the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in shareholder reports of other funds.

 

Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs such as sales charges (loads), redemption fees, or exchange fees, if any, which would be described in the Prospectus. If these costs were applied to your account, your costs would be higher. Therefore, the 5% hypothetical return is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.

 

   

Beginning

Account Value

01/01/23

   

Ending

Account Value

06/30/23

   

Annualized

Expense

Ratio

   

Expenses

Paid During

Period*

 
Gabelli Automation ETF  
Actual Fund Return                              
    $ 1,000.00     $ 1,116.00     0.00%     $ 0.00  
Hypothetical 5% Return                              
    $ 1,000.00     $ 1,024.79     0.00%     $ 0.00  

 

 
* Expenses are equal to the Fund’s annualized expense ratio for the last six months multiplied by the average account value over the period, multiplied by the number of days in the most recent fiscal half year (181 days), then divided by 365.

 

6

 

 

Summary of Portfolio Holdings (Unaudited)

 

The following table presents portfolio holdings as a percent of net assets as of June 30, 2023:

 

GABELLI AUTOMATION ETF

 

Prepackaged Software     10.5 %
Aerospace and Defense     7.0 %
Equipment and Supplies     6.2 %
Measuring & Controlling Devices, NEC     5.4 %
Metal Cans     4.7 %
Electronics     4.3 %
Electronic & Other Electrical Equipment     4.3 %
Consumer Services     4.0 %
Consumer Products     3.7 %
Financial Services     3.2 %
General Industrial Machinery & Equipment     2.8 %
Wholesale-Durable Goods     2.5 %
Environmental Services     2.4 %
Pumps & Pumping Equipment     2.4 %
Electric Lighting & Wiring Equipment     2.4 %
Computer Programming, Data Processing, Etc     2.3 %
Industrial Instruments For Measurement, Display, and Control     2.1 %
Diversified Industrial     2.0 %
Building and Construction     1.8 %
Computer Software and Services     1.5 %
Computer Integrated Systems Design     1.1 %
Fabricated Structural Metal Products     0.9 %
Other Assets and Liabilities (Net)     22.5 %
      100.0 %

 

The Fund files a complete schedule of portfolio holdings with the Securities and Exchange Commission (the SEC) for the first and third quarters of each fiscal year on Form N-PORT. Shareholders may obtain this information at www.gabelli.com or by calling the Fund at 800-GABELLI (800-422-3554). The Fund’s Form N-PORT is available on the SEC’s website at www.sec.gov and may also be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 800-SEC-0330.

 

Proxy Voting

 

The Fund files Form N-PX with its complete proxy voting record for the twelve months ended June 30, no later than August 31 of each year. A description of the Fund’s proxy voting policies, procedures, and how each Fund voted proxies relating to portfolio securities is available without charge, upon request, by (i) calling 800-GABELLI (800-422-3554); (ii) writing to The Gabelli Funds at One Corporate Center, Rye, NY 10580-1422; or (iii) visiting the SEC’s website at www.sec.gov.

 

7

 

 

Gabelli Automation ETF

Schedule of Investments — June 30, 2023 (Unaudited)

 

 

Shares         Cost     Market
Value
 
        COMMON STOCKS — 77.5%                
        Aerospace and Defense — 7.0%                
  4,454     Allied Motion Technologies Inc.   $ 185,733     $ 177,893  
  2,250     Mercury Systems Inc.†     94,751       77,827  
  192     Northrop Grumman Corp.     90,374       87,514  
              370,858       343,234  
        Building and Construction — 1.8%                
  1,307     Johnson Controls International plc     105,236       89,059  
                         
        Computer Integrated Systems Design — 1.1%                
  4,232     Kyndryl Holdings Inc.†     78,597       56,201  
                         
        Computer Programming, Data Processing, Etc. — 2.3%                
  920     Alphabet Inc., Cl. A†     131,008       110,124  
                         
        Computer Software and Services — 1.5%                
  3,000     NCR Corp.†     58,726       75,600  
                         
        Consumer Products — 3.7%                
  1,430     Spectrum Brands Holdings Inc.     107,594       111,612  
  2,283     The AZEK Co. Inc.†     103,375       69,152  
              210,969       180,764  
        Consumer Services — 4.0%                
  520     Amazon.com Inc.†     86,538       67,787  
  7,288     Resideo Technologies Inc.†     184,826       128,706  
              271,364       196,493  
        Diversified Industrial — 2.0%                
  6,750     L B Foster Co., Cl. A†     66,801       96,390  
                         
        Electric Lighting & Wiring Equipment — 2.4%                
  2,691     AZZ Inc.     130,930       116,951  
                         
        Electronic & Other Electrical Equipment — 4.3%                
  2,300     Emerson Electric Co.     218,886       207,897  
                         
        Electronics — 4.3%                
  1,127     Itron Inc.†     78,406       81,256  
  4,617     Kimball Electronics Inc.†     106,013       127,568  
              184,419       208,824  
        Environmental Services — 2.4%                
  769     Republic Services Inc.     104,743       117,788  
Shares         Cost     Market
Value
 
        Equipment and Supplies — 6.2%                
  1,254     AMETEK Inc.   $ 183,963     $ 202,997  
  1,260     Tennant Co.     105,087       102,199  
              289,050       305,196  
        Fabricated Structural Metal Products — 0.9%                
  1,229     Proto Labs Inc.†     66,295       42,966  
                         
        Financial Services — 3.2%                
  1,176     Intercontinental Exchange Inc.     157,124       132,982  
  504     NASDAQ Inc.     32,895       25,125  
              190,019       158,107  
        General Industrial Machinery & Equipment — 2.8%                
  3,200     Matthews International Corp., Cl. A     114,103       136,384  
                         
        Industrial Instruments For Measurement, Display, and Control — 2.1%                
  1,407     Fortive Corp.     104,370       105,201  
                         
        Measuring & Controlling Devices, NEC — 5.4%                
  800     Rockwell Automation Inc.     223,478       263,560  
                         
        Metal Cans — 4.7%                
  975     Agnico Eagle Mines Ltd.     50,140       48,731  
  5,093     Barrick Gold Corp.     96,175       86,224  
  2,225     Newmont Corp.     101,104       94,919  
              247,419       229,874  
        Prepackaged Software — 10.5%                
  400     Aspen Technology Inc.†     71,486       67,044  
  1,149     Check Point Software Technologies Ltd.†     132,338       144,337  
  7,044     N-able Inc.†     77,376       101,504  
  896     Oracle Corp.     78,384       106,705  
  648     PTC Inc.†     79,201       92,210  
              438,785       511,800  
        Pumps & Pumping Equipment — 2.4%                
  1,259     ITT Inc.     131,118       117,351  

 

See accompanying notes to financial statements.

 

8

 

 

Gabelli Automation ETF

Schedule of Investments (Continued) — June 30, 2023 (Unaudited)

 

 

Shares         Cost     Market
Value
 
        COMMON STOCKS (Continued)                
        Wholesale-Durable Goods — 2.5%                
  152     WW Grainger Inc.   $ 79,128     $ 119,866  
                         
        TOTAL INVESTMENTS — 77.5%   $ 3,816,302       3,789,630  
                         
        Other Assets and Liabilities (Net) — 22.5%             1,097,579  
                         
        NET ASSETS — 100.0%           $ 4,887,209  

 

 
Non-income producing security.

 

See accompanying notes to financial statements.

 

9

 

 

Gabelli Automation ETF

 

Statement of Assets and Liabilities

June 30, 2023 (Unaudited)

 

 

Assets:        
Investments at value (cost $3,816,302)   $ 3,789,630  
Cash     1,096,317  
Receivable from Adviser     33  
Dividends receivable     1,229  
Total Assets     4,887,209  
Liabilities:        
Total Liabilities      
Net Assets   $ 4,887,209  
Net Assets Consist of:        
Paid-in capital   $ 5,244,383  
Total accumulated loss     (357,174 )
Net Assets   $ 4,887,209  
         
Shares of Beneficial Interest issued and outstanding, no par value; unlimited number of shares authorized:     210,000
Net Asset Value per share:   $ 23.27  

Statement of Operations

For the Six Months Ended June 30, 2023 (Unaudited)

 

 

Investment Income:        
Dividends (net of foreign withholding taxes of $1,762)   $ 18,996  
Total Investment Income     18,996  
Expenses:        
Investment advisory fees     20,582  
Total Expenses     20,582  
Less:        
Expenses waived by Adviser (See Note 3)     (20,582 )
Net Expenses      
Net Investment Income     18,996  
         
Net Realized and Unrealized Gain/(Loss) on Investments        
Net realized loss on investments     (248,158 )
Net change in unrealized appreciation on investments     737,152  
Net Realized and Unrealized Gain on Investments     488,994  
Net Increase in Net Assets Resulting from Operations   $ 507,990  

 

See accompanying notes to financial statements.

 

10

 

 

Gabelli Automation ETF

Statement of Changes in Net Assets

 

 

    Six Months Ended
June 30,
2023
    For the
Period Ended
December 31,
 
    (Unaudited)     2022(a)  
Operations:                
Net investment income   $ 18,996     $ 34,135  
Net realized loss on investments     (248,158 )     (101,430 )
Net change in unrealized appreciation/(depreciation) on investments     737,152       (763,824 )
Net Increase/(Decrease) in Net Assets Resulting from Operations     507,990       (831,119 )
                 
Distributions to Shareholders:                
Accumulated earnings           (34,045 )
Total Distributions to Shareholders           (34,045 )
                 
Shares of Beneficial Interest Transactions:                
Proceeds from sales of shares (See Note 6)           5,244,383  
Net Increase in Net Assets from Shares of Beneficial Interest Transactions         5,244,383  
                 
Net Increase in Net Assets     507,990       4,379,219  
                 
Net Assets:                
Beginning of period     4,379,219        
End of period   $ 4,887,209     $ 4,379,219  
                 
Changes in Shares Outstanding:                
Shares outstanding, beginning of period     210,000        
Shares sold           210,000  
Shares outstanding, end of period     210,000       210,000  

 

 
(a) The Fund commenced investment operations on January 5, 2022. The Fund first sold shares on January 3, 2022.

 

See accompanying notes to financial statements.

 

11

 

 

Gabelli Automation ETF

Financial Highlights

 

 

Selected data for a share of beneficial interest outstanding throughout the period:

 

    Six Months Ended
June 30,
2023
(Unaudited)
    Period Ended
December 31,
2022(a)
 
Operating Performance:                
Net Asset Value, Beginning of Period   $ 20.85     $ 25.00  
Net Investment Income(b)     0.09       0.16  
Net Realized and Unrealized Gain/(Loss) on Investments     2.33       (4.15 )
Total from Investment Operations     2.42       (3.99 )
                 
Distributions to Shareholders:                
Net Investment Income           (0.16 )
                 
Net Asset Value, End of Period   $ 23.27     $ 20.85  
NAV total return†     11.60 %     (15.90 )%
Market price, End of Period   $ 23.28     $ 20.86  
Investment total return††     11.60 %     (15.90 )%
Net Assets, End of Period (in 000’s)   $ 4,887     $ 4,379  
                 
Ratio to average net assets of:                
Net Investment Income     0.83 %(c)     0.78 %(c)
Operating Expenses Before Waiver     0.90 %(c)     0.90 %(c)
Operating Expenses Net of Waiver     0.00 %(c)     0.00 %(c)
Portfolio Turnover Rate     14 %     28 %

 

 
Total return represents aggregate total return of a hypothetical investment at the beginning of the period and sold at the end of the period. Total return for a period of less than one year is not annualized.
†† Based on market price per share. Total return for a period of less than one year is not annualized.
(a) The Fund commenced investment operations on January 5, 2022. The Fund first sold shares on January 3, 2022.
(b) Per share data are calculated using the average shares outstanding method.
(c) Annualized.

 

See accompanying notes to financial statements.

 

12

 

 

Gabelli Automation ETF

Notes to Financial Statements (Unaudited)

 

 

1. Organization. The Gabelli ETFs Trust (the Trust) was organized on July 26, 2018 as a Delaware statutory trust and Gabelli Automation ETF (the Fund) commenced investment operations on January 5, 2022. The Fund is a non-diversified open-end management investment company registered under the Investment Company Act of 1940, as amended (the 1940 Act). The Fund is an actively managed ETF, whose investment objective is to seek a high level of total return on its assets with an emphasis on income.

 

2. Significant Accounting Policies. As an investment company, the Fund follows the investment company accounting and reporting guidance, which is part of U.S. generally accepted accounting principles (GAAP) that may require the use of management estimates and assumptions in the preparation of its financial statements. Actual results could differ from those estimates. The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements.

 

The global outbreak of the novel coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions, and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may materially impact the value and performance of the Fund, its ability to buy and sell fund investments at appropriate valuations, and its ability to achieve its investment objectives.

 

Security Valuation. Portfolio securities listed or traded on a nationally recognized securities exchange or traded in the U.S. over-the-counter market for which market quotations are readily available are valued at the last quoted sale price or a market’s official closing price as of the close of business on the day the securities are being valued. If there were no sales that day, the security is valued at the average of the closing bid and asked prices or, if there were no asked prices quoted on that day, then the security is valued at the closing bid price on that day. If no bid or asked prices are quoted on such day, the security is valued at the most recently available price or, if the Board of Trustees (the Board) so determines, by such other method as the Board shall determine in good faith to reflect its fair market value. Portfolio securities traded on more than one national securities exchange or market are valued according to the broadest and most representative market, as determined by Gabelli Funds, LLC (the Adviser).

 

Securities and assets for which market quotations are not readily available are fair valued as determined by the Board. Fair valuation methodologies and procedures may include, but are not limited to: analysis and review of available financial and non-financial information about the company; comparisons with the valuation and changes in valuation of similar securities, including a comparison of foreign securities with the equivalent U.S. dollar value American Depositary Receipt securities at the close of the U.S. exchange; and evaluation of any other information that could be indicative of the value of the security.

 

The inputs and valuation techniques used to measure fair value of the Fund’s investments are summarized into three levels as described in the hierarchy below:

 

Level 1 — quoted prices in active markets for identical securities;

 

Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.); and

 

Level 3 — significant unobservable inputs (including the Board’s determinations as to the fair value of investments).

 

A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input both individually and in the aggregate that is significant to the fair value measurement. The inputs or methodology

 

13

 

 

Gabelli Automation ETF

Notes to Financial Statements (Unaudited) (Continued)

 

 

used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. The summary of the Fund’s investments in securities by inputs used to value the Fund’s investments as of June 30, 2023 is as follows:

 

    Valuation Inputs  
    Level 1
Quoted Prices
    Total Market Value
at 06/30/23
 
INVESTMENTS IN SECURITIES:                
ASSETS (Market Value):                
Common Stocks (a)   $ 3,789,630     $ 3,789,630  
TOTAL INVESTMENTS IN SECURITIES - ASSETS   $ 3,789,630     $ 3,789,630  

 

 
(a) Please refer to the Schedule of Investments for the industry classifications of these portfolio holdings.

 

There were no Level 2 or Level 3 investments held at June 30, 2023 or December 31, 2022.

 

Additional Information to Evaluate Qualitative Information

 

General. The Fund uses recognized industry pricing services – approved by the Board and unaffiliated with the Adviser to value most of its securities, and uses broker quotes provided by market makers of securities not valued by these and other recognized pricing sources. Several different pricing feeds are received to value domestic equity securities, international equity securities, preferred equity securities, and fixed income securities. The data within these feeds are ultimately sourced from major stock exchanges and trading systems where these securities trade. The prices supplied by external sources are checked by obtaining quotations or actual transaction prices from market participants. If a price obtained from the pricing source is deemed unreliable, prices will be sought from another pricing service or from a broker/dealer that trades that security or similar securities.

 

Fair Valuation. Fair valued securities may be common and preferred equities, warrants, options, rights, and fixed income obligations. Where appropriate, Level 3 securities are those for which market quotations are not available, such as securities not traded for several days, or for which current bids are not available, or which are restricted as to transfer. When fair valuing a security, factors to consider are recent prices of comparable securities that are publicly traded, reliable prices of securities not publicly traded, and the use of valuation models, current analyst reports, valuing the income or cash flow of the issuer, or cost if the preceding factors do not apply. A significant change in the unobservable inputs could result in a lower or higher value in Level 3 securities. The circumstances of Level 3 securities are frequently monitored to determine if fair valuation measures continue to apply.

 

The Adviser reports quarterly to the Board the results of the application of fair valuation policies and procedures. These may include back testing the prices realized in subsequent trades of these fair valued securities to fair values previously recognized.

 

Foreign Taxes. The Fund may be subject to foreign taxes on income, gains on investments, or currency repatriation, a portion of which may be recoverable. The Fund will accrue such taxes and recoveries as applicable, based upon its current interpretation of tax rules and regulations that exist in the markets in which it invests.

 

Securities Transactions and Investment Income. Securities transactions are accounted for on the trade date with realized gain/(loss) on investments determined by using the identified cost method. Interest income

 

14

 

 

Gabelli Automation ETF

Notes to Financial Statements (Unaudited) (Continued)

 

 

(including amortization of premium and accretion of discount) is recorded on an accrual basis. Premiums and discounts on debt securities are amortized using the effective yield to maturity method. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities that are recorded as soon after the ex-dividend date as the Fund becomes aware of such dividends.

 

Distributions to Shareholders. Distributions to shareholders are recorded on the ex-dividend date. Distributions to shareholders are based on income and capital gains as determined in accordance with federal income tax regulations, which may differ from income and capital gains as determined under GAAP. These differences are primarily due to differing treatments of income and gains on various investment securities held by a fund and timing differences. These book/tax differences are either temporary or permanent in nature. To the extent these differences are permanent, adjustments are made to the appropriate capital accounts in the period when the differences arise. These reclassifications have no impact on the NAV of the Fund.

 

The tax character of distributions paid during the period ended December 31, 2022 was as follows:

 

    Period Ended
December 31,
2022
 
Distributions paid from:        
Ordinary income   $ 34,045  
Total distributions paid   $ 34,045  

 

Provision for Income Taxes. The Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended (the Code). It is the policy of the Fund to comply with the requirements of the Code applicable to regulated investment companies and to distribute substantially all of the Fund’s net investment company taxable income and net capital gains on an annual basis. Therefore, no provision for federal income taxes is required.

 

The following summarizes the tax cost on investments and the net unrealized depreciation at June 30, 2023:

 

    Cost     Gross
Unrealized
Appreciation
    Gross
Unrealized
Depreciation
    Net
Unrealized
Depreciation
 
Investments   $ 3,816,302     $ 288,356     $ (315,028 )   $ (26,672 )

 

The Fund is required to evaluate tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether the tax positions are “more-likely-than-not” of being sustained by the applicable tax authority. Income tax and related interest and penalties would be recognized by the Fund as tax expense in the Statement of Operations if the tax positions were deemed not to meet the more-likely-than-not threshold. For the six months ended June 30, 2023, the Fund did not incur any income tax, interest, or penalties. The Fund’s federal and state tax returns will remain open and subject to examination for three years. On an ongoing basis, the Adviser will monitor the Fund’s tax positions to determine if adjustments to these conclusions are necessary.

 

3. Investment Advisory Agreement and Other Transactions. Pursuant to an Investment Advisory Agreement with the Trust, the Adviser manages the investments of the Fund’s assets. Under the Investment Advisory Agreement, the Fund will pay the Adviser a fee, computed daily and paid monthly, at the annual rate of 0.90% of the value of its average daily net assets and the Adviser is responsible for substantially all expenses of the Fund, except (i) interest and taxes; (ii) brokerage commissions and other expenses connected with the execution of portfolio transactions; (iii) distribution fees; (iv) the advisory fee payable to the Adviser; and (v) litigation expenses and any extraordinary expenses.

 

15

 

 

Gabelli Automation ETF

Notes to Financial Statements (Unaudited) (Continued)

 

 

The Adviser has contractually agreed to waive its investment advisory fee of 0.90% on the first $25 million in net assets (the Fee Waiver). The Fee Waiver will continue until at least April 30, 2024 and shall not apply to any brokerage costs, acquired Fund fees and expenses, interest, taxes, and extraordinary expenses that the Fund may incur. This agreement may be terminated only by, or with the consent of, the Fund’s Board of Trustees.

 

During the six months ended June 30, 2023, the Adviser waived expenses in the amount of $20,582.

 

4. Portfolio Securities. Purchases and sales of securities during the six months ended June 30, 2023, other than short term securities and U.S. Government obligations, aggregated $510,521 and $479,966, respectively.

 

5. Capital Share Transactions. Capital shares are issued and redeemed by the Fund only in aggregations of a specified number of shares or multiples thereof (Creation Units) at NAV, in return for securities, other instruments, and/or cash (the Basket). Except when aggregated in Creation Units, shares of the Fund are not redeemable. Transactions in capital shares of the Fund are disclosed in detail in the Statement of Changes in net assets. Purchasers and redeemers of Creation Units are charged a transaction fee to cover the estimated cost to the Fund of processing the purchase or redemption, including costs charged to it by the NSCC (National Securities Clearing Corporation) or DTC (Depository Trust Company), and the estimated transaction costs, e.g., brokerage commissions, bid-ask spread, and market impact trading costs, incurred in converting the Basket to or from the desired portfolio composition. The transaction fee is determined daily and will be limited to amounts approved by the Board and determined by the Adviser to be appropriate to defray the expenses that the Fund incurs in connection with the purchase or redemption. The purpose of transaction fees is to protect the Fund’s existing shareholders from the dilutive costs associated with the purchase and redemption of Creation Units. The amount of transaction fees will differ depending on the estimated trading costs for portfolio positions and Basket processing costs and other considerations. Transaction fees may include fixed amounts per creation or redemption transactions, amounts varying with the number of Creation Units purchased or redeemed, and varying amounts based on the time an order is placed. The Fund may impose higher transaction fees when cash is substituted for Basket instruments. Higher transaction fees may apply to purchases and redemptions through the DTC than through the NSCC.

 

6. Transactions with Affiliates and Other Arrangements. During the six months ended June 30, 2023, the Fund paid $4 in brokerage commissions on security trades to G.research, LLC, an affiliate of the Adviser.

 

The Adviser pays retainer and per meeting fees to Trustees not affiliated with the Adviser, plus specified amounts to the Lead Director and Audit Committee Chairman. Trustees are also reimbursed for out of pocket expenses incurred in attending meetings. Trustees who are directors or employees of the Adviser or an affiliated company receive no compensation or expense reimbursement from the Trust.

 

7. Significant Shareholder. As of June 30, 2023, the Fund’s Adviser and its affiliates beneficially owned 97.3% of the voting securities of the Fund.

 

8. Indemnifications. The Fund enters into contracts that contain a variety of indemnifications. The Fund’s maximum exposure under these arrangements is unknown. However, the Fund has not had prior claims or losses pursuant to these contracts. Management has reviewed the Fund’s existing contracts and expects the risk of loss to be remote.

 

16

 

 

Gabelli Automation ETF

Notes to Financial Statements (Unaudited) (Continued)

 

 

9. Subsequent Events. Management has evaluated the impact on the Fund of all subsequent events occurring through the date the financial statements were issued and has determined that there were no subsequent events requiring recognition or disclosure in the financial statements.

 

17

 

 

Gabelli Automation ETF

One Corporate Center

Rye, NY 10580-1422

 

Portfolio Management Team Biographies

 

Justin Bergner, CFA, is a Vice President at Gabelli & Company and a portfolio manager for Gabelli Funds LLC, the adviser. Justin rejoined Gabelli & Company in 2013 as a research analyst covering diversified industrials, Home Improvement, and Transport Companies. He began his investment carrier at Gabelli & Company in 2005 as a metals and mining analyst, and subsequently spent five years at Axiom International Investors as a senior analyst focused on industrial and healthcare stocks. Prior to business school, Mr. Bergner worked in management consulting at both Bain & Company and Dean & Company. Mr. Bergner graduated cum laude from Yale University with a BA in Economics & Mathematics and received an MBA in Finance and Accounting from the Wharton School at the University of Pennsylvania.

 

Brett Kearney, CFA, is a portfolio manager covering industrials with a focus on the flow control and other niche manufacturing sectors. He joined the Firm in 2017. Previously he was an analyst at Schultze Asset Management, an analyst at Fidus Mezzanine Capital, and an investment analyst at the Bond & Corporate Finance Group of John Hancock Financial Services. Brett graduated cum laude with a BS in Business Administration from Washington and Lee University and holds an MBA from Columbia Business School, where he participated in the school’s value investing program.

 

Hendi Susanto joined Gabelli in 2007 as the lead technology research analyst. He spent his early career in supply chain management consulting and operations in the technology industry. He currently is a portfolio manager of Gabelli Funds, LLC and a vice president of Associated Capital Group Inc. Mr. Susanto received a BS degree summa cum laude from the University of Minnesota, an MS from Massachusetts Institute of Technology, and an MBA degree from the Wharton School of Business.

 

 

 

 

 

 

 

 

 

 

We have separated the portfolio managers’ commentary from the financial statements and investment portfolio due to corporate governance regulations stipulated by the Sarbanes-Oxley Act of 2002. We have done this to ensure that the contents of the portfolio managers’ commentary are unrestricted. Both the commentary and the financial statements, including the portfolios of investments, will be available on our website at www.gabelli.com.

 

 

 

 

           
 

GABELLI ETFS TRUST

GABELLI AUTOMATION ETF

One Corporate Center

Rye, New York 10580-1422

   
       
  t   800-GABELLI (800-422-3554)    
  f   914-921-5118    
  e  [email protected]    
      GABELLI.COM    
           
 

Net Asset Values per share available daily by calling

800-GABELLI after 7:00 P.M.

   
 

BOARD OF TRUSTEES

Christopher J. Marangi

Managing Director and

Co-Chief Investment Officer,

GAMCO Investors, Inc.

Portfolio Manager for Gabelli

Funds, LLC

 

John Birch

Partner,

The Cardinal Partners Global

 

Anthony S. Colavita

Attorney,

Anthony S. Colavita, P.C.

 

Michael J. Ferrantino

Chief Executive Officer,

InterEx Inc.

 

Leslie F. Foley

Attorney

 

Michael J. Melarkey

Of Counsel,

McDonald Carano Wilson LLP

 

Agnes Mullady

Former Senior Vice President,

GAMCO Investors, Inc.

 

Kuni Nakamura

President,

Advanced Polymer, Inc.

 

Salvatore J. Zizza

Chairman,

Zizza & Associates Corp.

 

OFFICERS

John C. Ball

President & Treasurer

 

Peter Goldstein

Secretary & Vice President

 

Richard J. Walz

Chief Compliance Officer

 

DISTRIBUTOR

G.distributors, LLC

 

CUSTODIAN, TRANSFER

AGENT, AND DIVIDEND

DISBURSING AGENT

The Bank of New York

Mellon

 

LEGAL COUNSEL

Paul Hastings LLP

   
                   
  This report is submitted for the general information of the shareholders of Gabelli Automation ETF. It is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus.    
           
           
           
  GAST Q2/2023        

 

 

 

 

Gabelli Financial Services Opportunities ETF

Semiannual Report June 30, 2023

 

Macrae Sykes

Portfolio Manager

BA, Hamilton College

MBA, Columbia Business School

 

To Our Shareholders,

 

For the six months ended June 30, 2023, the net asset value (NAV) total return of Gabelli Financial Services Opportunities ETF (the Fund) was 14.4% compared with a total return of (0.5)% for the Standard & Poor’s (S&P) 500 Financials Index. The total return based on the Fund’s Market Price was 14.6%. The Fund’s NAV per share was $28.34, while the price of the publicly traded shares closed at $28.39 on the New York Stock Exchange (NYSE) Arca. See page 4 for additional performance information.

 

Enclosed are the financial statements, including the schedule of investments, for the Fund’s semiannual report as of June 30, 2023.

 

 

 

 

 

 

 

 

 

 

As permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund’s annual and semiannual shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports. Instead, the reports will be made available on the Fund’s website www.gabelli.com/funds/etfs, and you will be notified by mail each time a report is posted and provided with a website link to access the report. If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. To elect to receive all future reports on paper free of charge, please contact your financial intermediary, or, if you invest directly with the Fund, you may call 800-422-3554 or send an email request to [email protected].

 

 

 

 

Investment Objective and Strategy (Unaudited)

 

The Fund seeks to provide capital appreciation.

 

Under normal market conditions, the Fund invests at least 80% of the value of its net assets, in the securities of companies principally engaged in the group of industries comprising the financial services sector. As a fundamental policy, the Fund will concentrate (invest at least 25% of the value of its net assets) in the securities of companies principally engaged in the group of industries comprising the financial services sector. The Fund may invest in the equity securities of such companies, such as common stock, or preferred stock of such companies in accordance with the foregoing 80% policy. The Fund may also invest in foreign securities by investing in American Depositary Receipts. The Fund may invest in companies without regard to market capitalization.

 

The Fund considers a company to be principally engaged in the group of industries comprising the financial services sector if it devotes a significant portion of its assets to, or derives a significant portion of its revenues from, providing financial services. The Fund considers a company to be principally engaged in the group of industries comprising the financial services sector if it devotes 50% of its assets to, or derives 50% of its revenues from, providing financial services. Such services include but are not limited to the following: commercial, consumer, and specialized banking and financing; asset management; publicly-traded, government sponsored financial enterprises; insurance; accountancy; mortgage REITs; brokerage; securities exchanges and electronic trading platforms; financial data, technology, and analysis; and financial transaction and other financial processing services.

 

Performance Discussion (Unaudited)

 

Although the broader markets trended higher in the first half, the start of the year brought new surprises and uncertainty. The most notable of the headline events was the failure of major firms Silicon Valley “SVB” and Signature Bank. It is worth noting that between 2001 to early 2023 there have been 562 bank failures (~26 per year). Apparently, it does happen and it will occur again in the future. In SVB’s case, the loss of confidence in the institution was exacerbated by deposit clients who were particularly linked to the venture capital community and influenced by a more concentrated group of institutions. The answer to the stress, determined over a weekend by the regulatory agencies, was to take over the bank, back-stop the deposits, and work to put control in a larger institution. Of course, there will be much examination and potential regulatory changes but, as Jamie Dimon said in in his annual letter, “Simply taking interest rate risk (which contributed to the downfall of SVB) is not a business.”

 

While the Fund does own select bank stocks, it is not a bank fund. In our opinion, some bank stocks will do well, but in general, there remain headwinds in terms of the inverted yield curve, potentially worsening credit conditions, and change in regulations, all of which will make it more challenging to predict ROEs in the future. At the present time, we see better opportunity in more scaled institutions and in those with diverse revenue streams from asset and wealth management, capital markets, and investment banking. Additionally, we believe these major, branded firms will see less impact on net interest margins from rising funding costs due to more favorable exposure to non-interest bearing deposits and operating checking accounts.

 

Included in the fund’s title is the word “opportunities,” which was intentioned to highlight the strategy’s ability to take advantage of a diverse set of companies and secular tailwinds. According to the Federal Reserve, total wealth has more than tripled to $140 trillion in 2022 from 1989. The ~$80 trillion that is held by “Baby Boomers” will pass to the next generations through 2045, including approximately $16 trillion in the next decade or an

 

2

 

 

average of $1.6 trillion per year. By comparison, the current bipartisan plans are to increase fiscal stimulus by ~$1.2 trillion on infrastructure over the next several years. So we see no let-up in demand for financial advice or innovation related to supporting this significant economic transfer.

 

Just 4% of institutional asset allocations are to alternatives according to data from State Street Global Advisors. Investment performance at the top firms has been strong and the asset class offers benefits through diversification. Going forward we expect a further increase in the allocated percentage as well as increased penetration to retail channels. Just a 1% shift is equivalent to trillions in investment funds and we believe industry leaders, Blackstone (NYSE: BX) ($1 trillion of AUM) and Apollo (NYSE: APO) ($600 billion of AUM) are well positioned to capture global share. Another favorite topic in the press has been the upcoming age of “Artificial Intelligence.” In some cases this quarter, technology companies, considered leaders in the field of AI, appreciated on the back of this “new” investor enthusiasm. It is worth noting that AI has been around for some time though. WAZE (founded in 2006) was one of the first applications to combine big, fluid data and provide predictive algorithms for road navigation. JP Morgan Bank (NYSE: JPM) was founded in 1799 and today operates similar banking functions to its original charter company in terms of taking deposits, making loans and providing safe custody of assets. From that smaller platform, it has evolved into a global diversified institution, which generated $38 billion of net income in 2022. Ingrained in management’s capital allocation ethos has been a keen focus on technology spending to drive efficiency, improve client engagement and enable further scale ($3.8 trillion of client assets). 

 

In 2023, the company expects to spend $7.2 billion on technology investments or greater than 2x the revenue of cloud provider, Snowflake (NASDAQ: SNOW). JP Morgan was the first bank to offer an AI-powered virtual assistant for corporate clients to move money around the world. Net/net, for those that are worried about missing this latest fundamental trend, they should remain confident that financial services firms like JP Morgan will use it to good advantage.

 

 

 

 

 

 

 

 

 

 

The views expressed reflect the opinions of the Fund’s portfolio manager and Gabelli Funds, LLC, the Adviser, as of the date of this report and are subject to change without notice based on changes in market, economic, or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

 

3

 

 

Comparative Results

 

 

Cumulative Returns through June 30, 2023 (Unaudited)

 

Total returns and cumulative returns reflect changes in share price, reinvestment of distributions, and are net of expenses. Performance returns for periods of less than one year are not annualized.

 

                Since  
                Inception  
    Six Months     One Year     (5/09/22) (a)  
Gabelli Financial Services Opportunities ETF (GABF)                        
NAV Total Return     14.40 %     21.39 %     12.94 %
Investment Total Return (b)     14.61       21.91       13.12  
S&P 500 Financials Index (c)     (0.53 )     9.50       1.86  

 

 
(a) GABF first issued shares May 9, 2022, and shares commenced trading on the NYSE Arca May 10, 2022.
(b) Investment total returns are based on the closing market price on the NYSE Arca at the end of the period.
(c) The S&P 500 Financials Index comprises companies included in the S&P 500 that are classified as members of the financials sector. Dividends are considered reinvested. You cannot invest directly in an index.

 

In the current prospectus of Gabelli Financial Services Opportunities ETF dated April 28, 2023, the gross expense ratio for the Fund is 0.94%. The net expense ratio for the Fund after contractual expense waiver by Gabelli Funds, LLC (the Adviser) is 0.04%. The waiver is in effect through April 30, 2024. Investors should carefully consider the investment objectives, risks, sales charges, and expenses of the Fund before investing. The prospectus contains information about these and other matters and should be read carefully before investing. To obtain a prospectus, please visit our website at www.gabelli.com/funds/etfs.

 

Returns represent past performance and do not guarantee future results. Investment returns and the principal value of an investment will fluctuate. When shares are sold they may be worth more or less than their original cost. Current performance may be lower or higher than the performance data presented. Visit www.gabelli.com/funds/etfs for performance information as of the most recent month end.

 

 

4

 

 

Discount & Premium Information

 

Information regarding how often shares of the Fund traded on the New York Stock Exchange Arca at a price above, i.e., at a premium, or below, i.e., at a discount, the NAV can be found at www.gabelli.com/funds/etfs.

 

Information showing the Fund’s net asset value, market price, premiums and discounts, and bid-ask spreads for various time periods is available by visiting the Fund’s website at www.gabelli.com/funds/etfs.

 

This ETF is different from traditional ETFs. Traditional ETFs tell the public what assets they hold each day. This ETF will not. This may create additional risks for your investment. For example:

 

You may have to pay more money to trade the ETF’s shares. This ETF will provide less information to traders, who tend to charge more for trades when they have less information.

 

The price you pay to buy ETF shares on an exchange may not match the value of the ETF’s portfolio. The same is true when you sell shares. These price differences may be greater for this ETF compared with other ETFs because it provides less information to traders.

 

These additional risks may be even greater in bad or uncertain market conditions.

 

The differences between this ETF and other ETFs may also have advantages. By keeping certain information about the ETF secret, this ETF may face less risk that other traders can predict or copy its investment strategy. This may improve the ETF’s performance. If other traders are able to copy or predict the ETF’s investment strategy, however, this may hurt the ETF’s performance. For additional information regarding the unique attributes and risks of the ETF, see the Active Shares prospectus/registration statement.

 

5

 

 

Gabelli Financial Services Opportunities ETF

Disclosure of Fund Expenses (Unaudited)

For the Six Months Period from January 1, 2023 through June 30, 2023 Expense Table
 

 

We believe it is important for you to understand the impact of fees and expenses regarding your investment. All funds have operating expenses. As a shareholder of a fund, you incur two types of costs, transaction costs, which include brokerage commissions on purchases and sales of fund shares, and ongoing costs, which include costs for portfolio management, administrative services, and shareholder reports (like this one), among others. Operating expenses, which are deducted from a fund’s gross income, directly reduce the investment return of a fund. When a fund’s expenses are expressed as a percentage of its average net assets, this figure is known as the expense ratio. The following examples are intended to help you understand the ongoing costs (in dollars) of investing in your Fund and to compare these costs with those of other funds. The examples are based on an investment of $1,000 made at the beginning of the period shown and held for the entire period.

 

The Expense Table below illustrates your Fund’s costs in two ways:

 

Actual Fund Return: This section provides information about actual account values and actual expenses. You may use this section to help you to estimate the actual expenses that you paid over the period after any fee waivers and expense reimbursements. The “Ending Account Value” shown is derived from the Fund’s actual return during the past six months ended June 30, 2023, and the “Expenses Paid During Period” shows the dollar amount that would have been paid by an investor who started with $1,000 in the Fund. You may use this information, together with the amount you invested, to estimate the expenses that you paid over the period.

 

To do so, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number given for your Fund under the heading “Expenses Paid During Period” to estimate the expenses you paid during this period.

 

Hypothetical 5% Return: This section provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio. It assumes a hypothetical annualized return of 5% before expenses during the period shown. In this case – because the hypothetical return used is not the Fund’s actual return – the results do

not apply to your investment and you cannot use the hypothetical account value and expense to estimate the actual ending account balance or expenses you paid for the period. This example is useful in making comparisons of the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in shareholder reports of other funds.

 

Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs such as sales charges (loads), redemption fees, or exchange fees, if any, which would be described in the Prospectus. If these costs were applied to your account, your costs would be higher. Therefore, the 5% hypothetical return is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.

 

    Beginning
Account Value
01/01/23
    Ending
Account Value
06/30/23
    Annualized
Expense
Ratio
    Expenses
Paid During
Period*
 
Gabelli Financial Services Opportunities ETF
Actual Fund Return                              
    $ 1,000.00     $ 1,144.00     0.00%     $ 0.00  
Hypothetical 5% Return
    $ 1,000.00     $ 1,024.79     0.00%     $ 0.00  

 

 
* Expenses are equal to the Fund’s annualized expense ratio for the last six months multiplied by the average account value over the period, multiplied by the number of days in the most recent fiscal half year (181 days), then divided by 365.

 

6

 

 

Summary of Portfolio Holdings (Unaudited)

 

The following table presents portfolio holdings as a percent of net assets as of June 30, 2023:

 

GABELLI FINANCIAL SERVICES OPPORTUNITIES ETF

 

Financial Services     72.6 %
Banking     11.0 %
Leasing     7.1 %
Computer Software and Services     5.5 %
Asset Management     2.5 %
Other Assets and Liabilities (Net)     1.3 %
      100.0 %

 

The Fund files a complete schedule of portfolio holdings with the Securities and Exchange Commission (the SEC) for the first and third quarters of each fiscal year on Form N-PORT. Shareholders may obtain this information at www.gabelli.com or by calling the Fund at 800-GABELLI (800-422-3554). The Fund’s Form N-PORT is available on the SEC’s website at www.sec.gov and may also be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 800-SEC-0330.

 

Proxy Voting

 

The Fund files Form N-PX with its complete proxy voting record for the twelve months ended June 30, no later than August 31 of each year. A description of the Fund’s proxy voting policies, procedures, and how each Fund voted proxies relating to portfolio securities is available without charge, upon request, by (i) calling 800-GABELLI (800-422-3554); (ii) writing to The Gabelli Funds at One Corporate Center, Rye, NY 10580-1422; or (iii) visiting the SEC’s website at www.sec.gov.

 

7

 

 

Gabelli Financial Services Opportunities ETF

Schedule of Investments — June 30, 2023 (Unaudited)

 

 

                Market  
Shares         Cost     Value  
        COMMON STOCKS — 98.7%  
        Asset Management — 2.5%  
  1,100     Affiliated Managers Group Inc.   $ 173,077‌     $ 164,879‌  
                         
        Banking — 11.0%  
  7,000     Bank of America Corp.     234,146‌       200,830‌  
  150     Capital One Financial Corp.     18,158‌       16,406‌  
  500     Citizens Financial Group Inc.     18,037‌       13,040‌  
  265     First Citizens BancShares Inc., Cl. A     152,964‌       340,114‌  
  1,000     State Street Corp.     62,491‌       73,180‌  
  2,000     The Bank of New York Mellon Corp.     86,441‌       89,040‌  
              572,237‌       732,610‌  
        Computer Software and Services — 5.5%  
  400     FactSet Research Systems Inc.     147,232‌       160,260‌  
  1,600     Fiserv Inc.†     187,172‌       201,840‌  
              334,404‌       362,100‌  
        Financial Services — 72.6%  
  1,600     American Express Co.     250,647‌       278,720‌  
  4,000     Apollo Global Management Inc.     279,793‌       307,240‌  
  1,450     Berkshire Hathaway Inc.,Cl. B†     440,535‌       494,450‌  
  3,400     Blackstone Inc.     312,305‌       316,098‌  
  29,000     Blue Owl Capital Inc.     285,120‌       337,850‌  
  100     Cohen & Steers Inc.     5,744‌       5,799‌  
  5,000     Compass Diversified Holdings     92,782‌       108,450‌  
  1,000     Federated Hermes Inc.     32,870‌       35,850‌  
  2,000     Focus Financial Partners Inc., Cl. A†     65,133‌       105,020‌  
  3,300     Interactive Brokers Group Inc., Cl. A     179,314‌       274,131‌  
  1,500     JPMorgan Chase & Co.     176,671‌       218,160‌  
  100     KKR & Co. Inc.     5,118‌       5,600‌  
  100     Markel Group Inc.†     135,536‌       138,318‌  
  600     Moody’s Corp.     171,358‌       208,632‌  
  2,000     Morgan Stanley     164,161‌       170,800‌  
  1,250     Nasdaq Inc.     62,893‌       62,312‌  
  3,700     Owl Rock Capital Corp.     49,825‌       49,654‌  
  250     PayPal Holdings Inc.†     19,636‌       16,683‌  
  18,500     Paysafe Ltd.†     315,836‌       186,665‌  
  100     Prudential Financial Inc.     9,411‌       8,822‌  
  525     S&P Global Inc.     173,203‌       210,467‌  
                Market  
Shares         Cost     Value  
  22,250     Sculptor Capital Management Inc.   $ 199,184     $ 196,468  
  8,500     Silvercrest Asset Management Group Inc., Cl. A     154,574       172,125  
  650     Starwood Property Trust Inc., REIT     15,737       12,610  
  400     Stifel Financial Corp.     23,605       23,868  
  17,000     StoneCo Ltd., Cl. A†     196,901       216,580  
  500     T Rowe Price Group Inc.     59,392       56,010  
  4,500     The Charles Schwab Corp.     266,570       255,060  
  50     Visa Inc., Cl. A     9,338       11,874  
  3,750     W R Berkley Corp.     233,264       223,350  
  3,000     Wells Fargo & Co.     126,470       128,040  
              4,512,926       4,835,706  
        Leasing — 7.1%
  15,000     FTAI Aviation Ltd.     274,004       474,900  
                         
        TOTAL INVESTMENTS — 98.7%   $ 5,866,648       6,570,195  
                         
        Other Assets and Liabilities (Net) — 1.3%             89,173  
                         
        NET ASSETS — 100.0%           $ 6,659,368  

 

 
Non-income producing security.

 

REIT Real Estate Investment Trust

 

See accompanying notes to financial statements.

 

8

 

 

Gabelli Financial Services Opportunities ETF

 

Statement of Assets and Liabilities

June 30, 2023 (Unaudited)

 

 

Assets:        
Investments at value (cost $5,866,648)   $ 6,570,195‌  
Cash     115,505‌  
Receivable from Adviser     25‌  
Dividends receivable     2,163‌  
Total Assets     6,687,888‌  
Liabilities:        
Distributions payable     28,520‌  
Total Liabilities     28,520‌  
Net Assets   $ 6,659,368‌  
Net Assets Consist of:        
Paid-in capital   $ 5,951,367‌  
Total accumulated earnings     708,001‌  
Net Assets   $ 6,659,368‌  
       
Shares of Beneficial Interest issued and outstanding, no par value; unlimited number of shares authorized:     235,000‌  
Net Asset Value per share:   $ 28.34‌  

Statement of Operations

For the Six Months Ended June 30, 2023 (Unaudited)

 

 

Investment Income:      

Dividends (net of foreign withholding taxes of $193)

  $ 65,469  
Total Investment Income     65,469  
Expenses:        
Investment advisory fees     26,273  
Total Expenses     26,273  
Less:        
Expenses waived by Adviser (See Note 3)     (26,273 )
Net Expenses      
Net Investment Income     65,469  
         
Net Realized and Unrealized Gain/(Loss) on Investments        
Net realized loss on investments     (31,998 )
Net change in unrealized appreciation on investments     733,814  
Net Realized and Unrealized Gain on Investments     701,816  
Net Increase in Net Assets Resulting from Operations   $ 767,285  

 

See accompanying notes to financial statements.

 

9

 

 

Gabelli Financial Services Opportunities ETF

Statement of Changes in Net Assets

 

 

    Six Months Ended
June 30,
2023
(Unaudited)
    For the
Period Ended
December 31,
2022(a)
 
Operations:                
Net investment income   $ 65,469     $ 68,133  
Net realized loss on investments     (31,998 )     (29,280 )
Net change in unrealized appreciation/(depreciation) on investments     733,814       (30,267 )
Net Increase in Net Assets Resulting from Operations     767,285       8,586  
                 
Accumulated earnings           (68,292 )
Total Distributions to Shareholders           (68,292 )
                 
Shares of Beneficial Interest Transactions:                
Proceeds from sales of shares     690,392       5,261,397  
Net Increase in Net Assets from Shares of Beneficial Interest Transactions     690,392       5,261,397  
                 
Net Increase in Net Assets     1,457,677       5,201,691  
                 
Net Assets:                
Beginning of period     5,201,691        
End of period   $ 6,659,368     $ 5,201,691  
                 
Changes in Shares Outstanding:                
Shares outstanding, beginning of period     210,000        
Shares sold     25,000       210,000  
Shares outstanding, end of period     235,000       210,000  

 

 
(a) The Fund commenced investment operations on May 10, 2022. The Fund first sold shares on May 9, 2022.

 

See accompanying notes to financial statements.

 

10

 

 

Gabelli Financial Services Opportunities ETF

Financial Highlights

 

 

Selected data for a share of beneficial interest outstanding throughout the period:

 

    Six Months Ended
June 30,
2023
(Unaudited)
    Period Ended
December 31,
2022(a)
 
Operating Performance:            
Net Asset Value, Beginning of Period   $ 24.77     $ 25.00  
Net Investment Income(b)     0.30       0.33  
Net Realized and Unrealized Gain/(Loss) on Investments     3.27       (0.23 )
Total from Investment Operations     3.57       0.10  
                 
Distributions to Shareholders:                
Net Investment Income           (0.33 )
                 
Net Asset Value,End of Period   $ 28.34     $ 24.77  
NAV total return†     14.40 %     0.41 %
Market price,End of Period   $ 28.39     $ 24.77  
Investment total return††     14.61 %     0.41 %
Net Assets, End of Period (in 000’s)   $ 6,659     $ 5,202  
                 
Ratio to average net assets of:                
Net Investment Income     2.24 %(c)     2.01 %(c)
Operating Expenses Before Waiver     0.90 %(c)     0.90 %(c)
Operating Expenses Net of Waiver     0.00 %(c)     0.00 %(c)
Portfolio Turnover Rate     18 %     72 %

 

 
Total return represents aggregate total return of a hypothetical investment at the beginning of the period and sold at the end of the period. Total return for a period of less than one year is not annualized.
†† Based on market price per share. Total return for a period of less than one year is not annualized.
(a) The Fund commenced investment operations on May 10, 2022. The Fund first sold shares on May 9, 2022.
(b) Per share data are calculated using the average shares outstanding method.
(c) Annualized.

 

See accompanying notes to financial statements.

 

11

 

 

Gabelli Financial Services Opportunities ETF

Notes to Financial Statements

 

 

1. Organization. The Gabelli ETFs Trust (the Trust) was organized on July 26, 2018 as a Delaware statutory trust and Gabelli Financial Services Opportunities ETF (the Fund) commenced investment operations on May 10, 2022. The Fund is a diversified open-end management investment company registered under the Investment Company Act of 1940, as amended (the 1940 Act). The Fund is an actively managed ETF, whose investment objective is to provide capital appreciation.

 

2. Significant Accounting Policies. As an investment company, the Fund follows the investment company accounting and reporting guidance, which is part of U.S. generally accepted accounting principles (GAAP) that may require the use of management estimates and assumptions in the preparation of its financial statements. Actual results could differ from those estimates. The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements.

 

The global outbreak of the novel coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions, and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may materially impact the value and performance of the Fund, its ability to buy and sell fund investments at appropriate valuations, and its ability to achieve its investment objectives.

 

Security Valuation. Portfolio securities listed or traded on a nationally recognized securities exchange or traded in the U.S. over-the-counter market for which market quotations are readily available are valued at the last quoted sale price or a market’s official closing price as of the close of business on the day the securities are being valued. If there were no sales that day, the security is valued at the average of the closing bid and asked prices or, if there were no asked prices quoted on that day, then the security is valued at the closing bid price on that day. If no bid or asked prices are quoted on such day, the security is valued at the most recently available price or, if the Board of Trustees (the Board) so determines, by such other method as the Board shall determine in good faith to reflect its fair market value. Portfolio securities traded on more than one national securities exchange or market are valued according to the broadest and most representative market, as determined by Gabelli Funds, LLC (the Adviser).

 

Securities and assets for which market quotations are not readily available are fair valued as determined by the Board. Fair valuation methodologies and procedures may include, but are not limited to: analysis and review of available financial and non-financial information about the company; comparisons with the valuation and changes in valuation of similar securities, including a comparison of foreign securities with the equivalent U.S. dollar value American Depositary Receipt securities at the close of the U.S. exchange; and evaluation of any other information that could be indicative of the value of the security.

 

The inputs and valuation techniques used to measure fair value of the Fund’s investments are summarized into three levels as described in the hierarchy below:

 

Level 1 — quoted prices in active markets for identical securities;

 

Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.); and

 

Level 3 — significant unobservable inputs (including the Board’s determinations as to the fair value of investments).

 

A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input both individually and in the aggregate that is significant to the fair value measurement. The inputs or methodology

 

12

 

 

Gabelli Financial Services Opportunities ETF

Notes to Financial Statements (Continued)

 

 

used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. The summary of the Fund’s investments in securities by inputs used to value the Fund’s investments as of June 30, 2023 is as follows:

 

    Valuation Inputs  
    Level 1
Quoted Prices
    Total Market Value
at 06/30/23
 
INVESTMENTS IN SECURITIES:            
ASSETS (Market Value):                
Common Stocks (a)   $ 6,570,195     $ 6,570,195  
TOTAL INVESTMENTS IN SECURITIES - ASSETS   $ 6,570,195     $ 6,570,195  

 

 
(a) Please refer to the Schedule of Investments for the industry classifications of these portfolio holdings.

 

There were no Level 2 or Level 3 investments held at June 30, 2023 or December 31, 2022.

 

Additional Information to Evaluate Qualitative Information

 

General. The Fund uses recognized industry pricing services – approved by the Board and unaffiliated with the Adviser to value most of its securities, and uses broker quotes provided by market makers of securities not valued by these and other recognized pricing sources. Several different pricing feeds are received to value domestic equity securities, international equity securities, preferred equity securities, and fixed income securities. The data within these feeds are ultimately sourced from major stock exchanges and trading systems where these securities trade. The prices supplied by external sources are checked by obtaining quotations or actual transaction prices from market participants. If a price obtained from the pricing source is deemed unreliable, prices will be sought from another pricing service or from a broker/dealer that trades that security or similar securities.

 

Fair Valuation. Fair valued securities may be common and preferred equities, warrants, options, rights, and fixed income obligations. Where appropriate, Level 3 securities are those for which market quotations are not available, such as securities not traded for several days, or for which current bids are not available, or which are restricted as to transfer. When fair valuing a security, factors to consider are recent prices of comparable securities that are publicly traded, reliable prices of securities not publicly traded, and the use of valuation models, current analyst reports, valuing the income or cash flow of the issuer, or cost if the preceding factors do not apply. A significant change in the unobservable inputs could result in a lower or higher value in Level 3 securities. The circumstances of Level 3 securities are frequently monitored to determine if fair valuation measures continue to apply.

 

The Adviser reports quarterly to the Board the results of the application of fair valuation policies and procedures. These may include back testing the prices realized in subsequent trades of these fair valued securities to fair values previously recognized.

 

Foreign Taxes. The Fund may be subject to foreign taxes on income, gains on investments, or currency repatriation, a portion of which may be recoverable. The Fund will accrue such taxes and recoveries as applicable, based upon its current interpretation of tax rules and regulations that exist in the markets in which it invests.

 

Securities Transactions and Investment Income. Securities transactions are accounted for on the trade date with realized gain/(loss) on investments determined by using the identified cost method. Interest income

 

13

 

 

Gabelli Financial Services Opportunities ETF

Notes to Financial Statements (Continued)

 

 

(including amortization of premium and accretion of discount) is recorded on an accrual basis. Premiums and discounts on debt securities are amortized using the effective yield to maturity method. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities that are recorded as soon after the ex-dividend date as the Fund becomes aware of such dividends.

 

Distributions to Shareholders. Distributions to shareholders are recorded on the ex-dividend date. Distributions to shareholders are based on income and capital gains as determined in accordance with federal income tax regulations, which may differ from income and capital gains as determined under GAAP. These differences are primarily due to differing treatments of income and gains on various investment securities held by a Fund and timing differences. These book/tax differences are either temporary or permanent in nature. To the extent these differences are permanent, adjustments are made to the appropriate capital accounts in the period when the differences arise. Permanent differences were primarily due to a taxable distribution in excess of net investment income. These reclassifications have no impact on the NAV of the Fund.

 

The tax character of distributions paid during the period ended December 31, 2022 was as follows:

 

    Period Ended
December 31,
2022
 
Distributions paid from:        
Ordinary income   $ 68,292  
Total distributions paid   $ 68,292  

 

Provision for Income Taxes. The Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended (the Code). It is the policy of the Fund to comply with the requirements of the Code applicable to regulated investment companies and to distribute substantially all of the Fund’s net investment company taxable income and net capital gains on an annual basis. Therefore, no provision for federal income taxes is required.

 

The following summarizes the tax cost on investments and the net unrealized appreciation at June 30, 2023:

 

Cost Gross
Unrealized
Appreciation
Gross
Unrealized
Depreciation
Net
Unrealized
Appreciation
Investments   $ 5,871,800     $ 910,771     $ (212,376 )   $ 698,395  

 

The Fund is required to evaluate tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether the tax positions are “more-likely-than-not” of being sustained by the applicable tax authority. Income tax and related interest and penalties would be recognized by the Fund as tax expense in the Statement of Operations if the tax positions were deemed not to meet the more-likely-than-not threshold. For the six months ended June 30, 2023, the Fund did not incur any income tax, interest, or penalties. The Fund’s federal and state tax returns will remain open and subject to examination for three years. On an ongoing basis, the Adviser will monitor the Fund’s tax positions to determine if adjustments to these conclusions are necessary.

 

3. Investment Advisory Agreement and Other Transactions. Pursuant to an Investment Advisory Agreement with the Trust, the Adviser manages the investment of the Fund’s assets. Under the Investment Advisory Agreement, the Fund will pay the Adviser a fee, computed daily and paid monthly, at the annual rate of 0.90% of the value of its average daily net assets and the Adviser is responsible for substantially all expenses of the Fund, except (i) interest and taxes; (ii) brokerage commissions and other expenses connected with the execution

 

14

 

 

Gabelli Financial Services Opportunities ETF

Notes to Financial Statements (Continued)

 

 

of portfolio transactions; (iii) distribution fees; (iv) the advisory fee payable to the Adviser; and (v) litigation expenses and any extraordinary expenses.

 

The Adviser has contractually agreed to waive its investment advisory fee of 0.90% on the first $25 million in net assets (the Fee Waiver). The Fee Waiver will continue until at least April 30, 2024, and shall not apply to any brokerage costs, acquired Fund fees and expenses, interest, taxes, and extraordinary expenses that the Fund may incur. This agreement may be terminated only by, or with the consent of, the Fund’s Board of Trustees.

 

During the period ended June 30, 2023, the Adviser waived expenses in the amount of $26,273.

 

4. Portfolio Securities. Purchases and sales of securities during the period ended June 30, 2023, other than short term securities and U.S. Government obligations, aggregated $1,957,815 and $1,047,422, respectively.

 

5. Capital Share Transactions. Capital shares are issued and redeemed by the Fund only in aggregations of a specified number of shares or multiples thereof (Creation Units) at NAV, in return for securities, other instruments, and/or cash (the Basket). Except when aggregated in Creation Units, shares of the Fund are not redeemable. Transactions in capital shares for the Fund are disclosed in detail in the Statement of Changes in Net Assets. Purchasers and redeemers of Creation Units are charged a transaction fee to cover the estimated cost to the Fund of processing the purchase or redemption, including costs charged to it by the NSCC (National Securities Clearing Corporation) or DTC (Depository Trust Company), and the estimated transaction costs, e.g., brokerage commissions, bid-ask spread, and market impact trading costs, incurred in converting the Basket to or from the desired portfolio composition. The transaction fee is determined daily and will be limited to amounts approved by the Board and determined by the Adviser to be appropriate to defray the expenses that the Fund incurs in connection with the purchase or redemption. The purpose of transaction fees is to protect the Fund’s existing shareholders from the dilutive costs associated with the purchase and redemption of Creation Units. The amount of transaction fees will differ depending on the estimated trading costs for portfolio positions and Basket processing costs and other considerations. Transaction fees may include fixed amounts per creation or redemption transactions, amounts varying with the number of Creation Units purchased or redeemed, and varying amounts based on the time an order is placed. The Fund may impose higher transaction fees when cash is substituted for Basket instruments. Higher transaction fees may apply to purchases and redemptions through the DTC than through the NSCC.

 

6. Transactions with Affiliates and Other Arrangements. During the period ended June 30, 2023, the Fund paid $56 in brokerage commissions on security trades to G.research, LLC, an affiliate of the Adviser.

 

The Adviser pays retainer and per meeting fees to Trustees not affiliated with the Adviser, plus specified amounts to the Lead Trustee and Audit Committee Chairman. Trustees are also reimbursed for out of pocket expenses incurred in attending meetings. Trustees who are directors or employees of the Adviser or an affiliated company receive no compensation or expense reimbursement from the Trust.

 

7. Significant Shareholder. As of June 30, 2023, approximately 88.3% of the Fund was beneficially owned by the Adviser and its affiliates, including managed accounts for which the affiliates of the Adviser have voting control but disclaim pecuniary interest.

 

8. Indemnifications. The Fund enters into contracts that contain a variety of indemnifications. The Fund’s maximum exposure under these arrangements is unknown. However, the Fund has not had prior claims or

 

15

 

 

Gabelli Financial Services Opportunities ETF

Notes to Financial Statements (Continued)

 

 

losses pursuant to these contracts. Management has reviewed the Fund’s existing contracts and expects the risk of loss to be remote.

 

9. Subsequent Events. Management has evaluated the impact on the Fund of all subsequent events occurring through the date the financial statements were issued and has determined that there were no subsequent events requiring recognition or disclosure in the financial statements.

 

16

 

 

GABELLI FINANCIAL SERVICES OPPORTUNITIES ETF

One Corporate Center

Rye, NY 10580-1422

 

Portfolio Manager’s Biography

 

Macrae Sykes joined the firm in 2008 as an analyst focused on financial services. He was ranked #1 investment services analyst by the Wall Street Journal in 2010, was a runner-up in the annual StarMine analyst awards for stock picking in 2014 and 2018, and received several honorable mentions for coverage of brokers and asset managers from Institutional Investor. In 2018, Mac was a contributing author to The Warren Buffet Shareholder: Stories from Inside the Berkshire Hathaway Annual Meeting edited by Lawrence Cunningham and Stephen Cuba. Mac holds a BA in economics from Hamilton College and an MBA degree in Finance from Columbia Business School.

 

 

 

 

 

 

 

 

 

 

We have separated the portfolio manager’s commentary from the financial statements and investment portfolio due to corporate governance regulations stipulated by the Sarbanes-Oxley Act of 2002. We have done this to ensure that the contents of the portfolio managers’ commentary are unrestricted. Both the commentary and the financial statements, including the portfolios of investments, will be available on our website at www.gabelli.com.

 

 

 

 

     <