Gabelli Equity Trust declares $0.15 per share cash distribution.

• Gabelli Equity Trust declares $0.15/share cash distribution for September 23, 2025. • 10% distribution policy reaffirmed. • Based on net asset value fluctuations. • Board of Directors reviews distribution each quarter.

Gabelli Equity Trust (NYSE: GAB) has reaffirmed its 10% distribution policy and declared a quarterly cash distribution of $0.15 per share, payable on September 23, 2025, to shareholders of record as of September 16, 2025 [1]. The Fund maintains a minimum annual distribution of 10% of average net asset value or an amount meeting IRS requirements for regulated investment companies.

The 2025 distributions comprise approximately 4% from net investment income, 26% from net capital gains, and 70% as return of capital on a book basis [1]. The Board of Directors regularly reviews distribution levels considering net asset value and market conditions. Shareholders will receive detailed tax information for 2025 distributions via Form 1099-DIV in early 2026.

The Gabelli Equity Trust, managed by Gabelli Funds, LLC, a subsidiary of GAMCO Investors, Inc. (OTCQX: GAMI), is a diversified, closed-end management investment company with $2.1 billion in total net assets whose primary investment objective is long-term growth of capital [1]. The Fund invests in multiple sectors, including financial services, consumer products, and healthcare.

The distribution structure warrants careful attention. The high return of capital component means the Fund is essentially returning investors' own money rather than distributing profits generated from investments. While return of capital distributions aren't immediately taxable, they reduce shareholders' cost basis, potentially increasing capital gains tax liability when shares are eventually sold.

The Fund's ability to generate sufficient earnings to cover its distribution is questionable based on these figures. With nearly three-quarters of the distribution not supported by current earnings or realized gains, the sustainability of this distribution level depends on either future performance improvement or continued willingness to return investor capital. The Board's quarterly review of the distribution level acknowledges this reality, noting the policy is subject to modification based on net asset value and market conditions.

For income-focused investors, understanding that most of what they're receiving isn't actual investment income but rather a return of their invested capital is crucial for proper portfolio and tax planning. This distribution structure essentially accelerates the return of principal that would otherwise occur upon sale of shares.

References:
[1] https://www.stocktitan.net/news/GAB/gabelli-equity-trust-10-distribution-policy-reaffirmed-and-declared-6mehspp5r1ty.html