The Gabelli Mathers Fund
Class AAA Shares
PROSPECTUS
October 1, 1999
The Securities and Exchange Commission has not approved or disapproved the
shares described in this prospectus or determined whether this prospectus is
accurate or complete. Any representation to the contrary is a criminal offense.
===============================================================================
<PAGE>
THE GABELLI MATHERS FUND TABLE OF CONTENTS
Page
Investment and Performance Summary...................................... 3-5
Investment and Risk Information......................................... 6-8
Management of the Fund................................................ 8-9
Purchasing, Selling and Exchanging Shares............................. 9
Pricing of Fund Shares................................................ 9-10
Dividends and Distributions........................................... 10
Tax Information....................................................... 10
Financial Highlights.................................................. 11
Additional Information.............................................. Back Cover
<PAGE>
INVESTMENT AND PERFORMANCE SUMMARY
Investment Objective
The Gabelli Mathers Fund (the "Fund") seeks to achieve capital appreciation over
the long term in various market conditions without excessive risk of capital
loss. Capital is the amount of money you invest in the Fund and capital
appreciation is an increase in the value of your investment.
Principal Investment Strategies
The Fund pursues its objective by using the following principal strategies:
* investing primarily in common stocks, selected for their appreciation
potential
* engaging, within prescribed limits, in short sales of common stocks
whereby the Fund borrows and sells a security it does not own in order to
profit from the potential decline in the price of that security
* varying its common stock exposure by hedging, primarily with the purchase
or short sale of S&P 500 Index futures contracts
* investing all or a portion of its assets primarily in U.S. Treasury
securities when Gabelli Funds, LLC (the "Adviser") believes the risk of
loss from investing in stocks is high
No minimum or maximum percentage of the Fund's assets is required to be invested
in any type of security or investment strategy.
Principal Investment Risks
The Fund is subject to the risks associated with investing in both stocks and
U.S. Treasury securities. The Fund is also subject to certain additional risks
associated with stock index futures hedging and the higher risk investment
strategy of selling stocks short.
The Fund's share price will fluctuate with changes in the market value of its
portfolio securities. Stocks are subject to market, economic and business risks
that cause their prices to rise and fall. The Fund is also subject to the risks
that the value of its U.S. Treasury securities, stock index futures hedge
position, and stocks sold short will decline. When you sell your Fund shares,
you may receive less than you paid for them.
Who May Want to Invest
The Fund may appeal to you if:
* you seek long-term growth of capital and are skeptical of a fully
invested buy and hold equity investment strategy
* you seek a portfolio that generally may be long and/or short individual
stocks, and/or long U.S. Treasury securities and/or may employ hedging
techniques with respect to its common stock exposure
* you seek a portfolio that is flexibly managed to potentially take
advantage of a decline in the U.S. equity markets
You may not want to invest in the Fund if:
* you seek returns that typically move with the S&P 500 Index, in both up
and down markets
* you seek a fully invested equity portfolio
An investment in the Fund is not a deposit of a bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency.
Performance
The return information below illustrates how the Fund's performance can vary and
gives some indication of the risks of investing in the Fund by comparing the
Fund's performance with two broad-based stock indices. Please keep in mind that
the Fund's past performance does not represent how it will perform in the
future. The return data includes the reinvestment of all income dividends and
capital gains distributions.
BAR CHART (Graphic Omitted)
Calendar Year Total Return
------------- ------------
1989 10.41%
1990 10.43%
1991 9.45%
1992 3.11%
1993 2.13%
1994 (5.89)%
1995 7.01%
1996 (0.07)%
1997 3.01%
1998 (5.21)%
During the period shown in the bar chart, the highest quarterly return was 5.19%
for the quarter ended March 1989, and the lowest quarterly return was (3.21)%
for the quarter ended December 1998. For the six months ended June 30, 1999, the
Fund's total return was 1.62%.
Average Annual Total Returns
(for the periods ended December 31, 1998)
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Since Inception
8-19-65
1 Year 5 Years 10 Years
The Gabelli Mathers Fund (5.21)% (0.35)% 3.28% 11.53%
S&P 500 Index* 28.72% 24.09% 19.21% 12.28%
Value Line Composite** (1.94)% 10.58% 9.32% 7.50%
</TABLE>
* The S&P 500 Index is an index of 500 stocks, with each stock weighted
according to its total market value. This means that companies having a
larger stock capitalization will have a larger impact on the index. The
performance of the Index does not reflect the expenses or fees of this
Fund.
** The Value Line Composite is an average comprised of approximately 1,617
stocks, with each stock having an equal weighting regardless of its total
market capitalization. This means that all companies, whether they have a
large or small stock capitalization, have an equal impact on the average.
The performance of the average does not reflect the expenses or fees of
this Fund.
Fees and Expenses of the Fund
This table describes the fees and expenses that you may pay if you buy and hold
shares of the Fund.
Shareholder Fees (fees paid directly from your investment)
Exchange Fee...................................... None*
* The Fund is a no-load Fund, so you pay no sales charges (loads) to buy or
sell shares. However, you may pay a front-end sales load if you exchange
your shares of the Fund for shares of a fund which charges a sales load at
the time of purchase.
Annual Fund Operating Expenses (expenses that are deducted from Fund assets)
Management Fees 1...................................................... 1.00%
Distribution (Rule 12b-1) Expenses 2................................... 0.25%
Other Expenses 3.......................... .......................... 0.35%
-----
Total Annual Operating Expenses ...................................... 1.60%
-----
Fee Waiver 4........................................................... (0.25)%
------
Total Annual Operating Expenses (after the fee waiver) ................ 1.35%
=====
1 Effective October 1, 1999, Gabelli Funds, LLC became the investment adviser
to the Fund. The expense information above has been restated to reflect this
change in adviser. Under the terms of the investment advisory agreement dated
October 1, 1999, the Adviser is entitled to receive a fee for providing
advisory and administrative services equal to 1.00% of the Fund's average
daily net assets (before giving effect to the fee waiver referred to in
footnote 4 below).
2 The Fund adopted a Rule 12b-1 Plan on October 1, 1999 to provide distribution
and shareholder services. Pursuant to the Plan, long-term shareholders may
indirectly pay more than the equivalent of the maximum permitted front-end
sales charge.
3 "Other Expenses" is an estimated figure reflecting expenses the Fund expects
to incur as a member of the Gabelli family of funds beginning on October 1,
1999, based on the Fund's total assets as of such date.
4 For the first two years after the change in Adviser, the Adviser will waive a
portion of its advisory fee so that the fee is 0.75% on the first $100
million of the Fund's assets.
Expense Example:
This example is intended to help you compare the cost of investing in shares of
the Fund with the cost of investing in other mutual funds. The example assumes
(1) you invest $10,000 in the Fund for the time periods shown, (2) you redeem
your shares at the end of the period, (3) your investment has a 5% return and
(4) the Fund's operating expenses remain the same and reflect the advisory fee
waiver referred to in footnote 4 above. This example is for comparison only and
your actual costs may be higher or lower.
1 Year 3 Years 5 Years 10 Years
- ------ ------- ------- --------
$142 $469 $847 $1,910
<PAGE>
INVESTMENT AND RISK INFORMATION
The Fund's investment objective and principal investment strategies described on
page three and in this section are not fundamental policies and may be changed
by a vote of a majority of the Board of Trustees of the Fund at any time without
a vote of shareholders. The Fund is flexibly managed and can use a variety of
investment strategies in the pursuit of its investment objective, with no
minimum or maximum percentage of assets required to be invested in any type of
security or investment strategy.
The Adviser selects stocks using traditional fundamental analysis of both value
and growth data, in conjunction with standard technical analysis. Fundamental
analysis involves the use of various data, including but not limited to,
price/earnings, price/revenues, price/book value, and price/dividend ratios, and
various growth rate calculations for earnings, sales and other data. Technical
analysis includes, but is not limited to, the study of rates of change in stock
price movement, volume trends, moving averages, relative strength, and
overbought/oversold indicators.
The Adviser's stock selection process is not limited by the total market value
of a company's stock, so the Fund may select small, medium or large
capitalization issues. Stocks of companies with a relatively small number of
shares available for trading may be more risky because their share prices tend
to be more volatile, and their shares less liquid, than those of companies with
larger amounts of tradeable shares. In general, companies with a small revenue
base may have more limited management and financial resources and may face a
higher risk of business reversal than larger more established companies. As a
result, stocks of smaller companies may be more volatile than stocks of larger
companies. Additionally, stocks of companies with special situation
characteristics may decline in value if their unique circumstances do not
develop as anticipated. Special situation factors may include, but are not
limited to, potential and/or announced takeover targets, corporate restructuring
candidates, and companies involved in corporate reorganizations.
The Fund may make short sales of equity securities in amounts of up to 30% of
the value of the Fund's net assets as determined at the time of the short sale.
A short sale is a transaction in which the Fund sells a security which it does
not then own in order to profit from the potential decline in the market price
of that security.
The Fund may vary its equity exposure by hedging through the purchase or short
sale of stock index futures contracts. The Fund will not purchase or sell short
stock index futures contracts if immediately thereafter the aggregate initial
margin required to be deposited would exceed 5% of the value of the Fund's total
assets.
The Fund may invest all or any portion of its assets in U.S. Treasury bills,
notes or bonds when the Adviser believes financial market conditions warrant
such action and/or during periods when the Adviser believes that the risk
associated with owning equity securities is high due to various traditional
stock market valuation benchmarks approaching the upper limits of their long
term historical ranges. At such times, which may continue for extended periods,
the Fund's equity exposure may represent a relatively low percentage of the
Fund's assets. For instance, during most of 1989 through the first six months of
1999, a majority of the Fund's assets were invested in U.S. Treasury securities.
The Fund may also engage in other investment practices in order to achieve its
investment objective. These are briefly discussed in the Statement of Additional
Information which may be obtained by calling 800-GABELLI (800-422-3554). The
Fund does not currently employ the other practices to any significant degree.
While the Fund's objective is to seek capital appreciation over the long term,
the Fund does not necessarily purchase or hold individual securities to qualify
for long-term capital gains treatment. The Adviser may consider a variety of
factors including, but not limited to, financial market conditions, individual
stock and aggregate equity valuation levels, corporate developments, other
investment opportunities, Fund redemptions, tax considerations, including the
Fund's tax loss carryforward (see "Tax Information"), and changed expectations,
in determining whether to sell a security held in the portfolio or to buy to
cover a short position. As a result, turnover in the Fund's portfolio may be
very high, since investments may be held for very short time periods when the
Adviser believes further capital appreciation of those investments is unlikely
or that a loss of capital may occur.
Portfolio turnover may be significantly increased if the Fund holds a
substantial portion of its assets in U.S. Treasury securities with maturities of
less than one year in conjunction with the purchase and sale of long equity
positions and U.S. Treasury securities with maturities greater than one year.
There are market risks inherent in any investment and there is no assurance that
the objective of the Fund will be realized. Also, there is no assurance that the
Fund's portfolio will not decline in value or that the portfolio's various
investment segments will perform as expected. When you sell your investment, you
may receive more or less money than you originally invested. Investing in the
Fund also involves the following specific risks:
Equity Risk: To the extent that the Fund's portfolio has significant equity
exposure, long and/or short, the Fund is subject to the risks inherent in the
stock market and individual stocks, including but not limited to the following:
* unpredictable price volatility in individual stocks and various stock
indices
* changes in interest rates, inflation and corporate profits, currency
exchange rate volatility, and other economic factors
* individual company and/or industry developments
* national and international political events
Short positions in equity securities are generally considered to be more risky
than long positions since the theoretical potential loss in a short position is
unlimited, while the maximum loss from a long position is equal to its original
purchase price.
The Adviser invests the Fund's assets more conservatively than the managers of
most equity funds when the Adviser believes the risk of owning stocks is high.
If the adviser is incorrect in this judgment, the Fund's total return may
underperform more fully-invested equity funds.
Hedging Risk: The percentage fluctuation in the value of the Fund's hedge
positions in stock index futures contracts may be greater than those of the
underlying index, and positions in such futures are subject to certain other
risks, including but not limited to the following:
* an imperfect correlation between the change in market value of the Fund's
long stock positions relative to its short stock index futures hedge
position, limiting the effectiveness of the hedge
* possible temporary illiquidity in the markets for stock index futures
which may result in continuing exposure to adverse price movements
* the fact that the decision to hedge may prove incorrect and, in that
case, the Fund would have been better off not hedging
Interest Rate Risk: To the extent that the Fund's portfolio is invested in U.S.
Treasury securities, it is subject to certain risks which include a decrease in
principal value of the securities as interest rates rise. Generally, the longer
the maturity of a fixed income security, the greater the gain or loss of
principal value for a given change in interest rates. Additionally, there is the
credit risk of the issuer of the security being unable to make interest or
principal payments when due.
Management Risk: The Adviser's analysis and judgment regarding individual
stocks, the financial markets, the economy, and many other factors may prove
incorrect, resulting in the Fund's investments losing value. Additionally, if
stock prices increase, the Fund may lose the opportunity to benefit on that
portion of its portfolio invested in fixed income securities.
<PAGE>
MANAGEMENT OF THE FUND
The Adviser: Effective October 1, 1999, Gabelli Funds, LLC, with principal
offices located at One Corporate Center, Rye, New York 10580-1434, (800)
422-3554, entered into a set of strategic initiatives with Mathers and Company,
Inc. and now serves as investment adviser to the Fund. The Adviser makes
investment decisions for the Fund and continuously reviews and administers the
Fund's investment program under the supervision of the Fund's Board of Trustees.
The Adviser and its affiliates also manage other open-end and closed-end
investment companies in the Gabelli family of funds. The Adviser is a New York
limited liability company organized in 1999 as successor to Gabelli Funds, Inc.,
a New York corporation organized in 1980. The Adviser is a wholly-owned
subsidiary of Gabelli Asset Management Inc., a publicly traded company listed on
the New York Stock Exchange (Symbol: GBL). The Adviser is entitled to receive a
1.00% annual fee to provide investment advisory and administrative services to
the Fund, except that the Adviser has waived a portion of its advisory fee so
that the fee is 0.75% on the first $100 million of the Fund's assets until
October 1, 2001.
Prior to October 1, 1999, Mathers and Company, Inc., 100 Corporate North, Suite
201, Bannockburn, Illinois 60015, (847) 295-7400, served as investment adviser
to the Fund. Under its investment advisory agreement, Mathers and Company, Inc.
received a fee equal to 0.74% of the Fund's average net assets in 1998, before
giving effect to expense reimbursements. Mathers and Company, Inc. served as
investment adviser to the Fund from its inception in 1965 and as investment
adviser to other clients since 1961. Henry G. Van der Eb, President of Mathers
and Company, Inc. and Chairman and a Director of the Fund, owned all of the
outstanding shares and was the controlling person of Mathers and Company, Inc.
Portfolio Manager: Henry G. Van der Eb, CFA, of Gabelli Funds, LLC, is
responsible for the day to day management of the Fund and has been the Fund's
portfolio manager for more than the last 20 years. Mr. Van der Eb (age 54) is
President, Chief Executive Officer, and Trustee of the Fund, served as President
of The Investment Analysts Society of Chicago for 1979-1980, and is a Chartered
Financial Analyst (CFA), a Chartered Investment Counselor CIC), and a member of
the Association for Investment Management and Research (AIMR). He received an
MBA from Northwestern University Graduate School of Management in 1970.
Year 2000: As the year 2000 approaches, concerns regarding the ability of
software used by the Fund's service providers to distinguish between the date
"2000" and the date "1900" have emerged . Failure to adequately address this
issue could result in major systems or process failures which could disrupt the
Fund's operations. The Adviser is working with the Fund's service providers to
prepare for the year 2000. Based on information currently available, the Adviser
does not expect that the Fund will incur significant operating expenses or be
required to incur material costs to be year 2000 compliant. The Fund cannot
guarantee, however, that all year 2000 issues will be identified and corrected
by January 1, 2000 and any non-compliant computer systems could hurt key Fund
operations, such as shareholder servicing, pricing and trading. In addition, the
year 2000 problem may adversely affect the companies in which the Fund invests,
which could lower the value of such companies' securities and negatively affect
the Fund's performance. For example, these companies may incur substantial costs
to correct the year 2000 problem.
Rule 12b-1 Plan: The Fund has adopted a plan under Rule 12b-1 (the "Plan") which
allows the Fund to pay for the sale and distribution of its shares at an annual
rate of 0.25% of the Fund's average daily net assets. The Fund may make payments
under the Plan for the purpose of financing any activity primarily intended to
result in the sale of the Fund's shares as determined by the Board of Trustees.
Because payments under the Plan are paid out of the Fund's assets on an on-going
basis, over time these fees will increase the cost of your investment and may
cost you more than paying other types of sales charges. See "Distribution Plan"
in the Statement of Additional Information for more details regarding the Plan
and the expenses payable under the Plan. Prior to October 1, 1999, the Fund had
no distribution plan under Rule 12b-1 in place.
PURCHASING, SELLING AND EXCHANGING SHARES
Information about purchasing, selling and exchanging your shares is contained in
a separate document called the Owner's Manual, which has been delivered with
this prospectus. The Owner's Manual is considered an integral part of this
prospectus. The Owner's Manual also contains information about the Telephone
Investment Plan, Telephone Redemption Plan, Automatic Investment Plan,
Systematic Withdrawal Plan and Retirement Plans.
PRICING OF FUND SHARES
The net asset value per share is calculated on each day on which the New York
Stock Exchange ("NYSE") is open for trading. The NYSE is open Monday through
Friday, but currently is scheduled to be closed on New Year's Day, Dr. Martin
Luther King, Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence
Day, Labor Day, Thanksgiving Day and Christmas Day and on the preceding Friday
or subsequent Monday when a holiday falls on a Saturday or Sunday, respectively.
The net asset value per share is determined as of the close of regular trading
on the NYSE, normally 4:00 p.m., Eastern time. It is computed by dividing the
value of the Fund's net assets (i.e. the value of its securities and other
assets less its liabilities, including expenses payable or accrued but excluding
capital stock and surplus) by the total number of its shares outstanding at the
time the determination is made. The Fund uses market quotations in valuing its
portfolio securities. Short-term investments that mature in 60 days or less are
valued at amortized cost, which the Trustees of the Fund believe represents fair
value.
The Fund may from time to time hold securities that are primarily listed on
foreign exchanges. Such securities may trade on days when the Fund does not
price its shares. Therefore, the net asset value of the Fund may change on days
when you are not able to purchase or redeem shares.
DIVIDENDS AND DISTRIBUTIONS
Dividends and distributions will be automatically reinvested for your account at
net asset value in additional shares of the Fund, unless you instruct the Fund
to either (i) pay all income dividends and capital gains distributions in cash
or (ii) reinvest capital gains distributions and pay income dividends in cash.
You may change your instructions by notifying the Fund in writing at any time
prior to the record date for a particular dividend or distribution. Dividends
from net investment income and distributions of net realized capital gains, if
any, will be paid at least annually. There are no sales or other charges in
connection with the reinvestment of dividends and capital gains distributions.
There is no fixed dividend rate, and there can be no assurance that the Fund
will pay any dividends or realize any capital gains.
TAX INFORMATION
The Fund expects that its distributions will consist primarily of net investment
income and capital gains, which may be taxable at different rates depending on
the length of time the Fund holds its assets. Dividends out of net investment
income and distributions of realized short-term capital gains are taxable to you
as ordinary income. Distributions of net long-term capital gains are taxable to
you at long-term capital gain rates. High portfolio turnover can indicate a high
level of short-term capital gains that, when distributed to shareholders, are
taxed as ordinary income rather than at the lower capital gains tax rate.
However, as of the date of this prospectus, the Fund has a large capital loss
carryforward that is used to offset any current or future realized capital
gains. Until this carryforward expires or is offset completely by realized
capital gains, shareholders will not receive distributions of, or pay taxes on,
those capital gains. The Fund's distributions, whether you receive them in cash
or reinvest them in additional shares of the Fund, may be subject to federal,
state or local taxes. An exchange of the Fund's shares for shares of another
Fund will be treated for tax purposes as a sale of the Fund's shares; therefore,
any gain you realize on such a transaction may be taxable. Foreign shareholders
may be subject to special withholding requirements.
This summary of tax consequences is intended for general information only. You
should consult a tax adviser concerning the tax consequences of your investment
in the Fund.
<PAGE>
FINANCIAL HIGHLIGHTS
The financial highlights table is intended to help you understand the Fund's
financial performance for the past five fiscal years. Certain information
reflects financial results for a single Fund share, based on the average number
of Fund shares outstanding during the period. The total returns in the table
represent the rate that an investor would have earned or lost on an investment
in the Fund's shares. The full year information has been audited by Arthur
Andersen LLP, independent accountants, whose report, along with the Fund's
financial statements and related notes, is included in the Fund's annual report,
which is available upon request.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Six months
ended
June 30, Year Ended December 31,
-----------------------------------
1999 1998 1997 1996 1995 1994
---- ---- ---- ---- ---- ----
Operating performance:
Net asset value,
beginning of year $11.73 $13.06 $13.27 $13.75 $13.55 $15.11
----- ----- ----- ----- ----- -----
Net investment
income/(loss) 0.22 0.58 0.53 0.40 0.60 0.56
Net realized and
unrealized (0.03) (1.26) (0.13) (0.41) 0.35 (1.45)
gain/(loss) on ------ ------ ------ ----- ------ -----
investments
Total from
investment operations 0.19 (0.68) 0.40 (0.01) 0.95 (0.89)
---- ----- ---- ----- ----- ----
Distributions to shareholders:
Net investment income --- (0.65) (0.61) (0.47) (0.72) (0.67)
Net realized gains --- --- --- --- (0.03) ---
----- ----- ----- ----- ----- -----
Total distributions --- (0.65) (0.61) (0.47) (0.75) (0.67)
------- ------ ------ ------ ------ ------
Net asset value,
end of period $11.92 $11.73 $13.06 $13.27 $13.75 $13.55
====== ====== ====== ====== ====== ======
Total return + 1.62% (5.21%) 3.01% (0.07%) 7.01% (5.89%)
Ratios to average net assets and supplemental data:
Net assets, end of period
(in 000's) $100,295 $108,548 $138,404 $171,596 $232,303 $293,285
Ratio of net
investment income to 3.74% 4.56% 3.96% 2.96% 4.25% 3.86%
average net assets*
Ratio of total expenses to 1.14% 1.16% 1.07% 1.03% 0.98% 0.93%
average net assets*
Portfolio turnover rate 261% 67% 50% 38% 58% 211%
</TABLE>
+ Total return assumes the reinvestment of all dividends and capital gains.
* Annualized
<PAGE>
The Gabelli Mathers Fund
Class AAA Shares
For More Information
For more information about the Fund, the following documents are available free
upon request:
Owner's Manual
Information about purchasing, selling and exchanging shares of the Fund is
included in a separate document entitled "Owner's Manual." The Owner's Manual is
incorporated by reference into this prospectus. If you have not received it,
please contact the Fund at the number listed below.
Annual/Semi-Annual Reports
The Fund's semi-annual and audited annual reports to shareholders contain
detailed information on the Fund's investments. In the annual report, you will
find a discussion of the market conditions and investment strategies that
significantly affected the Fund's performance during its last fiscal year.
Statement of Additional Information (SAI)
The SAI provides more detailed information about the Fund, including its
operations and investment policies. It is incorporated by reference and is
legally considered a part of this prospectus.
You can get free copies of these documents and prospectuses of other funds in
the Gabelli family, or request other information and discuss your questions
about the Fund by contacting:
The Gabelli Mathers Fund
One Corporate Center
Rye, NY 10580
Telephone: 800-GABELLI (800-422-3554)
www.gabelli.com
You can review the Fund's reports and SAI at the Public Reference Room of the
Securities and Exchange Commission. You can get text-only copies:
* For a fee, by writing the Public Reference Section of the Commission,
Washington, D.C. 20549-6009 or calling 800-SEC-0330.
* Free from the Commission's Website at http://www.sec.gov
(Investment Company Act file no. 811-1311)
The Gabelli Mathers Fund
One Corporate Center
Rye, New York 10580-1434
800-GABELLI
(800-422-3554)
fax: 914-921-5118
www.gabelli.com
e-mail: [email protected]
(Net Asset Value may be obtained daily by
calling 800-GABELLI after 6 P.M. eastern time)
Board of Trustees
<TABLE>
<CAPTION>
<S> <C>
Mario J. Gabelli, CFA Felix J. Christiana
Chairman and Chief Investment Officer, Former Senior Vice President
Gabelli Asset Management Inc. and Dollar Dry Dock Savings Bank
Gabelli Funds, LLC
Anthony J. Colavita Vincent D. Enright
Attorney-at-Law Former Senior Vice President
Anthony J. Colavita, P.C. and Chief Financial Officer,
KeySpan Energy Corp.
Charles G. Freund Jon P. Hedrich
Former Vice President, Secretary Former President and Partner
and Treasurer Steiner Diamond Institutional
MidCon Corp. Services
Robert E. Kohnen Karl Otto Pohl
Former Vice President and Investment Manager Former President
Protection Mutual Insurance Company Deutsche Bundesbank
Anthony R. Pustorino, CPA Werner J. Roeder, MD
Professor of Accounting, Pace University Practicing Private Physician
Medical Director, Lawrence
Hospital
Jack O. Vance Henry G. Van der Eb, CFA
Managing Director President and Chief Executive
Management Research, Inc. Officer
The Gabelli Mathers Fund
Anthonie C. van Ekris
Managing Director
BALMAC International
</TABLE>
Officers
Mario J. Gabelli, CFA Henry G. Van der Eb, CFA
Chairman President and Chief Executive Officer
Bruce N. Alpert, CPA Anne E. Morrissy, CFA
Executive Vice President and Treasurer Executive Vice President
James E. McKee Lawrence A. Kenyon, CPA
Secretary Senior Vice President
Heidi M. Stubner Edith L. Cook
Vice President Vice President
THE GABELLI FAMILY OF FUNDS
- -------------------------------------------------------------------------
Owner's Manual
- ---------------------------------------------------------------------------
AAA Class - No-Load Class
Gabelli Global Series Funds, Inc.
Gabelli Gold Fund, Inc.
Gabelli International Growth Fund, Inc.
Gabelli ABC Fund
Gabelli Asset Fund
Gabelli Growth Fund
May 1, 1999
The information contained in the Owner's Manual is incorporated by reference
into, and is legally considered part of, the Prospectuses for the Gabelli family
of Funds. The Owner's Manual must be preceded or accompanied by a Gabelli Funds
Prospectus.
<PAGE>
Owner's Manual
Table of Contents
Purchasing Shares
---------------------------- --------------------------------------
3 Instructions for Opening or Adding to an Account
4 Telephone Investment Plan
4 Automatic Investment Plan
4 Retirement Plans
4 Minimum Investments
5 Dividends and Distributions
Selling Shares
---------------------------- -------------------------------------
5 Instructions for Selling Shares
5 By Bank Wire or Check via Telephone
5 By Bank Wire or Check via Mail
6 General Policies on Selling Shares
6 Signature Guarantees
6 Verifying Telephone Redemptions
6 Redemptions Within 15 Days of Investment
6 Refusal of Redemption Request
6 Closing of Small Accounts
6 Undeliverable Distribution Checks
Exchanging Shares
---------------------------------------------------------------------------
7 Instructions for Exchanging Shares
Pricing of Fund Shares
------ ---------------------------------------------------------------------
7 How NAV is Calculated
<PAGE>
PURCHASING SHARES
Instructions for Opening or Adding to an Account
Purchases through Brokers/Dealers:
If purchasing through your financial advisor or brokerage account, simply tell
your advisor or broker that you wish to purchase shares of the Funds and he or
she will take care of the necessary documentation. Your should state
specifically which class of shares you are buying. For all other purchases
directly with the Fund, follow the instructions below.
Purchases directly from the Fund:
All investments made by regular mail or personal delivery, whether initial or
subsequent, should be sent to:
By Regular Mail By Overnight Delivery
The Gabelli Funds The Gabelli Funds
PO Box 8308 c/o BFDS Building, 6th Floor
Boston, MA 02266-8308 Two Heritage Drive
Quincy, MA 02171
For Initial Investment:
1. Carefully read and complete the application.
2. Make check, bank draft or money order payable to "[name of Fund]."
3. Mail or deliver application and payment to the address above.
For Subsequent Investments:
1. Make check, bank draft or money order payable to "[name of Fund]."
2. Provide the exact name and number of your account.
3. Mail or deliver payment to the address above.
By Wire Transfer
For Initial Investment:
Call 1-800-GABELLI (1-800-422-3554) to obtain a new account number. Promptly
mail the completed application to the
address shown above for regular mail, and
For Initial and Subsequent Investments:
Instruct your bank to wire transfer your investment to:
State Street Bank and Trust Company
ABA #011-0000-28 REF DDA# 9904-6187
Attn: Shareholder Services
Re: [Fund Name]
A/C#___________________________
Your name ______________________
225 Franklin Street, Boston, MA 02110
Note: Your bank may charge a wire transfer fee.
Call 1-800-GABELLI
or your investment representative.
<PAGE>
Purchasing Shares (continued)
You can add to your account by using the convenient options described below. The
Fund reserves the right to change or eliminate these privileges at any time upon
60 days notice to shareholders.
<TABLE>
<CAPTION>
<S> <C>
Telephone Investment Plan Automatic Investment Plan
You may purchase additional shares of the Funds You can make automatic monthly investments in the Funds.
by telephone as long as your bank is a member Details about this plan can be obtained from the
of the Automated Clearing House (ACH) system. Distributor on a separate application by calling
You must also have a completed, approved Investment 1-800-GABELLI (800-422-3554).
Plan application on file with the Fund's Transfer
Agent.
There is a minimum of $100 for each telephone Retirement Plans
investment. To initiate an ACH purchase, please You can invest in various types of retirement plans
call 1-800-GABELLI (1-800-422-3554) or through the Fund. Details about these plans can be
1-800-872-5365. obtained from the Distributor on a separate application
by calling 1-800-GABELLI (800-422-3554)
</TABLE>
Minimum Investments
You may purchase Funds through the Distributor or participating
organizations, which may charge additional fees and may require higher or
lower minimum investments or impose other limitations on buying and selling
shares.
Minimum
Initial Minimum
Account type Investment Subsequent
................................ ..................... ......................
Regular (non-retirement) $ 1,000 $ 0
Retirement (IRA)
Traditional IRA $ 1,000 $ 0
Roth IRA $ 1,000 $ 0
Spousal IRA $ 250 $ 0
Education IRA $ 250 $ 0
................................ ..................... .....................
Automatic Investment Plan $ 0 $ 100
................................ ..................... .....................
Telephone Investment Plan $ 100 $ 100
................................ ..................... .....................
All purchases must be in U.S. dollars. A fee will be charged for any
checks that do not clear. Third-party checks are not accepted. Your
purchase of shares will be effective on the same business day if the
Fund's transfer agent receives your order by 4:00 p.m. (12 noon for a
money market fund), and receives Federal funds by 4:00 p.m., eastern time.
Otherwise, your purchase will be effective on the next business day. (See
"Pricing of Fund Shares.") Shares are held on account for you unless you
specify in writing that you would like to receive a stock certificate
(certificates are not available for money market funds). We can only issue
a certificate for whole shares.
The Distributor may reject a purchase order if it considers it in the best
interest of the Fund and its shareholders. A Fund may waive its minimum
purchase requirement.
Dividends and Distributions
All dividends and distributions will be automatically reinvested unless you
request otherwise.
SELLING SHARES
As a mutual fund shareholder, you are technically selling shares when you
request a withdrawal in cash. This is also known as redeeming shares.
- -------------------------------------------------------------------------------
Withdrawing Money from Your Investment
- ------------------------------------------------------------------------
You may sell your shares at any time. Your sales price will be the next NAV
after your sell order is received by the Fund, its transfer agent, or your
investment representative. See section on "General Policies on Selling
Shares" below.
Systematic Withdrawal Plan
You can receive automatic payments from your account on a monthly, quarterly
or annual basis. You can obtain details from the Distributor.
- -----------------------------------------------------------------------------
Instructions for Selling Shares
The Fund accepts telephone requests for redemptions of unissued shares.
By Bank Wire or Check via Telephone
1. Call 1-800-GABELLI (1-800-422-3554) with your account number, the amount of
the redemption and instructions as to how you wish to receive your funds.
2. If you are unable to reach the Fund by telephone, you may telecopy your
redemption request to the Fund at 914-921-____.
NOTE: If you call by 4:00 p.m., eastern time, your payment will normally be
wired to your bank on the following business day. (For Money Market Funds: If
you call before 12:00 noon, eastern time, your payment will be wired to your
bank on that day.) If you call after that time, your payment will be wired to
your bank on the next business day. If you request your wire redemption by
telephone, it must be at least $1,000. Your bank may charge a fee for incoming
wires.
By Bank Wire or Check via Mail
Submit a redemption request to the Fund. Redemption requests may be made by
letter to the Transfer Agent. You must specify the name of the Fund, the dollar
amount or number of shares you wish to redeem and the account number. You must
sign the letter in exactly the same way the account is registered, and if there
is more than one owner of shares, all must sign. A signature guarantee is
required for most requests.
Selling Shares (continued)
General Policies on Selling Shares
Signature Guarantees
Signature guarantees are required on redemption requests for the following:
* The check is not being mailed to the address on your account
* The check is not being made payable to the owner of the account
* The redemption proceeds are being transferred to another person's Fund
account.
A signature guarantee can be obtained from most banks and securities dealers.
Notarized signatures are not considered a signature guarantee.
Verifying Telephone Redemptions
The Fund makes every effort to ensure that telephone redemptions are only made
by authorized shareholders. All telephone calls are recorded for your protection
and you will be asked for information to verify your identity. If appropriate
precautions have not been taken, the Fund may be liable for losses due to
unauthorized transactions.
Redemptions Within 15 Days of Investment
When you have made an investment by check or through the automatic investment
plan, your redemption proceeds will not be mailed until the Transfer Agent is
satisfied that the check has cleared (which may require up to 15 days). You can
avoid this delay by purchasing shares with a certified check or federal funds
wire.
Redemption In Kind
The Fund reserves the right to make a redemption in kind - payment in portfolio
securities rather than cash - for certain large redemption amounts that could
hurt fund operations.
Refusal of Redemption Request
Payment for shares may be delayed under extraordinary circumstances or as
permitted by the Securities and Exchange Commission in order to protect
remaining shareholders.
Closing of Small Accounts
If your account (other than an IRA) falls below $500, the Fund may ask you to
increase your balance. If it is still below $500 after 30 days, the Fund may
close your account and send you the proceeds at the current NAV.
Undeliverable Distribution Checks
If distribution checks (1) are returned and marked as "undeliverable" or (2)
remain uncashed for six months, your account will be changed automatically so
that all future distributions are reinvested in your account. Checks that remain
uncashed for six months will be canceled and the money reinvested in the Fund at
the then current net asset value.
Call 1-800-GABELLI or
your investment representative.
Questions? Call 1-800-GABELLI or your investment
representative.
<PAGE>
EXCHANGING SHARES
You can exchange your shares in one Fund for shares of the same class of another
Fund managed by Gabelli Funds, LLC, or its affiliates, usually without paying
additional sales charges (see "Notes" below).
You must meet the minimum investment requirements for the Fund into which you
are exchanging. Exchanges from one Fund to another are taxable transactions.
Instructions for Exchanging Shares
- ------------------------------------------------------------------------------
Exchanges may be made by sending a written request to The Gabelli Funds,
PO Box 8308, Boston, MA 02266-8308 or by calling 1-800-GABELLI
(1-800-422-3554).
Please provide the following information:
* Your name and telephone number
* The exact name on your account and account number
* Taxpayer identification number (usually your Social Security number)
* Dollar value or number of shares to be exchanged o The names of the
Funds from/into which the exchange is to be made
See "Selling Shares" for important information about telephone
transactions.
Notes on exchanges
When exchanging from a Fund that
has no sales charge or a lower
sales charge to a Fund with a
higher sales charge, you will pay
the difference.
The registration
and tax identification numbers of
the two accounts must be identical.
This exchange privilege may be
changed or eliminated at any time
upon a 60-day notice to
shareholders.
Be sure to read the
prospectus carefully of any Fund
into which you wish to exchange
shares.
PRICING OF FUND SHARES
How NAV is Calculated
The NAV is calculated by adding the total value of the Fund's investments and
other assets, subtracting its liabilities and then dividing that figure by the
number of outstanding shares of the Fund:
NAV =
Total Assets - Liabilities
Number of Shares
Outstanding
You can find the Fund's NAV daily in the Wall Street Journal and other
newspapers, or by calling 1-800-GABELLI (800-422-3554).
A Fund's net asset value, or NAV, is determined and its shares are priced
at the close of regular trading on the New York Stock Exchange, normally
at 4:00 p.m., eastern time, on days the New York Stock Exchange is open.
Your order for purchase, sale or exchange of shares is priced at the next
NAV calculated after your order is received by the Fund. This is what is
known as the offering price.
Fund securities are valued as of the close of trading on the primary
exchange on which they trade. Fund securities are generally valued at
current market prices. If market quotations are not available, prices
will be based on the average of the latest bid and asked quotations for
such securities prior to the valuation time, or the latest bid price if
asked prices are not available. Debt securities with remaining maturities
of 60 days or less will be valued at amortized cost, which the Board of
Directors believes represents fair value.
Some Fund securities may be listed on foreign exchanges that are open on
days (such as U.S. holidays) when a Fund does not compute its NAV. This
could cause the value of a Fund's portfolio investments to be affected on
days when you cannot buy or sell shares.
Questions?
Call 800-GABELLI
or your investment representative.
