The Gabelli Value 25 Fund Inc.
SUMMARY PROSPECTUS April 30, 2014
Class A (GABVX), C (GVCCX), I (GVCIX)
Before you invest, you may want to review the Fund’s Prospectus and Statement of Additional Information (“SAI”), which contain more information about the Fund and its risks. You can find the Fund’s Prospectus and SAI and other information about the Fund online at www.gabelli.com. You can also get this information at no cost by calling 800-422-3554 or by sending an email request to info@gabelli.com. The Fund’s Prospectus and SAI, both dated April 30, 2014, are incorporated by reference into this Summary Prospectus.
Investment Objective
The Gabelli Value 25 Fund Inc. (the “Fund”) seeks to provide long term capital appreciation.
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. You may qualify for sales charge discounts if you and your family invest, or agree to invest in the future, at least $50,000 in the Fund’s Class A Shares. More information about these and other discounts is available from your financial professional and in the section entitled “Classes of Shares” on page 12 of the Fund’s Prospectus.
| Class A Shares |
Class C Shares |
Class I Shares |
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| Shareholder Fees |
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| (fees paid directly from your investment): |
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| Maximum Sales Charge (Load) on Purchases (as a percentage of offering price) |
5.75% | None | None | |||||||||
| Maximum Deferred Sales Charge (Load) (as a percentage of redemption or offering price, whichever is lower) |
None | 1.00% | None | |||||||||
| Maximum Sales Charge (Load) Imposed on Reinvested Dividends (as a percentage of amount invested) |
None | None | None | |||||||||
| Redemption Fee (as a percentage of amount redeemed for shares held 7 days or less) |
2.00% | 2.00% | 2.00% | |||||||||
| Exchange Fee |
None | None | None | |||||||||
| Annual Fund Operating Expenses |
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| (expenses that you pay each year as a percentage of the value of your investment): |
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| Management Fees |
1.00% | 1.00% | 1.00% | |||||||||
| Distribution and Service (Rule 12b-1) Fees |
0.25% | 1.00% | None | |||||||||
| Other Expenses |
0.14% | 0.14% | 0.14% | |||||||||
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| Total Annual Fund Operating Expenses |
1.39% | 2.14% | 1.14% | |||||||||
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Expense Example
This example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds.
The example assumes that you invest $10,000 in the Fund for the time periods indicated and then redeem all of your shares at the end of those periods. The example also assumes that your investment has a 5% return each year, and that the Fund’s operating expenses remain the same. Although your actual costs may be higher or lower, based on these assumptions your costs would be:
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||||||
| Class A Shares |
$ | 708 | $ | 990 | $ | 1,292 | $ | 2,148 | ||||||||
| Class C Shares |
$ | 317 | $ | 670 | $ | 1,149 | $ | 2,472 | ||||||||
| Class I Shares |
$ | 116 | $ | 362 | $ | 628 | $ | 1,386 | ||||||||
You would pay the following expenses if you did not redeem your shares of the Fund:
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||||||
| Class A Shares |
$ | 708 | $ | 990 | $ | 1,292 | $ | 2,148 | ||||||||
| Class C Shares |
$ | 217 | $ | 670 | $ | 1,149 | $ | 2,472 | ||||||||
| Class I Shares |
$ | 116 | $ | 362 | $ | 628 | $ | 1,386 | ||||||||
Portfolio Turnover
The Fund pays transaction costs, such as commissions, when it buys and sells securities (or “turns over” its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when the Fund’s shares are held in a taxable account. These costs, which are not reflected in the annual fund operating expenses or in the example, affect the Fund’s performance. During the most recent fiscal year, the Fund’s portfolio turnover rate was 9% of the average value of its portfolio.
Principal Investment Strategies
The Fund invests primarily in equity securities of companies that Gabelli Funds, LLC, the Fund’s investment adviser (the “Adviser”) believes are undervalued and have the potential to achieve significant capital appreciation, overweighting its core twenty-five equity positions. The Adviser invests in companies whose securities are selling at a significant discount to their private market value (“PMV”). PMV is the value the Adviser believes informed investors would be willing to pay to acquire the entire company. If investor attention is focused on the underlying asset value of a company due to expected or actual developments or other catalysts, an investment opportunity to realize this PMV may exist. The Fund may invest in companies of any size and from time to time may invest a greater portion in companies with large, medium, or small market capitalizations.
In selecting investments, the Adviser also considers the market price of the issuer’s securities, its balance sheet characteristics and the perceived strength of its management. The Fund’s assets will be invested primarily in common stock. Many of the common stocks the Fund will buy will not pay dividends. These stocks will be bought for the potential that their prices will increase, providing capital appreciation for the Fund. The value of equity securities will fluctuate due to many factors, including the past and predicted earnings of the issuer, the quality of the issuer’s management, general market conditions, the forecasts for the issuer’s industry and the value of the issuer’s assets. Holders of equity securities only have rights to value in the company after all debts have been paid, and they could lose their entire investment in a company that encounters financial difficulty. The Fund may also invest up to 25% of its total assets in the securities of non-U.S. issuers, including issuers in emerging markets.
The Fund may invest up to 50% of its total assets in securities for which a tender or exchange offer has been made or announced and in securities of companies for which a merger, consolidation, liquidation, or similar reorganization proposal has been announced (“reorganization securities”). Frequently, the holders of reorganization securities will receive new securities (“substituted securities”) in exchange therefor. No more than 30% of the Fund’s total assets, however, may be invested in reorganization securities where the Adviser anticipates selling the reorganization securities or the substituted securities within six months or less of the initial purchase of the reorganization securities. This limitation, however, will not apply to reorganization securities that have been purchased to supplement a position in such securities held by the Fund for more than six months.
The Fund may purchase American Depositary Receipts (“ADRs”) or U.S. dollar-denominated securities of foreign issuers that are not included in the Fund’s 25% limitation on foreign securities. ADRs are receipts issued by U.S. banks or trust companies with respect to securities of foreign issuers held on deposit for use in the U.S. securities markets. While ADRs may not necessarily be denominated in the same currency as the securities into which they may be converted, many of the risks associated with foreign securities may also apply to ADRs.
The Adviser may sell a holding if a security reaches or exceeds the PMV estimated by the Adviser, or if the Adviser believes the emergence of a catalyst is no longer likely.
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Principal Risks
You May Want to Invest in the Fund if:
| • | you are a long term investor |
| • | you believe that the market will favor value over growth stocks over the long term |
| • | you wish to include a value strategy as a portion of your overall investments |
| • | you prefer to invest in a more concentrated portfolio |
The Fund’s share price will fluctuate with changes in the market value of the Fund’s portfolio securities. Your investment in the Fund is not guaranteed; you may lose money by investing in the Fund. When you sell Fund shares, they may be worth more or less than what you paid for them.
The principal risks presented by the Fund are:
| • | Equity Risk. Equity risk is the risk that the prices of the securities held by the Fund will change due to general market and economic conditions, perceptions regarding the industries in which the companies issuing the securities participate, and the issuer company’s particular circumstances. |
| • | Foreign Securities Risk. Investments in foreign securities involve risks relating to political, social, and economic developments abroad, as well as risks resulting from the differences between the regulations to which U.S. and foreign issuers and markets are subject. These risks include expropriation, differing accounting and disclosure standards, currency exchange risks, settlement difficulties, market illiquidity, difficulties enforcing legal rights, and greater transaction costs. These risks are more pronounced in the securities of companies located in emerging markets. |
| • | Issuer-Specific Risk. The value of an individual security or particular type of security can be more volatile than the market as a whole and can perform differently from the market as a whole. The Fund could lose all of its investment in a company’s securities. |
| • | Large-Capitalization Risk. Larger, more established companies may be unable to respond quickly to new competitive challenges such as changes in technology and consumer tastes. Many larger companies also may not be able to attain the high growth rate of successful smaller companies, especially during extended periods of economic expansion. |
| • | Management Risk. If the portfolio managers are incorrect in their assessment of the growth prospects of the securities the Fund holds, then the value of the Fund’s shares may decline. |
| • | Market Risk. The risk that the securities markets will move down, sometimes rapidly and unpredictably based on overall economic conditions and other factors. |
| • | Merger Risk. In general, securities of companies which are the subject of a tender or exchange offer or a merger, consolidation, liquidation, or reorganization proposal sell at a premium to their historic market price immediately prior to the announcement of an offer for the company. However, it is possible that the value of securities of a company involved in such a transaction will not rise and in fact may fall, in which case the Fund would lose money. It is also possible that the Adviser’s assessment that a particular company is likely to be acquired or acquired during a specific time frame may be incorrect, in which case the Fund may not realize any premium on its investment and could lose money if the value of the securities declines during the Fund’s holding period. |
| • | Small and Mid-Capitalization Risk. Risk is greater for the securities of small- and mid-capitalization companies (including small unseasoned companies that have been in operation less than three years) because they generally are more vulnerable than larger companies to adverse business or economic developments and they may have more limited resources. The securities of small- and mid-capitalization companies also may trade less frequently and in smaller volume than larger companies. As a result, the value of such securities may be more volatile than the securities of larger companies, and the Fund may experience difficulty in purchasing or selling such securities at the desired time and price. |
Performance
The bar chart and table that follow provide an indication of the risks of investing in the Fund by showing changes in the Fund’s performance from year to year, and by showing how the Fund’s average annual returns for one year, five
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years, and ten years compared with those of a broad based securities market index. As with all mutual funds, the Fund’s past performance (before and after taxes) does not predict how the Fund will perform in the future. Updated information on the Fund’s results can be obtained by visiting www.gabelli.com.
THE GABELLI VALUE 25 FUND INC.
(Total Returns for Class A Shares for the Years Ended December 31)
Sales loads are not reflected in the above chart. If sales loads were reflected, the Fund’s returns would have been less than those shown. During the years shown in the bar chart, the highest return for a quarter was 21.92% (quarter ended June 30, 2009) and the lowest return for a quarter was (26.01)% (quarter ended December 31, 2008).
| Average Annual Total Returns (for the years ended December 31, 2013, |
Past One Year |
Past Five Years |
Past Ten Years |
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| The Gabelli Value 25 Fund Class A Shares |
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| Return Before Taxes |
25.50 | % | 21.54 | % | 7.82 | % | ||||||
| Return After Taxes on Distributions |
24.74 | % | 20.61 | % | 6.75 | % | ||||||
| Return After Taxes on Distributions and Sale of Fund Shares |
15.00 | % | 17.80 | % | 6.43 | % | ||||||
| Class C Shares |
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| Return Before Taxes |
31.18 | % | 22.05 | % | 7.64 | % | ||||||
| Class I Shares (first issued on 1/11/08) |
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| Return Before Taxes |
33.51 | % | 23.28 | % | 8.62 | % | ||||||
| Standard & Poor’s (“S&P”) 500 Index (reflects no deduction for fees, expenses, or taxes) |
32.39 | % | 17.94 | % | 7.41 | % | ||||||
| Dow Jones Industrial Average (reflects no deduction for fees, expenses, or taxes) |
29.59 | % | 16.69 | % | 7.43 | % | ||||||
| Nasdaq Composite Index (reflects no deduction for fees, expenses, or taxes) |
40.12 | % | 22.92 | % | 8.81 | % | ||||||
The historical performance of Class A Shares is used to calculate performance for Class I Shares prior to their issuance. All Classes of the Fund would have substantially similar annual returns because the shares are invested in the same portfolio of securities and the annual returns would differ only to the extent that the Classes do not have the same expenses.
After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on the investor’s tax situation and may differ from those shown. After-tax returns shown are not relevant to investors who hold their Fund shares through tax deferred arrangements, such as 401(k) plans or Individual Retirement Accounts, including “Roth” IRAs and SEP IRAs (collectively, “IRAs”). After-tax returns are shown only for Class A Shares and after-tax returns for other classes will vary due to the differences in expenses.
Management
The Adviser. Gabelli Funds, LLC serves as the Adviser to the Fund.
The Portfolio Managers. Mr. Mario J. Gabelli, CFA, Chief Investment Officer — Value Portfolios of the Adviser, has served as Portfolio Manager of the Fund since 1989. Mr. Christopher Marangi has served as Portfolio Manager of the Fund since 2007.
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Purchase and Sale of Fund Shares
The minimum initial investment must be at least $1,000 for Class A, and Class C Shares ($250 for IRAs or “Coverdell” Education Saving Plans). There is no minimum initial investment in an automatic monthly investment plan. There is no minimum for subsequent investments.
Your minimum initial investment for Class I Shares must be at least $500,000. The minimum initial investment for Class I Shares is waived for employee benefit plans with assets of at least $50 million.
You can purchase or redeem the Fund’s shares on any day the New York Stock Exchange (“NYSE”) is open for trading (a “Business Day”). You may purchase or redeem Fund shares by written request via mail (The Gabelli Funds, P.O. Box 8308, Boston, MA 02266-8308), by personal or overnight delivery (The Gabelli Funds, c/o BFDS, 30 Dan Road, Canton, MA 02021-2809), by bank wire, or by Automated Clearing House (“ACH”) system.
You may also redeem Fund shares by telephone at 800-GABELLI (800-422-3554), on the Internet at www.gabelli.com, or through an automatic cash withdrawal plan.
You can also place orders to purchase or sell Fund shares through registered broker-dealers or other financial intermediaries that have entered into appropriate selling agreements with G.distributors, LLC (“G.distributors” or the “Distributor”), an affiliate of the Adviser. The broker-dealer or other financial intermediary will transmit these transaction orders to the Fund on your behalf and send you confirmation of your transactions and periodic account statements showing your investments in the Fund.
Tax Information
The Fund expects that distributions will generally be taxable as ordinary income or long term capital gains to taxable investors, unless you are investing through a tax deferred arrangement, such as a 401(k) plan or an IRA.
Payments to Broker-Dealers and Other Financial Intermediaries
If you purchase the Fund through a broker-dealer or other financial intermediary (such as a bank), the Fund and its related companies may pay the intermediary for the sale of Fund shares and related services. These payments may create a conflict of interest by influencing the broker-dealer or other intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediary’s website for more information.
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2760 multi 2014
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