N-Q 1 d89283dnq.htm GABELLI EQUITY TRUST INC. Gabelli Equity Trust Inc.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED

MANAGEMENT INVESTMENT COMPANY

 

 

Investment Company Act file number            811-04700                    

 
 

 

The Gabelli Equity Trust Inc.

 
    (Exact name of registrant as specified in charter)    
 

 

One Corporate Center

Rye, New York 10580-1422

 
   

(Address of principal executive offices) (Zip code)

 

Bruce N. Alpert

Gabelli Funds, LLC

One Corporate Center

Rye, New York 10580-1422

   
   

(Name and address of agent for service)

 

Registrant’s telephone number, including area code: 1-800-422-3554          

 

Date of fiscal year end: December 31

 

Date of reporting period: September 30, 2015

   

Form N-Q is to be used by management investment companies, other than small business investment companies registered on Form N-5 (§§ 239.24 and 274.5 of this chapter), to file reports with the Commission, not later than 60 days after the close of the first and third fiscal quarters, pursuant to rule 30b1-5 under the Investment Company Act of 1940 (17 CFR 270.30b1-5). The Commission may use the information provided on Form N-Q in its regulatory, disclosure review, inspection, and policymaking roles.

A registrant is required to disclose the information specified by Form N-Q, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-Q unless the Form displays a currently valid Office of Management and Budget (“OMB”) control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to the Secretary, Securities and Exchange Commission, 100 F Street, NE, Washington, DC 20549. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.


Item 1. Schedule of Investments.

The Schedule(s) of Investments is attached herewith.


The Gabelli Equity Trust Inc.

Third Quarter Report — September 30, 2015

(Y)our Portfolio Management Team

 

 

LOGO

To Our Shareholders,

For the quarter ended September 30, 2015, the net asset value (“NAV”) total return of The Gabelli Equity Trust Inc. (the “Fund”) was (11.7)%, compared with total returns of (6.4)% and (7.0)% for the Standard & Poor’s (“S&P”) 500 Index and the Dow Jones Industrial Average, respectively. The total return for the Fund’s publicly traded shares was (14.3)%. The Fund’s NAV per share was $5.67, while the price of the publicly traded shares closed at $5.22 on the New York Stock Exchange (“NYSE”). See below for additional performance information.

Enclosed is the schedule of investments as of September 30, 2015.

Comparative Results

 

Average Annual Returns through September 30, 2015 (a) (Unaudited)   
         Quarter     1 Year     5 Year     10 Year      15 Year      20 Year      25 Year      Since
Inception
 (08/21/86) 
 

Gabelli Equity Trust

  

  NAV Total Return (b)

     (11.74)     (5.99)     12.33     7.55%         7.29%         9.18%         10.50%         10.48%    

  Investment Total Return (c)

     (14.27)        (9.51)        11.77        7.07            6.62            9.11            10.57            9.89       

S&P 500 Index

     (6.44)        (0.61)        13.34        6.80            3.96            8.14            9.09            9.69(d)   

Dow Jones Industrial Average

     (6.97)        (2.12)        11.31        7.13            5.39            8.76            10.50            10.50(d)   

Nasdaq Composite Index

     (7.07)        4.16         15.75        9.15            2.53            8.59            10.93            9.29(e)   

 

  (a)

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 for performance information as of the most recent month end. Performance returns for periods of less than one year are not annualized. Investors should carefully consider the investment objectives, risks, charges, and expenses of the Fund before investing. The Dow Jones Industrial Average is an unmanaged index of 30 large capitalization stocks. The S&P 500 and the Nasdaq Composite Indices are unmanaged indicators of stock market performance. Dividends are considered reinvested except for the Nasdaq Composite Index. You cannot invest directly in an index.

 

 

  (b)

Total returns and average annual returns reflect changes in the NAV per share, reinvestment of distributions at NAV on the ex-dividend date, adjustments for rights offerings, spin-offs, and taxes paid on undistributed long term capital gains and are net of expenses. Since inception return is based on an initial NAV of $9.34.

 

 

  (c)

Total returns and average annual returns reflect changes in closing market values on the NYSE, reinvestment of distributions, and adjustments for rights offerings, spin-offs, and taxes paid on undistributed long term capital gains. Since inception return is based on an initial offering price of $10.00.

 

 

  (d)

From August 31, 1986, the date closest to the Fund’s inception for which data is available.

 

 

  (e)

From September 30, 1986, the date closest to the Fund’s inception for which data is available.

 

 


The Gabelli Equity Trust Inc.

Portfolio Changes — Quarter Ended September 30, 2015 (Unaudited)

 

 

          Shares           Ownership at 
September 30,
       2015       
 

NET PURCHASES

     

Common Stocks

     

Alere Inc.

     15,000            37,450     

Ascent Capital Group Inc., Cl. A

     2,000            16,000     

AT&T Inc.(a)

     481,454            481,454     

B/E Aerospace Inc.

     1,000            31,000     

Baxalta Inc.(b)

     22,000            22,000     

Blyth Inc.

     80,000            199,000     

Boulder Brands Inc.

     50,000            50,000     

Cable One Inc.(c)

     2,100            2,100     

Canadian Solar Inc.

     20,000            20,000     

Cempra Inc.

     18,100            18,100     

Chemtura Corp.

     12,500            62,500     

CST Brands Inc.

     25,000            88,500     

DigitalGlobe Inc.

     4,000            24,000     

EchoStar Corp., Cl. A

     5,000            39,440     

Edgewell Personal Care Co.(d)

     148,000            148,000     

Emerson Electric Co.

     2,000            7,000     

Endo International plc

     2,500            11,500     

Energizer Holdings Inc.(d)

     143,000            143,000     

Financial Engines Inc.

     2,000            6,000     

Hennessy Capital Acquisition Corp. II

     20,000            20,000     

Integrated Device Technology Inc.

     25,000            75,000     

Laboratory Corp. of America Holdings

     5,000            5,000     

Liberty Global plc LiLAC, Cl. A(e)

     3,545            3,545     

Liberty Global plc LiLAC, Cl. C(f)

     5,750            5,750     

Methanex Corp.

     20,000            20,000     

Mylan NV

     2,000            11,000     

PayPal Holdings Inc.(g)

     20,000            20,000     

The Kraft Heinz Co.(h)

     55,333            55,333     

The Chemours Co.(i)

     4,000            4,000     

United Natural Foods Inc.

     10,000            10,000     

NET SALES

     

Common Stocks

     

AMC Networks Inc., Cl. A

     (1,100)           265,100     

Aramark

     (5,000)           7,500     

Berkshire Hathaway Inc., Cl. A

     (1)           123     

Cablevision Systems Corp., Cl. A

     (2,000)           1,100,000     

CLARCOR Inc.

     (2,000)           109,900     

DIRECTV(a)

     (307,500)           —     

DISH Network Corp., Cl. A

     (10,500)           78,900     

Donaldson Co. Inc.

     (3,000)           367,800     

Electronic Arts Inc.

     (4,000)           2,000     

Energizer Holdings Inc.(d)

     (143,000)           —     
          Shares           Ownership at 
September 30,
       2015       
 

 

GrafTech International Ltd.(j)

  

 

 

 

(112,000)

 

  

  

 

 

 

—  

 

  

Grupo Televisa SAB, ADR

     (12,500)         592,500     

Hospira Inc.(k)

     (50,000)         —     

Koninklijke Philips NV

     (1)         34,170     

Kraft Foods Group Inc.(h)

     (55,333)         —     

Liberty Global plc, Cl. C

     (20,000)         220,000     

O’Reilly Automotive Inc.

     (1,000)         89,000     

Post Holdings Inc.

     (5,000)         41,000     

Rentrak Corp.

     (5,000)         —     

Rollins Inc.

     (11,000)         1,795,500     

Rolls-Royce Holdings plc

     (15,000)         1,161,000     

Rolls-Royce Holdings plc, Cl. C(l)

     (169,200,000)         —     

Societe d’Edition de Canal +(m)

     (32,000)         —     

Telefonica Brasil SA, ADR

     (6,500)         70,000     

The Central Europe, Russia, and Turkey Fund Inc.(n)

     (6,988)         86,343     

The Madison Square Garden Co., Cl. A

     (1,600)         303,400     

Viacom Inc., Cl. A

     (1,000)         275,500     

 

(a)

Merger - $28.50 cash plus 1.892 shares of AT&T Inc. for every 1 share of DIRECTV held. 100,336 shares of AT&T Inc. were sold after merger.

(b)

Spin off - 1 share of Baxalta Inc. for every 1 share of Baxter International Inc. held. 5,000 shares were sold after spin off.

(c)

Spin off - 1 share of Cable One Inc. for every 1 share of Graham Holdings Co., Class B held. 300 shares were purchased after spin off.

(d)

Spin off - 1 share of Energizer Holdings Inc. (29272W109) plus 1 share of Edgewell Personal Care Co. for every 1 share of Energizer Holdings Inc. (29266R108) held. 5,000 shares of Edgewell Personal Care Co. were purchased after spin off.

(e)

Spin off - 1 share of Liberty Global plc LiLAC, Cl. A for every 20 shares of Liberty Global plc, Cl. A held. 295 shares of Liberty Global plc LiLAC, Cl. A were sold after spin off.

(f)

Spin off - 1 share of Liberty Global plc LiLAC, Cl. C for every 20 shares of Liberty Global plc, Cl. C held. 6,250 shares of Liberty Global plc LiLAC, Cl. C were sold after spin off.

(g)

Spin off - 1 share of PayPal Holdings Inc. for every 1 share of eBay Inc. held.

(h)

Merger - $16.50 cash plus 1 share of The Kraft Heinz Co. for every 1 share of Kraft Foods Group Inc. held.

(i)

Spin off - 1 share of The Chemours Co. for every 5 shares of E. I. du Pont de Nemours and Co. held.

(j)

Tender offer - $5.05 cash for every 1 share held.

(k)

Tender offer - $90.00 cash for every 1 share held.

(l)

Tender Offer - £0.001 cash for every 1 share held.

(m)

Tender offer - 8.00 cash for 1 share held.

(n)

Tender offer - 7.486935% of 93,331 shares were accepted for tender offer. $21.59 cash for every 1 share held.

 

 

See accompanying notes to schedule of investments.

 

2


The Gabelli Equity Trust Inc.

Schedule of Investments — September 30, 2015 (Unaudited)

 

 

Shares

        

Market

Value

 
 

COMMON STOCKS — 97.5%

  
 

Food and Beverage — 11.5%

  
  3,000     

Ajinomoto Co. Inc.

   $ 62,893   
  50,000     

Boulder Brands Inc.†

     409,500   
  53,541     

Brown-Forman Corp., Cl. A

     5,728,352   
  17,975     

Brown-Forman Corp., Cl. B

     1,741,777   
  63,800     

Campbell Soup Co.

     3,233,384   
  65,000     

Chr. Hansen Holding A/S

     3,630,931   
  15,000     

Coca-Cola Enterprises Inc.

     725,250   
  100,000     

ConAgra Foods Inc.

     4,051,000   
  30,600     

Constellation Brands Inc., Cl. A

     3,831,426   
  18,000     

Crimson Wine Group Ltd.†

     162,900   
  201,500     

Danone SA

     12,703,373   
  652,800     

Davide Campari-Milano SpA

     5,193,631   
  197,000     

Diageo plc, ADR

     21,234,630   
  89,800     

Dr Pepper Snapple Group Inc.

     7,098,690   
  80,000     

Flowers Foods Inc.

     1,979,200   
  76,200     

Fomento Economico Mexicano SAB de CV, ADR

     6,800,850   
  50,000     

General Mills Inc.

     2,806,500   
  1,848,400     

Grupo Bimbo SAB de CV, Cl. A†

     4,678,705   
  41,300     

Heineken NV

     3,333,794   
  16,000     

Ingredion Inc.

     1,396,960   
  105,000     

ITO EN Ltd.

     2,187,263   
  12,800     

Kellogg Co.

     851,840   
  64,000     

Kerry Group plc, Cl. A

     4,779,994   
  10,600     

LVMH Moet Hennessy Louis Vuitton SE

     1,802,733   
  45,000     

Maple Leaf Foods Inc.

     742,863   
  287,000     

Mondelēz International Inc., Cl. A

     12,016,690   
  70,000     

Morinaga Milk Industry Co. Ltd.

     290,001   
  42,900     

Nestlé SA

     3,224,323   
  213,000     

PepsiCo Inc.

     20,085,900   
  39,200     

Pernod Ricard SA

     3,950,092   
  41,000     

Post Holdings Inc.†

     2,423,100   
  43,000     

Remy Cointreau SA

     2,819,003   
  55,333     

The Kraft Heinz Co.

     3,905,403   
  117,600     

The Coca-Cola Co.

     4,718,112   
  32,000     

The Hain Celestial Group Inc.†

     1,651,200   
  3,000     

The J.M. Smucker Co.

     342,270   
  42,000     

The WhiteWave Foods Co.†

     1,686,300   
  125,186     

Tootsie Roll Industries Inc.

     3,917,070   
  50,000     

Tyson Foods Inc., Cl. A

     2,155,000   
  341,000     

Yakult Honsha Co. Ltd.

     16,884,425   
    

 

 

 
         181,237,328   
    

 

 

 
 

Financial Services — 8.8%

  
  416,000     

American Express Co.

     30,838,080   
  50,000     

American International Group Inc.

     2,841,000   
  13,200     

Argo Group International Holdings Ltd.

     746,988   
  72,000     

Banco Santander SA, ADR

     380,160   
  123     

Berkshire Hathaway Inc., Cl. A†

     24,014,520   
  10,000     

Calamos Asset Management Inc., Cl. A

     94,800   
  18,800     

CIT Group Inc.

     752,564   

Shares

        

Market

Value

 
  88,000     

Citigroup Inc.

   $ 4,365,680   
  16,000     

Cullen/Frost Bankers Inc.

     1,017,280   
  12,777     

Deutsche Bank AG

     344,468   
  6,000     

Financial Engines Inc.

     176,820   
  50,000     

Fortress Investment Group LLC, Cl. A

     277,500   
  40,400     

H&R Block Inc.

     1,462,480   
  20,000     

Hennessy Capital Acquisition Corp. II†

     197,200   
  40,000     

Interactive Brokers Group Inc., Cl. A

     1,578,800   
  340,100     

Janus Capital Group Inc.

     4,625,360   
  56,800     

JPMorgan Chase & Co.

     3,463,096   
  32,400     

Kinnevik Investment AB, Cl. A

     932,522   
  125,000     

Legg Mason Inc.

     5,201,250   
  95,900     

Leucadia National Corp.

     1,942,934   
  14,000     

Loews Corp.

     505,960   
  125,000     

Marsh & McLennan Companies Inc.

     6,527,500   
  9,000     

Moody’s Corp.

     883,800   
  22,000     

Och-Ziff Capital Management Group LLC, Cl. A

     192,060   
  20,000     

PayPal Holdings Inc.†

     620,800   
  50,000     

Quinpario Acquisition Corp. 2†

     514,000   
  124,100     

State Street Corp.

     8,340,761   
  17,000     

SunTrust Banks Inc.

     650,080   
  128,400     

T. Rowe Price Group Inc.

     8,923,800   
  210,500     

The Bank of New York Mellon Corp.

     8,241,075   
  20,000     

The Charles Schwab Corp.

     571,200   
  12,300     

The Dun & Bradstreet Corp.

     1,291,500   
  13,000     

W. R. Berkley Corp.

     706,810   
  57,000     

Waddell & Reed Financial Inc., Cl. A

     1,981,890   
  270,000     

Wells Fargo & Co.

     13,864,500   
    

 

 

 
       139,069,238   
    

 

 

 
 

Entertainment — 7.0%

  
  116,600     

Discovery Communications Inc., Cl. A†

     3,035,098   
  244,800     

Discovery Communications Inc., Cl. C†

     5,946,192   
  592,500     

Grupo Televisa SAB, ADR

     15,416,850   
  143,123     

Media General Inc.†

     2,002,291   
  71,700     

Starz, Cl. A†

     2,677,278   
  303,400     

The Madison Square Garden Co., Cl. A†

     21,887,276   
  186,800     

Time Warner Inc.

     12,842,500   
  40,000     

Tokyo Broadcasting System Holdings Inc.

     532,822   
  581,200     

Twenty-First Century Fox Inc., Cl. A

     15,680,776   
  367,000     

Twenty-First Century Fox Inc., Cl. B

     9,934,690   
  70,000     

Universal Entertainment Corp.

     1,228,858   
  275,500     

Viacom Inc., Cl. A

     12,196,385   
  346,666     

Vivendi SA

     8,185,056   
    

 

 

 
         111,566,072   
    

 

 

 
 

Cable and Satellite — 6.7%

  
  265,100     

AMC Networks Inc., Cl. A†

     19,397,367   
  2,100     

Cable One Inc.†

     880,782   
  1,100,000     

Cablevision Systems Corp., Cl. A

     35,717,000   
  91,400     

Comcast Corp., Cl. A, Special

     5,231,736   
  78,900     

DISH Network Corp., Cl. A†

     4,603,026   
  39,440     

EchoStar Corp., Cl. A†

     1,697,103   
 

 

See accompanying notes to schedule of investments.

 

3


The Gabelli Equity Trust Inc.

Schedule of Investments (Continued) — September 30, 2015 (Unaudited)

 

 

Shares

        

Market

Value

 
 

COMMON STOCKS (Continued)

  
 

Cable and Satellite (Continued)

  
  3,545     

Liberty Global plc LiLAC, Cl. A†

   $ 119,431   
  5,750     

Liberty Global plc LiLAC, Cl. C†

     196,880   
  481,890     

Rogers Communications Inc., New York, Cl. B

     16,615,567   
  19,310     

Rogers Communications Inc., Toronto, Cl. B

     665,323   
  108,800     

Scripps Networks Interactive Inc., Cl. A

     5,351,872   
  120,000     

Shaw Communications Inc., New York, Cl. B

     2,328,000   
  40,000     

Shaw Communications Inc., Toronto, Cl. B

     774,522   
  65,000     

Time Warner Cable Inc.

     11,659,050   
    

 

 

 
         105,237,659   
    

 

 

 
 

Equipment and Supplies — 5.4%

  
  450,000     

AMETEK Inc.

     23,544,000   
  7,000     

Amphenol Corp., Cl. A

     356,720   
  94,000     

CIRCOR International Inc.

     3,771,280   
  367,800     

Donaldson Co. Inc.

     10,327,824   
  262,500     

Flowserve Corp.

     10,799,250   
  37,400     

Franklin Electric Co. Inc.

     1,018,402   
  268,000     

IDEX Corp.

     19,108,400   
  49,000     

Ingersoll-Rand plc

     2,487,730   
  43,300     

Mueller Industries Inc.

     1,280,814   
  13,000     

Sealed Air Corp.

     609,440   
  45,000     

Tenaris SA, ADR

     1,084,950   
  10,000     

The Greenbrier Companies Inc.

     321,100   
  4,000     

The Manitowoc Co. Inc.

     60,000   
  81,000     

The Timken Co.

     2,226,690   
  59,600     

The Weir Group plc

     1,054,867   
  125,000     

Watts Water Technologies Inc., Cl. A

     6,602,500   
    

 

 

 
       84,653,967   
    

 

 

 
 

Health Care — 4.7%

  
  6,000     

Agilent Technologies Inc.

     205,980   
  37,450     

Alere Inc.†

     1,803,217   
  8,000     

Allergan plc†

     2,174,480   
  34,000     

Amgen Inc.

     4,702,880   
  22,000     

Baxalta Inc.

     693,220   
  27,000     

Baxter International Inc.

     886,950   
  12,500     

Becton, Dickinson and Co.

     1,658,250   
  19,200     

Biogen Inc.†

     5,602,752   
  270,000     

Boston Scientific Corp.†

     4,430,700   
  76,300     

Bristol-Myers Squibb Co.

     4,516,960   
  18,100     

Cempra Inc.†

     503,904   
  15,000     

DaVita HealthCare Partners Inc.†

     1,084,950   
  11,500     

Endo International plc†

     796,720   
  20,000     

Express Scripts Holding Co.†

     1,619,200   
  28,800     

Henry Schein Inc.†

     3,822,336   
  46,800     

Indivior plc

     160,425   
  37,000     

Johnson & Johnson

     3,453,950   
  5,000     

Laboratory Corp. of America Holdings†

     542,350   
  25,000     

Mead Johnson Nutrition Co.

     1,760,000   
  32,000     

Medtronic plc.

     2,142,080   
  95,200     

Merck & Co. Inc.

     4,701,928   

Shares

        

Market

Value

 
  11,000     

Mylan NV†

   $ 442,860   
  88,200     

Novartis AG, ADR

     8,107,344   
  15,000     

Teva Pharmaceutical Industries Ltd., ADR

     846,900   
  87,000     

UnitedHealth Group Inc.

     10,092,870   
  4,000     

Waters Corp.†

     472,840   
  54,500     

William Demant Holding A/S†

     4,529,866   
  8,600     

Zimmer Biomet Holdings Inc.

     807,798   
  35,000     

Zoetis Inc.

     1,441,300   
    

 

 

 
           74,005,010   
    

 

 

 
 

Diversified Industrial — 4.6%

  
  500     

Acuity Brands Inc.

     87,790   
  160,000     

Ampco-Pittsburgh Corp.

     1,745,600   
  195,100     

Crane Co.

     9,093,611   
  149,000     

General Electric Co.

     3,757,780   
  138,300     

Greif Inc., Cl. A

     4,413,153   
  12,800     

Greif Inc., Cl. B

     494,976   
  32,000     

Griffon Corp.

     504,640   
  353,000     

Honeywell International Inc.

     33,425,570   
  122,000     

ITT Corp.

     4,078,460   
  11,000     

Jardine Strategic Holdings Ltd.

     295,240   
  8,000     

Kennametal Inc.

     199,120   
  50,000     

Myers Industries Inc.

     670,000   
  86,000     

Park-Ohio Holdings Corp.

     2,481,960   
  9,666     

Rayonier Advanced Materials Inc.

     59,156   
  30,000     

Rexnord Corp.

     509,400   
  15,000     

Sulzer AG

     1,469,834   
  100,000     

Toray Industries Inc.

     859,001   
  12,000     

Tredegar Corp.

     156,960   
  46,000     

Trinity Industries Inc.

     1,042,820   
  217,000     

Tyco International plc

     7,260,820   
    

 

 

 
       72,605,891   
    

 

 

 
 

Automotive: Parts and Accessories — 4.5%

  

  107,600     

BorgWarner Inc.

     4,475,084   
  109,900     

CLARCOR Inc.

     5,240,032   
  244,100     

Dana Holding Corp.

     3,876,308   
  245,000     

Genuine Parts Co.

     20,308,050   
  160,600     

Johnson Controls Inc.

     6,642,416   
  188,000     

Modine Manufacturing Co.†

     1,479,560   
  89,000     

O’Reilly Automotive Inc.†

     22,250,000   
  115,000     

Standard Motor Products Inc.

     4,011,200   
  73,000     

Superior Industries International Inc.

     1,363,640   
  14,000     

Visteon Corp.†

     1,417,360   
    

 

 

 
       71,063,650   
    

 

 

 
 

Consumer Products — 4.2%

  
  100,000     

Avon Products Inc.

     325,000   
  199,000     

Blyth Inc.†

     1,188,030   
  15,300     

Christian Dior SE

     2,855,938   
  20,000     

Church & Dwight Co. Inc.

     1,678,000   
  105,000     

Coty Inc., Cl. A

     2,841,300   
  5,000     

Crocs Inc.†

     64,625   
 

 

See accompanying notes to schedule of investments.

 

4


The Gabelli Equity Trust Inc.

Schedule of Investments (Continued) — September 30, 2015 (Unaudited)

 

 

Shares

        

Market

Value

 
 

COMMON STOCKS (Continued)

  
 

Consumer Products (Continued)

  
  148,000     

Edgewell Personal Care Co.

   $ 12,076,800   
  143,000     

Energizer Holdings Inc.

     5,535,530   
  2,100     

Givaudan SA

     3,415,247   
  100,000     

Hanesbrands Inc.

     2,894,000   
  23,800     

Harley-Davidson Inc.

     1,306,620   
  1,270     

Hermes International

     461,209   
  9,000     

Jarden Corp.†

     439,920   
  5,000     

Mattel Inc.

     105,300   
  11,000     

National Presto Industries Inc.

     926,860   
  10,000     

Oil-Dri Corp. of America

     229,000   
  46,800     

Reckitt Benckiser Group plc

     4,238,584   
  30,000     

Svenska Cellulosa AB, Cl. B

     837,998   
  823,800     

Swedish Match AB

     24,871,625   
  2,800     

The Estee Lauder Companies Inc., Cl. A

     225,904   
    

 

 

 
       66,517,490   
    

 

 

 
 

Consumer Services — 4.0%

  
  20,000     

eBay Inc.†

     488,800   
  43,000     

IAC/InterActiveCorp.

     2,806,610   
  205,000     

Liberty Interactive Corp. QVC Group, Cl. A†

     5,377,150   
  21,000     

Liberty TripAdvisor Holdings Inc., Cl. A†

     465,570   
  58,330     

Liberty Ventures, Cl. A†

     2,353,616   
  1,795,500     

Rollins Inc.

     48,245,085   
  125,000     

The ADT Corp.

     3,737,500   
  5,500     

TripAdvisor Inc.†

     346,610   
    

 

 

 
           63,820,941   
    

 

 

 
 

Telecommunications — 3.9%

  
  481,454     

AT&T Inc.

     15,685,771   
  55,400     

BCE Inc.

     2,269,184   
  954,200     

BT Group plc, Cl. A

     6,056,763   
  750,000     

Cincinnati Bell Inc.†

     2,340,000   
  100,000     

Deutsche Telekom AG, ADR

     1,777,000   
  25,002     

Harris Corp.

     1,828,860   
  36,000     

Hellenic Telecommunications Organization SA

     313,768   
  15,000     

Hellenic Telecommunications Organization SA, ADR

     66,000   
  264,732     

Koninklijke KPN NV

     989,199   
  7,040,836     

LIME†

     29,804   
  22,000     

Oi SA, ADR†

     14,872   
  31,053     

Sprint Corp.†

     119,244   
  21,000     

Telecom Argentina SA, ADR

     305,760   
  575,000     

Telecom Italia SpA†

     708,044   
  70,000     

Telefonica Brasil SA, ADR

     639,100   
  578,715     

Telefonica SA, ADR

     6,967,729   
  570,300     

Telephone & Data Systems Inc.

     14,234,688   
  25,000     

TELUS Corp.

     787,748   
  125,000     

Verizon Communications Inc.

     5,438,750   
  40,027     

Vodafone Group plc, ADR

     1,270,457   
    

 

 

 
       61,842,741   
    

 

 

 

Shares

        

Market

Value

 
 

Energy and Utilities — 3.8%

  
  11,000     

ABB Ltd., ADR

   $ 194,370   
  39,000     

Anadarko Petroleum Corp.

     2,355,210   
  59,000     

Apache Corp.

     2,310,440   
  80,000     

BP plc, ADR

     2,444,800   
  20,000     

Canadian Solar Inc.†

     332,400   
  30,000     

Cleco Corp.

     1,597,200   
  18,000     

CMS Energy Corp.

     635,760   
  185,100     

ConocoPhillips

     8,877,396   
  50,000     

CONSOL Energy Inc.

     490,000   
  217,500     

El Paso Electric Co.

     8,008,350   
  30,000     

Eversource Energy

     1,518,600   
  58,600     

Exxon Mobil Corp.

     4,356,910   
  140,000     

GenOn Energy Inc., Escrow†

     0   
  196,400     

Halliburton Co.

     6,942,740   
  4,000     

Marathon Oil Corp.

     61,600   
  8,000     

Marathon Petroleum Corp.

     370,640   
  20,000     

Murphy USA Inc.†

     1,099,000   
  18,000     

National Fuel Gas Co.

     899,640   
  18,000     

NextEra Energy Inc.

     1,755,900   
  1,000     

Niko Resources Ltd., OTC†

     35   
  3,000     

Niko Resources Ltd., Toronto†

     112   
  32,400     

Oceaneering International Inc.

     1,272,672   
  15,100     

Phillips 66

     1,160,284   
  140,000     

Rowan Companies plc, Cl. A

     2,261,000   
  28,000     

RPC Inc.

     247,800   
  5,000     

SJW Corp.

     153,750   
  17,000     

Southwest Gas Corp.

     991,440   
  108,900     

Spectra Energy Corp.

     2,860,803   
  101,000     

The AES Corp.

     988,790   
  35,000     

Weatherford International plc†

     296,800   
  164,000     

Westar Energy Inc.

     6,304,160   
    

 

 

 
           60,788,602   
    

 

 

 
 

Retail — 3.6%

  
  73,300     

AutoNation Inc.†

     4,264,594   
  10,000     

Bed Bath & Beyond Inc.†

     570,200   
  40,000     

Costco Wholesale Corp.

     5,782,800   
  88,500     

CST Brands Inc.

     2,978,910   
  117,800     

CVS Health Corp.

     11,365,344   
  75,000     

Hertz Global Holdings Inc.†

     1,254,750   
  22,100     

HSN Inc.

     1,265,004   
  50,000     

J.C. Penney Co. Inc.†

     464,500   
  341,000     

Macy’s Inc.

     17,500,120   
  30,000     

Penske Automotive Group Inc.

     1,453,200   
  33,300     

Sally Beauty Holdings Inc.†

     790,875   
  17,000     

The Cheesecake Factory Inc.

     917,320   
  3,000     

Tiffany & Co.

     231,660   
  10,000     

United Natural Foods Inc.†

     485,100   
  52,000     

Walgreens Boots Alliance Inc.

     4,321,200   
  33,200     

Wal-Mart Stores Inc.

     2,152,688   
 

 

See accompanying notes to schedule of investments.

 

5


The Gabelli Equity Trust Inc.

Schedule of Investments (Continued) — September 30, 2015 (Unaudited)

 

 

Shares

        

Market

Value

 
 

COMMON STOCKS (Continued)

  

 

Retail (Continued)

  

  35,000     

Whole Foods Market Inc.

   $ 1,107,750   
    

 

 

 
             56,906,015   
    

 

 

 
 

Business Services — 3.0%

  

  14,334     

Allegion plc

     826,498   
  7,500     

Aramark

     222,300   
  16,000     

Ascent Capital Group Inc., Cl. A†

     438,080   
  157,000     

Clear Channel Outdoor Holdings Inc., Cl. A†

     1,119,410   
  33,000     

Contax Participacoes SA

     19,894   
  96,000     

Diebold Inc.

     2,857,920   
  24,000     

DigitalGlobe Inc.†

     456,480   
  3,000     

Edenred

     48,926   
  170,400     

G4S plc

     594,679   
  17,300     

Jardine Matheson Holdings Ltd.

     817,425   
  88,000     

Landauer Inc.

     3,255,120   
  16,600     

Macquarie Infrastructure Corp.

     1,239,356   
  322,000     

MasterCard Inc., Cl. A

     29,018,640   
  309,200     

The Interpublic Group of Companies Inc.

     5,914,996   
  10,000     

Vectrus Inc.†

     220,400   
  12,800     

Visa Inc., Cl. A

     891,648   
    

 

 

 
       47,941,772   
    

 

 

 
 

Aviation: Parts and Services — 2.3%

  

  31,000     

B/E Aerospace Inc.

     1,360,900   
  270,300     

Curtiss-Wright Corp.

     16,872,126   
  23,500     

KLX Inc.†

     839,890   
  78,000     

Precision Castparts Corp.

     17,917,380   
    

 

 

 
       36,990,296   
    

 

 

 
 

Aerospace and Defense — 2.2%

  

  275,000     

Aerojet Rocketdyne Holdings Inc.†

     4,449,500   
  616,615     

BBA Aviation plc

     2,497,055   
  35,800     

Kaman Corp.

     1,283,430   
  17,500     

Northrop Grumman Corp.

     2,904,125   
  1,161,000     

Rolls-Royce Holdings plc

     11,890,129   
  93,000     

The Boeing Co.

     12,178,350   
    

 

 

 
       35,202,589   
    

 

 

 
 

Machinery — 2.1%

  

  12,800     

Caterpillar Inc.

     836,608   
  53,592     

CNH Industrial NV

     349,420   
  295,000     

Deere & Co.

     21,830,000   
  311,000     

Xylem Inc.

     10,216,350   
    

 

 

 
       33,232,378   
    

 

 

 
 

Specialty Chemicals — 2.0%

  

  10,000     

Ashland Inc.

     1,006,200   
  62,500     

Chemtura Corp.†

     1,788,750   
  20,000     

E. I. du Pont de Nemours and Co.

     964,000   
  420,000     

Ferro Corp.†

     4,599,000   
  8,000     

FMC Corp.

     271,280   
  39,000     

H.B. Fuller Co.

     1,323,660   

Shares

        

Market

Value

 

 

 

 

11,000

 

  

 

Huntsman Corp.

  

 

$

 

106,590

 

  

  73,000     

International Flavors & Fragrances Inc.

     7,537,980   
  20,000     

Methanex Corp.

     663,200   
  250,000     

OMNOVA Solutions Inc.†

     1,385,000   
  192,600     

Sensient Technologies Corp.

     11,806,380   
  6,000     

SGL Carbon SE†

     95,304   
  4,000     

The Chemours Co.

     25,880   
    

 

 

 
             31,573,224   
    

 

 

 
 

Hotels and Gaming — 1.6%

  

  16,000     

Accor SA

     746,606   
  45,000     

Belmond Ltd., Cl. A†

     454,950   
  90,000     

Genting Singapore plc

     45,852   
  8,000     

Hyatt Hotels Corp., Cl. A†

     376,800   
  9,095     

International Game Technology plc

     139,426   
  27,200     

Interval Leisure Group Inc.

     499,392   
  779,400     

Ladbrokes plc

     1,128,335   
  43,000     

Las Vegas Sands Corp.

     1,632,710   
  4,569,500     

Mandarin Oriental International Ltd.

     6,968,488   
  70,000     

MGM China Holdings Ltd.

     81,019   
  50,000     

MGM Resorts International†

     922,500   
  34,000     

Pinnacle Entertainment Inc.†

     1,150,560   
  188,800     

Ryman Hospitality Properties Inc.

     9,294,624   
  29,000     

Starwood Hotels & Resorts Worldwide Inc.

     1,927,920   
  200,000     

The Hongkong & Shanghai Hotels Ltd.

     225,547   
  4,000     

Wyndham Worldwide Corp.

     287,600   
  2,500     

Wynn Resorts Ltd.

     132,800   
    

 

 

 
       26,015,129   
    

 

 

 
 

Broadcasting — 1.6%

  

  253,300     

CBS Corp., Cl. A, Voting

     11,373,170   
  2,000     

Cogeco Inc.

     79,955   
  17,334     

Corus Entertainment Inc., OTC, Cl. B

     183,394   
  6,666     

Corus Entertainment Inc., Toronto, Cl. B

     70,481   
  16,000     

Gray Television Inc.†

     204,160   
  19,250     

Liberty Broadband Corp., Cl. A†

     990,220   
  62,047     

Liberty Broadband Corp., Cl. C†

     3,174,945   
  89,000     

Liberty Media Corp., Cl. A†

     3,179,080   
  171,000     

Liberty Media Corp., Cl. C†

     5,892,660   
  85,200     

Television Broadcasts Ltd.

     283,632   
    

 

 

 
       25,431,697   
    

 

 

 
 

Electronics — 1.3%

  

  19,100     

Bel Fuse Inc., Cl. A

     314,959   
  7,000     

Emerson Electric Co.

     309,190   
  4,000     

Hitachi Ltd., ADR

     202,280   
  75,000     

Integrated Device Technology Inc.†

     1,522,500   
  60,000     

Intel Corp.

     1,808,400   
  34,170     

Koninklijke Philips NV

     801,628   
  2,400     

Mettler-Toledo International Inc.†

     683,376   
  42,600     

TE Connectivity Ltd.

     2,551,314   
 

 

See accompanying notes to schedule of investments.

 

6


The Gabelli Equity Trust Inc.

Schedule of Investments (Continued) — September 30, 2015 (Unaudited)

 

 

Shares

        

Market

Value

 
 

COMMON STOCKS (Continued)

  

 

Electronics (Continued)

  

  245,000     

Texas Instruments Inc.

   $ 12,132,400   
    

 

 

 
             20,326,047   
    

 

 

 
 

Wireless Communications — 1.2%

  

  105,000     

America Movil SAB de CV, Cl. L, ADR

     1,737,750   
  9,000,000     

Cable & Wireless Communications plc

     7,542,546   
  42,000     

Millicom International Cellular SA, SDR

     2,624,388   
  150,000     

NTT DoCoMo Inc.

     2,491,977   
  50,075     

Tim Participacoes SA, ADR

     473,209   
  28,000     

T-Mobile US Inc.†

     1,114,680   
  104,600     

United States Cellular Corp.†

     3,705,978   
    

 

 

 
       19,690,528   
    

 

 

 
 

Environmental Services — 1.2%

  

  35,000     

Pentair plc

     1,786,400   
  230,800     

Republic Services Inc.

     9,508,960   
  157,400     

Waste Management Inc.

     7,840,094   
    

 

 

 
       19,135,454   
    

 

 

 
 

Publishing — 1.2%

  

  1,800     

Graham Holdings Co., Cl. B

     1,038,600   
  6,250     

Journal Media Group Inc.

     46,875   
  111,600     

McGraw Hill Financial Inc.

     9,653,400   
  104,000     

Meredith Corp.

     4,428,320   
  125,000     

News Corp., Cl. A

     1,577,500   
  148,600     

News Corp., Cl. B

     1,905,052   
  25,000     

The E.W. Scripps Co., Cl. A

     441,750   
    

 

 

 
       19,091,497   
    

 

 

 
 

Telecommunication Services — 0.8%

  

  76,800     

Liberty Global plc, Cl. A†

     3,297,792   
  220,000     

Liberty Global plc, Cl. C†

     9,024,400   
    

 

 

 
       12,322,192   
    

 

 

 
 

Agriculture — 0.7%

  

  200,000     

Archer Daniels Midland Co.

     8,290,000   
  16,000     

Monsanto Co.

     1,365,440   
  12,800     

Syngenta AG, ADR

     816,384   
  10,000     

The Mosaic Co.

     311,100   
    

 

 

 
       10,782,924   
    

 

 

 
 

Computer Software and Services — 0.6%

  

  7,000     

Check Point Software Technologies Ltd.†

     555,310   
  2,000     

Electronic Arts Inc.†

     135,500   
  1,002     

Google Inc., Cl. C†

     609,637   
  23,000     

InterXion Holding NV†

     622,840   
  62,000     

NCR Corp.†

     1,410,500   
  21,900     

Rockwell Automation Inc.

     2,222,193   
  20,000     

VeriFone Systems Inc.†

     554,600   
  130,000     

Yahoo! Inc.†

     3,758,300   
    

 

 

 
       9,868,880   
    

 

 

 

Shares

        

Market

Value

 
 

Automotive — 0.6%

  

  95,746     

General Motors Co.

   $ 2,874,295   
  222,874     

Navistar International Corp.†

     2,834,957   
  75,000     

PACCAR Inc.

     3,912,750   
    

 

 

 
             9,622,002   
    

 

 

 
 

Real Estate — 0.5%

  

  40,000     

Forest City Enterprises Inc., Cl. A†

     805,200   
  56,000     

Griffin Industrial Realty Inc.

     1,384,880   
  275,000     

The St. Joe Co.†

     5,260,750   
    

 

 

 
       7,450,830   
    

 

 

 
 

Communications Equipment — 0.5%

  

  430,000     

Corning Inc.

     7,361,600   
    

 

 

 
 

Metals and Mining — 0.4%

  

  37,400     

Agnico Eagle Mines Ltd.

     946,968   
  110,000     

Alcoa Inc.

     1,062,600   
  54,000     

Barrick Gold Corp.

     343,440   
  30,000     

Cliffs Natural Resources Inc.

     73,200   
  40,000     

Freeport-McMoRan Inc.

     387,600   
  4,800     

Materion Corp.

     144,096   
  50,000     

New Hope Corp. Ltd.

     61,943   
  143,600     

Newmont Mining Corp.

     2,307,652   
  51,000     

TimkenSteel Corp.

     516,120   
  140,000     

Turquoise Hill Resources Ltd.†

     357,000   
  14,000     

Vale SA, ADR

     58,800   
    

 

 

 
       6,259,419   
    

 

 

 
 

Transportation — 0.4%

  

  139,800     

GATX Corp.

     6,172,170   
    

 

 

 
 

Building and Construction — 0.3%

  

  18,000     

Assa Abloy AB, Cl. B

     322,368   
  86,000     

Fortune Brands Home & Security Inc.

     4,082,420   
  45,000     

Layne Christensen Co.†

     292,500   
    

 

 

 
       4,697,288   
    

 

 

 
 

Closed-End Funds — 0.2%

  

  4,285     

Royce Global Value Trust Inc.

     30,038   
  30,000     

Royce Value Trust Inc.

     345,000   
  86,343     

The Central Europe, Russia, and Turkey Fund Inc.

     1,544,676   
  123,430     

The New Germany Fund Inc.

     1,778,626   
    

 

 

 
       3,698,340   
    

 

 

 
 

Manufactured Housing and Recreational Vehicles — 0.1%

   

  5,000     

Martin Marietta Materials Inc.

     759,750   
  30,000     

Nobility Homes Inc.†

     354,150   
  50,000     

Skyline Corp.†

     144,000   
    

 

 

 
       1,257,900   
    

 

 

 
 

 

See accompanying notes to schedule of investments.

 

7


The Gabelli Equity Trust Inc.

Schedule of Investments (Continued) — September 30, 2015 (Unaudited)

 

 

Shares

        

Market

Value

 
 

COMMON STOCKS (Continued)

  

 

Real Estate Investment Trusts — 0.0%

  

  29,000         

Rayonier Inc.

   $ 640,030   
    

 

 

 
 

TOTAL COMMON STOCKS

     1,544,078,790   
    

 

 

 
 

CONVERTIBLE PREFERRED STOCKS — 0.1%

  

 

Telecommunications — 0.1%

  

  21,000         

Cincinnati Bell Inc.,
6.750%, Ser. B

     1,007,370   
    

 

 

 
 

WARRANTS — 0.0%

  

 

Energy and Utilities — 0.0%

  

  115,800         

Kinder Morgan Inc., expire 05/25/17†

     106,536   
    

 

 

 

Principal
Amount

            
 

CONVERTIBLE CORPORATE BONDS — 0.1%

  

 

Diversified Industrial — 0.1%

  

  $  2,000,000     

Griffon Corp., Sub. Deb.,
4.000%, 01/15/17(a)

     2,393,750   
    

 

 

 
 

U.S. GOVERNMENT OBLIGATIONS — 2.3%

  

  35,810,000     

U.S. Treasury Bills,
0.000% to 0.245%††,
10/01/15 to 03/31/16

     35,805,659   
    

 

 

 
 

TOTAL INVESTMENTS — 100.0%
(Cost $963,595,581)

   $ 1,583,392,105   
    

 

 

 
 

Aggregate tax cost

   $ 974,845,145   
    

 

 

 
 

Gross unrealized appreciation

   $ 691,423,349   
 

Gross unrealized depreciation

     (82,876,389
    

 

 

 
 

Net unrealized appreciation/depreciation

   $ 608,546,960   
    

 

 

 

 

(a)

Security exempt from registration under Rule 144A of the Securities Act of 1933, as amended. This security may be resold in transactions exempt from registration, normally to qualified institutional buyers. At September 30, 2015, the market value of the Rule 144A security amounted to $2,393,750 or 0.15% of total investments.

Non-income producing security.

††

Represents annualized yield at date of purchase.

ADR

American Depositary Receipt

SDR

Swedish Depositary Receipt

 

Geographic Diversification

  

% of Total

Investments

 

Market

Value

North America

       82.5 %     $ 1,307,078,731  

Europe

       13.4         211,463,029  

Latin America

       2.5         39,539,703  

Japan

       1.6         24,739,520  

Asia/Pacific

       0.0         571,122  
    

 

 

     

 

 

 

Total Investments

       100.0 %     $ 1,583,392,105  
    

 

 

     

 

 

 
 

 

See accompanying notes to schedule of investments.

 

8


The Gabelli Equity Trust Inc.

Notes to Schedule of Investments (Unaudited)

 

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 schedule of investments. 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 schedule of investments.

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 Directors (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”).

Portfolio securities primarily traded on a foreign market are generally valued at the preceding closing values of such securities on the relevant market, but may be fair valued pursuant to procedures established by the Board if market conditions change significantly after the close of the foreign market, but prior to the close of business on the day the securities are being valued. Debt instruments with remaining maturities of sixty days or less that are not credit impaired are valued at amortized cost, unless the Board determines such amount does not reflect the securities’ fair value, in which case these securities will be fair valued as determined by the Board. Debt instruments having a maturity greater than sixty days for which market quotations are readily available are valued at the average of the latest bid and asked prices. If there were no asked prices quoted on such day, the security is valued using the closing bid price. U.S. government obligations with maturities greater than sixty days are normally valued using a model that incorporates market observable data such as reported sales of similar securities, broker quotes, yields, bids, offers, and reference data. Certain securities are valued principally using dealer quotations. Futures contracts are valued at the closing settlement price of the exchange or board of trade on which the applicable contract is traded.

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

 

9


The Gabelli Equity Trust Inc.

Notes to Schedule of Investments (Unaudited) (Continued)

 

 

   

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 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 and other financial instruments by inputs used to value the Fund’s investments as of September 30, 2015 is as follows:

 

     Valuation Inputs     
     Level 1
Quoted Prices
   Level 2 Other Significant
Observable Inputs
   Level 3 Significant
Unobservable Inputs
   Total Market Value
at 9/30/15

INVESTMENTS IN SECURITIES:

                   

ASSETS (Market Value):

                   

Common Stocks:

                   

Energy and Utilities

     $ 60,788,602                 $ 0        $ 60,788,602  

Manufactured Housing and Recreational Vehicles

       903,750        $ 354,150                   1,257,900  

Other Industries (a)

       1,482,032,288                            1,482,032,288  

Total Common Stocks

       1,543,724,640          354,150          0          1,544,078,790  

Convertible Preferred Stocks (a)

       1,007,370                            1,007,370  

Warrants (a)

       106,536                            106,536  

Convertible Corporate Bonds (a)

                2,393,750                   2,393,750  

U.S. Government Obligations

                35,805,659                   35,805,659  

TOTAL INVESTMENTS IN SECURITIES – ASSETS

     $ 1,544,838,546        $ 38,553,559        $ 0        $ 1,583,392,105  

 

(a)

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

The Fund did not have transfers among Level 1, Level 2, and Level 3 during the period ended September 30, 2015. The Fund’s policy is to recognize transfers among Levels as of the beginning of the reporting period.

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 is 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. Among the factors to be considered to fair value a security are recent prices of comparable securities that are publicly traded, reliable prices of securities not publicly traded, 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

 

10


The Gabelli Equity Trust Inc.

Notes to Schedule of Investments (Unaudited) (Continued)

 

 

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 include back testing the prices realized in subsequent trades of these fair valued securities to fair values previously recognized.

Derivative Financial Instruments. The Fund may engage in various portfolio investment strategies by investing in a number of derivative financial instruments for the purposes of increasing the income of the Fund, hedging against changes in the value of its portfolio securities and in the value of securities it intends to purchase, or hedging against a specific transaction with respect to either the currency in which the transaction is denominated or another currency. Investing in certain derivative financial instruments, including participation in the options, futures, or swap markets, entails certain execution, liquidity, hedging, tax, and securities, interest, credit, or currency market risks. Losses may arise if the Adviser’s prediction of movements in the direction of the securities, foreign currency, and interest rate markets is inaccurate. Losses may also arise if the counterparty does not perform its duties under a contract, or that, in the event of default, the Fund may be delayed in or prevented from obtaining payments or other contractual remedies owed to it under derivative contracts. The creditworthiness of the counterparties is closely monitored in order to minimize these risks. Participation in derivative transactions involves investment risks, transaction costs, and potential losses to which the Fund would not be subject absent the use of these strategies. The consequences of these risks, transaction costs, and losses may have a negative impact on the Fund’s ability to pay distributions.

The Fund’s derivative contracts held at September 30, 2015, if any, are not accounted for as hedging instruments under GAAP and are disclosed in the Schedule of Investments together with the related counterparty.

Swap Agreements. The Fund may enter into equity contract for difference swap transactions for the purpose of increasing the income of the Fund. The use of swaps is a highly specialized activity that involves investment techniques and risks different from those associated with ordinary portfolio security transactions. In an equity contract for difference swap, a set of future cash flows is exchanged between two counterparties. One of these cash flow streams will typically be based on a reference interest rate combined with the performance of a notional value of shares of a stock. The other will be based on the performance of the shares of a stock. Depending on the general state of short term interest rates and the returns on the Fund’s portfolio securities at the time an equity contract for difference swap transaction reaches its scheduled termination date, there is a risk that the Fund will not be able to obtain a replacement transaction or that the terms of the replacement will not be as favorable as on the expiring transaction. At September 30, 2015, the Fund held no investments in equity contract for difference swap agreements.

Futures Contracts. The Fund may engage in futures contracts for the purpose of hedging against changes in the value of its portfolio securities and in the value of securities it intends to purchase. Upon entering into a futures contract, the Fund is required to deposit with the broker an amount of cash or cash equivalents equal to a certain percentage of the contract amount. This is known as the “initial margin.” Subsequent payments (“variation margin”) are made or received by the Fund each day, depending on the daily fluctuations in the value of the contract, and are included in unrealized appreciation/depreciation on futures contracts. The Fund recognizes a realized gain or loss when the contract is closed.

 

11


The Gabelli Equity Trust Inc.

Notes to Schedule of Investments (Unaudited) (Continued)

 

 

There are several risks in connection with the use of futures contracts as a hedging instrument. The change in value of futures contracts primarily corresponds with the value of their underlying instruments, which may not correlate with the change in value of the hedged investments. In addition, there is the risk that the Fund may not be able to enter into a closing transaction because of an illiquid secondary market. At September 30, 2015, the Fund held no investments in equity futures contracts.

Limitations on the Purchase and Sale of Futures Contracts, Certain Options, and Swaps. Subject to the guidelines of the Board, the Fund may engage in “commodity interest” transactions (generally, transactions in futures, certain options, certain currency transactions, and certain types of swaps) only for bona fide hedging or other permissible transactions in accordance with the rules and regulations of the Commodity Futures Trading Commission (“CFTC”). Pursuant to amendments by the CFTC to Rule 4.5 under the Commodity Exchange Act (“CEA”), the Adviser has filed a notice of exemption from registration as a “commodity pool operator” with respect to the Fund. The Fund and the Adviser are therefore not subject to registration or regulation as a commodity pool operator under the CEA. In addition, certain trading restrictions are now applicable to the Fund as of January 1, 2013. These trading restrictions permit the Fund to engage in commodity interest transactions that include (i) “bona fide hedging” transactions, as that term is defined and interpreted by the CFTC and its staff, without regard to the percentage of the Fund’s assets committed to margin and options premiums and (ii) non-bona fide hedging transactions, provided that the Fund does not enter into such non-bona fide hedging transactions if, immediately thereafter, either (a) the sum of the amount of initial margin deposits on the Fund’s existing futures positions or swaps positions and option or swaption premiums would exceed 5% of the market value of the Fund’s liquidating value, after taking into account unrealized profits and unrealized losses on any such transactions, or (b) the aggregate net notional value of the Fund’s commodity interest transactions would not exceed 100% of the market value of the Fund’s liquidating value, after taking into account unrealized profits and unrealized losses on any such transactions. Therefore, in order to claim the Rule 4.5 exemption, the Fund is limited in its ability to invest in commodity futures, options, and certain types of swaps (including securities futures, broad based stock index futures, and financial futures contracts). As a result, in the future, the Fund will be more limited in its ability to use these instruments than in the past, and these limitations may have a negative impact on the ability of the Adviser to manage the Fund, and on the Fund’s performance.

Investments in other Investment Companies. The Fund may invest, from time to time, in shares of other investment companies (or entities that would be considered investment companies but are excluded from the definition pursuant to certain exceptions under the 1940 Act) (the “Acquired Funds”) in accordance with the 1940 Act and related rules. Shareholders in the Fund would bear the pro rata portion of the periodic expenses of the Acquired Funds in addition to the Fund’s expenses. At September 30, 2015, the Fund’s pro rata portion of the periodic expenses charged by the Acquired Funds was less than 1 basis point.

Foreign Currency Translations. The books and records of the Fund are maintained in U.S. dollars. Foreign currencies, investments, and other assets and liabilities are translated into U.S. dollars at current exchange rates. Purchases and sales of investment securities, income, and expenses are translated at the exchange rate prevailing on the respective dates of such transactions. Unrealized gains and losses that result from changes in foreign exchange rates and/or changes in market prices of securities have been included in unrealized appreciation/depreciation on investments and foreign currency translations. Net realized foreign currency gains

 

12


The Gabelli Equity Trust Inc.

Notes to Schedule of Investments (Unaudited) (Continued)

 

 

and losses resulting from changes in exchange rates include foreign currency gains and losses between trade date and settlement date on investment securities transactions, foreign currency transactions, and the difference between the amounts of interest and dividends recorded on the books of the Fund and the amounts actually received. The portion of foreign currency gains and losses related to fluctuation in exchange rates between the initial purchase trade date and subsequent sale trade date is included in realized gain/(loss) on investments.

Foreign Securities. The Fund may directly purchase securities of foreign issuers. Investing in securities of foreign issuers involves special risks not typically associated with investing in securities of U.S. issuers. The risks include possible revaluation of currencies, the inability to repatriate funds, less complete financial information about companies, and possible future adverse political and economic developments. Moreover, securities of many foreign issuers and their markets may be less liquid and their prices more volatile than securities of comparable U.S. issuers.

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.

Restricted Securities. The Fund may invest up to 10% of its net assets in securities for which the markets are restricted. Restricted securities include securities whose disposition is subject to substantial legal or contractual restrictions. The sale of restricted securities often requires more time and results in higher brokerage charges or dealer discounts and other selling expenses than does the sale of securities eligible for trading on national securities exchanges or in the over-the-counter markets. Restricted securities may sell at a price lower than similar securities that are not subject to restrictions on resale. Securities freely saleable among qualified institutional investors under special rules adopted by the SEC may be treated as liquid if they satisfy liquidity standards established by the Board. The continued liquidity of such securities is not as well assured as that of publicly traded securities, and accordingly the Board will monitor their liquidity. At September 30, 2015, the Fund held no restricted securities.

Tax Information. The Fund intends to continue to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended.

 

13


THE GABELLI EQUITY TRUST INC.

One Corporate Center

Rye, NY 10580-1422

 

Portfolio Management Team Biographies

Mario J. Gabelli, CFA, is Chairman and Chief Executive Officer of GAMCO Investors, Inc. that he founded in 1977 and Chief Investment Officer – Value Portfolios of Gabelli Funds, LLC and GAMCO Asset Management Inc. Mr. Gabelli is a summa cum laude graduate of Fordham University and holds an MBA degree from Columbia Business School and Honorary Doctorates from Fordham University and Roger Williams University.

Christopher J. Marangi joined Gabelli in 2003 as a research analyst. He currently serves as a portfolio manager of Gabelli Funds, LLC and manages several funds within the Gabelli/GAMCO Fund Complex. Mr. Marangi graduated magna cum laude and Phi Beta Kappa with a BA in Political Economy from Williams College and holds an MBA with honors from Columbia Business School.

Kevin V. Dreyer joined Gabelli in 2005 as a research analyst covering companies within the consumer sector. He currently serves as a portfolio manager of Gabelli Funds, LLC and manages several funds within the Gabelli/GAMCO Fund Complex. Mr. Dreyer received a BSE from the University of Pennsylvania and an MBA from Columbia Business School.

Robert D. Leininger, CFA, joined GAMCO Investors, Inc. in 1993 as an equity analyst. Subsequently, he was a partner and portfolio manager at Rorer Asset Management before rejoining GAMCO in 2010 where he currently serves as a portfolio manager of Gabelli Funds, LLC and co-manages the Fund. Mr. Leininger is a magna cum laude graduate of Amherst College with a degree in Economics and holds an MBA from the Wharton School at the University of Pennsylvania.

Daniel M. Miller has been the portfolio manager of The Gabelli Focus Five Fund since inception of the investment strategy on January 1, 2012. He is also a Managing Director of GAMCO Asset Management and Chairman of Gabelli & Company, the firm’s institutional research business. Mr. Miller joined the firm in 2002 and graduated magna cum laude with a degree in finance from the University of Miami in Coral Gables, Florida.

 

 

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 content of the portfolio managers’ commentary is unrestricted. Both the commentary and the financial statements, including the portfolio of investments, will be available on our website at www.gabelli.com.

 

The Net Asset Value per share appears in the Publicly Traded Funds column, under the heading “General Equity Funds,” in Monday’s The Wall Street Journal. It is also listed in Barron’s Mutual Funds/Closed End Funds section under the heading “General Equity Funds.”

The Net Asset Value per share may be obtained each day by calling (914) 921-5070 or visiting www.gabelli.com.

The NASDAQ symbol for the Net Asset Value is “XGABX.”

 

 

Notice is hereby given in accordance with Section 23(c) of the Investment Company Act of 1940, as amended, that the Fund may, from time to time, purchase its common shares in the open market when the Fund’s shares are trading at a discount of 10% or more from the net asset value of the shares. The Fund may also, from time to time, purchase its preferred shares in the open market when the preferred shares are trading at a discount to the liquidation value.

 


 

THE GABELLI EQUITY TRUST INC.

One Corporate Center

Rye, NY 10580-1422

t   800-GABELLI (800-422-3554)

f   914-921-5118

e  info@gabelli.com

    GABELLI.COM

 

 

 

DIRECTORS

 

Mario J. Gabelli, CFA

Chairman & Chief Executive Officer,

GAMCO Investors, Inc.

 

Anthony J. Colavita

President,

Anthony J. Colavita, P.C.

 

James P. Conn

Former Managing Director &

Chief Investment Officer,

Financial Security Assurance

Holdings Ltd.

 

Frank J. Fahrenkopf, Jr.

Former President &

Chief Executive Officer,

American Gaming Association

 

Arthur V. Ferrara

Former Chairman &

Chief Executive Officer,

Guardian Life Insurance

Company of America

 

William F. Heitmann

Former Senior Vice President of Finance,

Verizon Communications, Inc.

 

Anthony R. Pustorino

Certified Public Accountant,

Professor Emeritus,

Pace University

 

Salvatore J. Zizza

Chairman,

Zizza & Associates Corp.

  

OFFICERS

 

Bruce N. Alpert

President

 

Andrea R. Mango

Secretary & Vice President

 

Agnes Mullady

Treasurer

 

Richard J. Walz

Chief Compliance Officer

 

Carter W. Austin

Vice President

 

Molly A.F. Marion

Vice President & Ombudsman

 

David I. Schachter

Vice President

 

INVESTMENT ADVISER

 

Gabelli Funds, LLC

One Corporate Center

Rye, New York 10580-1422

 

CUSTODIAN

 

The Bank of New York Mellon

 

COUNSEL

 

Willkie Farr & Gallagher LLP

 

TRANSFER AGENT AND

REGISTRAR

 

Computershare Trust Company, N.A.

  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  

 

 

 

 

GAB Q3/2015

LOGO

 


Item 2. Controls and Procedures.

 

  (a)

The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of the report that includes the disclosure required by this paragraph, based on their evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended (17 CFR 240.13a-15(b) or 240.15d-15(b)).

 

  (b)

There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d)) that occurred during the registrant’s last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.

 

Item 3. Exhibits.

Certifications pursuant to Rule 30a-2(a) under the 1940 Act and Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto.


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

(Registrant)  

    The Gabelli Equity Trust Inc.

By (Signature and Title)*  

  /s/ Bruce N. Alpert

  Bruce N. Alpert, Principal Executive Officer
Date  

    11/25/2015

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

By (Signature and Title)*  

  /s/ Bruce N. Alpert

        Bruce N. Alpert, Principal Executive Officer
Date  

    11/25/2015

By (Signature and Title)*  

  /s/ Agnes Mullady

        Agnes Mullady, Principal Financial Officer and Treasurer
Date  

    11/25/2015

* Print the name and title of each signing officer under his or her signature.