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The Gabelli Small Cap Growth Fund (the "Fund") will close to new investors effective
October 1, 2002. Our Fund is rated 5 stars overall by Morningstar and for the three and
five-year periods ended March 31, 2002 among 5,040 and 3,293 domestic equity funds,
respectively, and 4 stars for the 10 year period among 926 domestic equity funds.
The Fund's policy is to invest its assets in small capitalization companies which are viewed
by the Adviser (Gabelli Funds, LLC) as companies with market capitalization of $1 billion or
less. "We believe it's in the best interest of the existing shareholders to restrict
investments from new shareholders, who have been flooding the small cap market with cash for
new investments," according to Mario J. Gabelli, Chief Investment Officer and Portfolio Manager
of the Fund. We prefer to benefit our existing shareholders with our stock selection process
and prowess.
Data from Lipper Inc. indicates the small cap market has grown from $135 billion to more than
$195 billion over the past twelve months with more than $40 billion of cash inflows. The Fund
is taking this step, anticipating the increasing cash flow into the small cap sector. At the
same time, the Fund will be seeking clarification from the Securities & Exchange Commission of
the appropriate definition of Small Cap. Other funds have increased the threshold of small
capitalization, even to over the $2.5 billion level, in order to find more companies in which
to invest and also to comply with the new SEC 35(d)-1 rule which requires funds to maintain
80% of their total assets in the specific category of investment as the name implies.
The Fund started in October 1991, had $370 million in assets on January 1, 2001 and now has
more than $540 million after appreciating 15.58% over the twelve months ending March 31, 2002.
The Gabelli Small Cap Growth Fund is managed by Gabelli Funds, LLC and distributed by
Gabelli & Company, Inc., a subsidiary of Gabelli Asset Management Inc. (GBL - NYSE), which is
a publicly traded NYSE listed company.
15.58%, 13.90%, 13.70% and 16.38% are the 1, 5, 10 year and life of fund
average annual total returns, respectively for the periods ending March 31, 2002. Past
Performance is no guarantee of future results. For more updated performance information or
to obtain a prospectus, please visit our website, www.gabelli.com
or contact a representative at Gabelli & Company, Inc. by calling 1-800-GABELLI (1-800-422-3554).
The information pertaining to Morningstar contained herein:
(1) is proprietary to Morningstar, (2) may not be copied or distributed; and
(3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its
content providers are responsible for any damages or losses arising from any use of this
information. Morningstar ratings reflect historical risk adjusted performance as of
3/31/02 and are subject to change every month. For each fund with at least a three-year
history, Morningstar calculates a Morningstar Rating TM
metric each month by subtracting the return on a 90-day U. S. Treasury Bill from the fund's
load-adjusted return for the same period, and then adjusting this excess return for risk.
The top 10% of funds in each broad asset class receive 5 stars, the next 22.5% receive
4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars and the bottom 10%
receive a star. The Overall Morningstar Rating for a fund is derived from a weighted average
of the performance figures associated with its three-, five- and ten-year (if applicable)
Morningstar Rating metrics. ©2002 Morningstar, Inc. All Rights Reserved.
Investment returns and the principal value of an investment will vary and shares when
redeemed may be worth more or less than their original cost. Investing in small
capitalization securities involves special challenges because these securities may trade
less frequently and experience more abrupt price movements than large capitalization
securities.
The prospectus contains more complete information including risks, fees and expenses.
Read it carefully before you invest or send money. |
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