GDL Fund : Recent Commentary

G A B E L L I

C LO S E D-E N D

S H A R E H O L D E R C O M M E N TA R Y

June 30, 2022

AT GABELLI FUNDS WE BELIEVE THE BEST FUND SHAREHOLDER IS AN INFORMED FUND SHAREHOLDER.

Dear Shareholders,

The second quarter of 2022 brought about an escalation of the themes we focused on in the first quarter Closed-End Fund Commentary. The geopolitical risks of the Ukraine invasion, the current inflationary environment and its unknown future direction, more rounds of Fed tightening, the movements of other central banks: these factors will affect not only our outlook but the health and direction of the companies we invest in. Some things will never change; we are, as always, bottom- up investors and add to our portfolios based on disciplined research and impeccable analysis. The commentary that follows showcases the thoughts and viewpoint of our portfolio management team.

This quarter, we feature the Mid-YearUtility Outlook from utility Portfolio Manager Tim Winter, an updated analysis of mobile operator T-Mobile from PM Sergey Dluzhevskiy, and media segments on Sports Investing in the Public Markets by PM Chris Marangi, among others. We invite you to call and request copies of these reports (as well as the quarterly update from our Convertibles team), and to read and listen online to our Insights and Podcasts.

The Gabelli Funds Investor Relations team is a dedicated resource for closed-end fund shareholders, financial professionals, and individual investors. The team may be reached by calling [phone] or by email ([e-mail]).

The main objective of our Investor Relations team is to be a valuable source for fund education and financial information. We seek to be an advocate for shareholders and provide your feedback to our portfolio teams, closed-end fund board members, and business leaders.

As always, we would like to thank you for entrusting us with a portion of your investments.

W W W . G A B E L L I . C O M

Visit us on the Internet. Our homepage at www.gabelli.com contains information about GAMCO Investors, Inc., the Gabelli/GAMCO closed-end funds and mutual funds, IRAs, 401(k)s, current and historical quarterly reports, closing prices, tax treatment of distributions, and other current news. We welcome your comments and questions, so call us or e-mail us at [e-mail].

Register for e-delivery at www.gabelli.com and receive notice of quarterly report availability, news events, media appearances, and mutual fund prices and performance.

INVESTOR RELATIONS TEAM

Molly A.F. Marion

GAB, GGN, GNT [phone] [e-mail]

BA, The University of Toronto

MBA, The George

Washington University

Carter W. Austin

GDV, GGT

[phone]

[e-mail] BA, Indiana University MBA, Georgetown University

Laurissa M. Martire

BCV, ECF, GCV,

GDL, GGN, GDV [phone] [e-mail] BA, University of

North Carolina, Charlotte

Bethany A. Uhlein

BCV, ECF, GCV

GGZ, GRX

[phone]

[e-mail] BS, Fairfield University

David I. Schachter

GNT, GUT

[phone]

[e-mail]

BA, Queens College

MA, New York University

Adam E. Tokar

GLU

[phone]

[e-mail]

BA, Gettysburg College

Daniel E. Hughes

[phone]

GGZ

[e-mail] BA, Harvard University

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TABLE OF CONTENTS

Insights from Your Value Portfolio Managers ...............................................................................................	4-5
Insights from Your Growth Portfolio Managers ...........................................................................................	6-7
The Gabelli Equity Trust Inc. (GAB) .................................................................................................................	8-9
The Gabelli Multimedia Trust Inc. (GGT) ...................................................................................................	10-11
Gabelli Healthcare & WellnessRx Trust (GRX) ...........................................................................................	12-13
Gabelli Utility Trust (GUT) ...............................................................................................................................	14-15
Gabelli Global Utility & Income Trust (GLU) ............................................................................................	16-17
The Gabelli Convertible and Income Securities Fund Inc. (GCV).....................................................	18-19
Ellsworth Growth and Income Fund Ltd. (ECF) .....................................................................................	20-21
Bancroft Fund Ltd. (BCV) ...............................................................................................................................	22-23
Gabelli Dividend & Income Trust (GDV).....................................................................................................	24-25
Gabelli Global Small and Mid Cap Value Trust (GGZ)...........................................................................	26-27
GAMCO Global Gold, Natural Resources & Income Trust (GGN) ....................................................	28-29
GAMCO Natural Resources, Gold & Income Trust (GNT)....................................................................	30-31
The GDL Fund (GDL) ........................................................................................................................................	32-33
Gabelli Financial Services Opportunities ETF (GABF) .............................................................................	34
Gabelli Automation ETF (GAST) ........................................................................................................................	35
Gabelli Growth Innovators ETF (GGRW) ........................................................................................................	36
Gabelli Love Our Planet & People ETF (LOPP)..............................................................................................	37
Gabelli ETFs Comparative Results......................................................................................................................	38
Contributors & Detractors......................................................................................................................................	39
Portfolio Management Team...........................................................................................................................	40-41
Directors / Trustees..................................................................................................................................................	42
Officers / Investment Adviser / Notes & Important Information ..........................................................	43

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Insights from Your Value Portfolio Managers

That '70s Show?

M A R K E T S I N T R O D U C T I O N

We were among those who drew comparisons between the emergence from COVID and the transition from the 1918 flu pandemic to the Roaring 1920s. Our analogy may have been off by half a century. A backdrop of 8% plus inflation, an oil shock, tensions with Russia, and social unrest at home may in fact be more reflective of the 1970s. The S&P 500 Index finished the first six months of 2022 down 20%, fittingly its worst showing since…1970. The market is discounting a lot of bad news, but each era presents its own issues and opportunities. At this point in the cycle, investors should be asking: How bad can things get? What can go right? What is priced in?

T H E S P E C T E R O F S TAG F L AT I O N

Economists often define inflation as too many dollars chasing too few goods. Both those conditions have been eminently true of late. Years of easy monetary policy formed the underbrush while $5 trillion in rescue stimulus, $5 trillion in quantitative easing, supply chain snafus, and pent-up demand triggered by COVID both provided the spark for an explosion in prices. The war in Ukraine, which has perhaps permanently altered global food and energy flows, accelerated the fire. Unfortunately, most central banks, including the Fed, entered this year behind the curve. In order to restore credibility and avoid the fate of 1970s Chair Arthur Burns, Jerome Powell has had to act aggressively with increases of 150 basis points over the last six months. The Fed can neither pump more oil nor harvest more wheat, but it can act on the demand side of the equation. Withdrawing liquidity increases the cost to purchase machinery, cars, homes, etc. and, in a reverse of the wealth effect, temper the animal spirits of consumers.

However, concerns about inflation are quickly morphing into worries about recession and worse, stagflation; the combination of slow/negative real growth and inflation that featured so prominently during the 1970s. After declining 1.9% in Q1 of 2022, real-time data from the Fed and surveys of corporate activity and consumer confidence suggest that Q2 GDP also contracted. While economists consider a range of factors in formally declaring recessions, two consecutive negative quarters might indicate that one has already begun. In contrast to prior recessions, the labor market remains tight. Several dynamics might augur a shallow contraction, including consumers starting with $2.7 trillion in savings and ample job prospects, supply chain issues slowly resolving, and the potential for détente in Ukraine. Indeed, a bull case for stocks could include a true normalization of the world, a grown up Goldilocks scenario with rates off the zero bound but not inhibiting consumption (mortgage rates in, say, the 5% range). Unfortunately, that may not be the base case or one only reached after an acute adjustment. Dislocations are painful but they are necessary capitalist course corrections, winnowing bad ideas, wringing out the excesses, and driving innovation in areas like energy production and labor productivity that set the stage for longer-term prosperity.

A VOLATILE MARKET DRIVEN BY MACRO HEADLINES

SHOULD ULTIMATELY PROVE A RICH ENVIRONMENT FOR ACTIVE MANAGEMENT AND FUNDAMENTAL VALUE STRATEGIES LIKE OURS.

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M R . M A R K E T

April and June brought some of biggest market declines in years as the reality of higher interest rates and the increasing prospect of a global slowdown took hold. While the rotation to Value that began in late 2021 continued into this year, by the end of Q2 there was no place to hide as energy stocks and other statistically cheap securities succumbed to the selling. For the quarter, large (Russell 1000) and small (Russell 2000) capitalization stocks both declined 17%, high grade bonds were down 7%, and gold retraced 3%. Notably, despite being peddled as an inflation hedge and portfolio diversifier, Bitcoin (not to mention its crypto copycats) has so far shown itself to be quite levered to growth equities, having declined over 50% in the quarter. No risk asset is exempt from the gravity of rising rates. Ten-year U.S. Treasury yields, which began the year at 1.52%, ended Q2 at 2.97% after touching 3.5% in early June, finally provided a reasonable alternative (albeit a negative real return) to investors married to the popular notion of TINA (There Is No Alternative [to equities]). We'll resist predicting the short-term direction of markets from here, but the process of re-establishing equilibrium will be volatile and subject to overshooting. We would suggest that, taking a longer-term perspective, the market as a whole looks attractive. In conjunction with the rise in rates, the forward P/E multiple on the S&P 500 has fallen from 21x to 16x. Although the earnings estimates underlying this arithmetic will decline, making the compression less stark, several other valuation measures put the market at an average valuation, despite rates still remaining historically low. Recall that even the great bull market of the 1990s took place under prevailing rates around 6%. As the quick market snap back from COVID in mid-2020 illustrated, timing the market is usually a fool's errand.

D E A L S , D E A L S & M O R E D E A L S

Rising rates and high levels of macroeconomic and regulatory uncertainty curtailed deal making in the first half of the year. Global announced M&A volume fell 21% to $2.2 trillion, though Q2 was the seventh consecutive quarter of volume above $1 trillion. Private equity firms actually increased their activity year-over-year and accounted for a record 26% of deals, including the buyouts of formerly high-flying technology companies such as Citrix Systems and Nielsen Holdings. We would expect PE firms to continue to put their dry powder to work at sometimes bargain valuations. We would also expect continued consolidation in industries undergoing secular change (e.g. media, fintech, biotech) and cyclical reshuffling (e.g. energy and materials), as well as financial engineering to address a changed competitive landscape.

C O N C L U S I O N

In the wake of such disappointing performance to start the year, it's worth noting that the market sits over 20% above where it ended 2019, an 8% CAGR over a very fraught time. We as a society may have moved past COVID, but its after-effects are still felt. Political, corporate, and individual actors still need to sort through a variety of issues. Economic and market conditions may worsen before they improve, but the risks are far more balanced today than they have been in some time.

A volatile market driven by macro headlines should ultimately prove a rich environment for active management and fundamental value strategies like ours. Cash flow and balance sheets matter most in these times of stress. Identifying companies with pricing power, manageable cost structures, and limited capital intensity that trade at discounts to Private Market Value should be a formula for success in times of inflation, recession, or both, no matter what the decade.

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