Ellsworth Growth and Income Fund Boosts Distribution by 23%
Ellsworth Growth and Income Fund Increases Cash Distribution
The Board of Trustees of Ellsworth Growth and Income Fund Ltd. has recently made a significant announcement regarding the quarterly cash distribution to its shareholders. In an impressive move, the Fund has raised the distribution amount from $0.13 per share to $0.16 per share. This marks a notable increase of 23%, demonstrating the Fund's strong performance in the market.
Details of the New Distribution
This new distribution will be payable to common shareholders on a specified date in the near future, targeting those who hold shares as of a certain record date. This adjustment brings the annual distribution rate to $0.64 from $0.52 per share, reflecting the Fund's successful strategies and solid positioning. Such decisions are often rooted in the fund's overall market performance, which saw a robust total return of 27% over the previous year.
Fund's Strategy for Distributions
The strategy behind distribution payments is closely monitored each quarter by the Board of Trustees. They take into account various factors, including income generated, realized capital gains, and the overall financial health of the Fund. If circumstances necessitate, the Fund has options to adjust distributions, especially towards the year's end, ensuring they align with their income and realized gains.
Tax Considerations for Shareholders
For individual investors, the nature of the distribution holds significance. Depending on various tax pieces, some or all of the cash distributions might be classified as long-term capital gain or qualified dividends. Understanding this can aid shareholders in effectively managing their tax implications. It’s crucial for shareholders to remain aware of their income tax position and potential Medicare surcharges that may apply based on their income levels.
Understanding Return of Capital
Investors should also be well-informed about the concept of return of capital. If the Fund's earnings do not cover the overall distributions within a given year, any excess distribution could be categorized as a return of capital, which is not typically taxable and acts as a reduction in the shareholder's cost basis. This is an important aspect for investors to grasp as it directly affects their tax situations.
Components of Distribution and Future Outlook
As a part of their transparency commitment, the Fund provides estimated components for their distributions each year, aiding shareholders in planning their tax strategies. Current projections suggest a division where a significant portion comes from net investment income and net capital gains. Marking this distinction is crucial, particularly as these allocations can shift as the year progresses. By the end of the fiscal year, the Fund will finalize these details, ensuring that shareholders have accurate information to work with.
Investors are encouraged to stay informed about the Fund's distribution policy and overall performance. This allows them to align their individual investment goals with the Fund's objectives, ensuring a favorable investment experience.
Connecting with Investor Relations
For any inquiries or further information about the Fund’s operations, Sarah Uhlein is readily available for discussions regarding investment goals and strategies. You can reach out through the provided contact details, ensuring that you have the right information to make informed decisions.
About Ellsworth Growth and Income Fund Ltd.
Ellsworth Growth and Income Fund Ltd. operates as a diversified, closed-end management investment company, managing approximately $186 million in assets. The Fund focuses on investing primarily in convertible securities and common stocks to generate consistent income while pursuing potential capital appreciation. It is funded and managed by Gabelli Funds, LLC, a reputable name in the investment management sector.
Frequently Asked Questions
What is the new distribution amount declared by the Fund?
The Fund has increased its quarterly distribution from $0.13 to $0.16 per share, a 23% increase.
When will the new distribution be payable?
The distribution will be payable to shareholders on a scheduled date, contingent on their record status.
What tax implications should shareholders consider?
Shareholders may need to account for long-term capital gains and qualified dividends, which have specific federal income tax rates.
How does the Fund determine their distribution policy?
The Board reviews distribution potential based on income, realized capital gains, and Fund performance regularly.
Who can investors contact for more information about their investments?
Investors can contact Bethany Uhlein for inquiries related to Fund policies and distribution details.
About The Author
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