Ellsworth Growth and Income Fund Ltd. Declares Distribution of $0.16 per Share
MWN-AI** Summary
Ellsworth Growth and Income Fund Ltd. (NYSE American: ECF) announced a cash distribution of $0.16 per share, set to be paid on September 23, 2025, to investors holding shares as of September 16, 2025. The Fund's Board of Trustees annually evaluates its distribution strategy, which aims to provide at least 5% of the Fund's trailing 12-month average month-end market price or meet minimum distribution requirements under the Internal Revenue Code for regulated investment companies.
The decision to declare distributions each quarter considers various factors, including the Fund's net asset value and current market conditions. In December, an additional adjusting distribution may be provided to account for any surplus income or realized capital gains not reflected in earlier distributions. This policy is flexible and subject to alteration by the Board, emphasizing that there are no guarantees about future distributions.
It's important for shareholders to recognize that the distribution rate does not equate to a straightforward dividend yield or total return on their investment. The components of the distribution may be classified as long-term capital gains or qualified dividend income, which could be subject to different tax treatments, including a potential 3.8% Medicare surcharge on high-income earners.
For 2025, preliminary estimates suggest that distributions will consist of about 20% from net investment income and 80% from net capital gains, though final calculations will occur post fiscal year end. Shareholders will receive detailed tax reporting via Form 1099-DIV in early 2026.
Ellsworth Growth and Income Fund, managed by Gabelli Funds, LLC, focuses on convertible securities and common stocks, with total net assets of approximately $199 million, aiming to generate both income and capital appreciation for its investors.
MWN-AI** Analysis
Ellsworth Growth and Income Fund Ltd. (NYSE American: ECF) recently declared a cash distribution of $0.16 per share, reaffirming its commitment to delivering consistent returns to shareholders. This distribution will be payable on September 23, 2025, to common shareholders of record on September 16, 2025, indicating the fund's stable income-generating strategy.
The Fund's distribution strategy is anchored in its objective to provide income and potential capital appreciation through investments in convertible securities and common stocks. With a current net asset value of approximately $199 million, ECF aims to pay the greater of either an annual distribution of 5% of the Fund’s trailing 12-month average monthly market price or the minimum distribution mandated for regulated investment companies. This approach mirrors broader market trends where income-oriented investments are sought after, especially in a fluctuating interest rate environment.
Investors should note that roughly 20% of the 2025 distributions are expected to stem from net investment income, while 80% may derive from capital gains. Given the potential tax implications, such as the 20% federal capital gains tax and a possible 3.8% Medicare surcharge for higher-income individuals, shareholders should consider their personal tax situations when assessing net returns.
The distribution policy is adaptable and could change based on the Fund’s performance and market conditions, prompting shareholders to keep abreast of the Fund's quarterly reviews. Although the Fund's distribution rate may seem appealing, it should not be misconstrued as a direct measure of investment performance.
In summary, while Ellsworth Growth and Income Fund presents a compelling option for income-seeking investors due to its distribution framework, careful consideration of personal objectives, tax implications, and market conditions remains paramount before investing. For additional inquiries, stakeholders can reach out to Bethany Uhlein at Gabelli Funds, LLC for detailed insights and support.
**MWN-AI Summary and Analysis is based on asking OpenAI to summarize and analyze this news release.
RYE, N.Y., Aug. 27, 2025 (GLOBE NEWSWIRE) -- The Board of Trustees of Ellsworth Growth and Income Fund Ltd. (NYSE American: ECF) (the “Fund”) declared a $0.16 per share cash distribution payable on September 23, 2025 to common shareholders of record on September 16, 2025.
The Fund intends to pay the greater of either an annual distribution of 5% of the Fund’s trailing 12-month average month-end market price or an amount that meets the minimum distribution requirement of the Internal Revenue Code for regulated investment companies.
Each quarter, the Board of Trustees reviews the amount of any potential distribution from the income, realized capital gain, or capital available. The Board of Trustees will continue to monitor the Fund’s distribution level, taking into consideration the Fund’s net asset value and the current financial market environment. If necessary, the Fund pays an adjusting distribution in December, which includes any additional income and net realized capital gains in excess of the quarterly distributions. The Fund’s distribution policy is subject to modification or termination by the Board of Trustees at any time, and there can be no guarantee that the policy will continue. The distribution rate should not be considered the dividend yield or total return on an investment in the Fund.
All or part of the distribution may be treated as long-term capital gain or qualified dividend income (or a combination of both) for individuals, each subject to the maximum federal income tax rate for long term capital gains, which is currently 20% in taxable accounts for individuals (or less depending on an individual’s tax bracket). In addition, certain U.S. shareholders who are individuals, estates or trusts and with income that exceeds certain thresholds will be required to pay a 3.8% Medicare surcharge on their "net investment income", which includes dividends received from the Fund and capital gains from the sale or other disposition of shares of the Fund.
If the Fund does not generate sufficient earnings (dividends and interest income, less expenses, and realized net capital gain) equal to or in excess of the aggregate distributions paid by the Fund in a given year, then the amount distributed in excess of the Fund’s earnings would be deemed a return of capital. Since this would be considered a return of a portion of a shareholder’s original investment, it is generally not taxable and would be treated as a reduction in the shareholder’s cost basis.
Long-term capital gains, qualified dividend income, investment company taxable income and return of capital, if any, will be allocated on a pro-rata basis to all distributions to common shareholders for the year. Based on the accounting records of the Fund currently available, each of the distributions paid in 2025 to common shareholders with respect to the Fund’s fiscal year ending September 30, 2025 would include approximately 20% from net investment income and 80% from net capital gains on a book basis. This information does not represent information for tax reporting purposes. The estimated components of each distribution are updated and provided to shareholders of record in a notice accompanying the distribution and are available on our website (www.gabelli.com). The final determination of the sources of all distributions in 2025 will be made after year end and can vary from the quarterly estimates. Shareholders should not draw any conclusions about the Fund’s investment performance from the amount of the current distribution. All individual shareholders with taxable accounts will receive written notification regarding the components and tax treatment for all 2025 distributions in early 2026 via Form 1099-DIV.
Investors should carefully consider the investment objectives, risks, charges, and expenses of the Fund before investing. For more information regarding the Fund’s distribution policy and other information about the Fund, call:
Bethany Uhlein
(914) 921-5546
About Ellsworth Growth and Income Fund
Ellsworth Growth and Income Fund Ltd. is a diversified, closed-end management investment company with $199 million in total net assets. ECF invests primarily in convertible securities and common stock with the objectives of providing income and the potential for capital appreciation, objectives the Fund considers to be relatively equal over the long-term due to the nature of the securities in which it invests. The Fund is managed by Gabelli Funds, LLC, a subsidiary of GAMCO Investors, Inc. (OTCQX: GAMI).
NYSE American: ECF
CUSIP – 289074106
Investor Relations Contact:
Bethany Uhlein
914.921.5546
buhlein@gabelli.com
FAQ**
How does the distribution policy of Ellsworth Growth and Income Fund Ltd. ECF, including the potential for a return of capital, impact the long-term investment strategy for shareholders?
Can you elaborate on the factors the Board of Trustees considers when reviewing distributions for Ellsworth Growth and Income Fund Ltd. ECF?
What should investors take into account regarding taxes when they receive distributions from Ellsworth Growth and Income Fund Ltd. ECF, specifically concerning long-term capital gains?
Given that Ellsworth Growth and Income Fund Ltd. ECF's distribution policy can be modified, what indicators or market conditions might prompt changes to future distributions?
**MWN-AI FAQ is based on asking OpenAI questions about Ellsworth Growth and Income Fund Ltd. (NYSE: ECF).
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