Khanchit Khirisutchalual Introduction: General American Investors Co. Inc. ( NYSE: GAM ) is one of the nation's oldest closed-end funds ("CEFs"), incepted in 1927.
For over 95 years, the fund has managed a global portfolio of investments, consisting principally of common stocks of U. S. companies but also includes some international and private securities.
The fund is internally managed by General American Investors Company, Inc. The management focuses on the long-term appreciation of the NAV (net asset value) of the fund, and income is only a second consideration. In that sense, income from this fund is not very consistent.
Even then, if you look at the past several years, income from the fund has been significant, even if it was irregular. The average yield over 10 years has been in the range of 7.5%.
The only other fund that is very similar and also as old as GAM is Adams Diversified Equity Fund ( ADX ), which was founded in 1929. We reviewed that fund last week, and you can read that report here . The long-term performance of GAM has been excellent.
Over the last 50 years that ended Dec. 31, 2023, the fund has returned 12.7% per year (annualized) on the NAV basis (assuming reinvestment of all dividends and distributions).
During the same period, the S&P 500 ( SP500 ) has returned 11.2% (annualized, including reinvested dividends). The fund is internally managed and uses roughly 12% leverage in the form of preferred shares assets.
As per the fund's literature , " The prima.