Global Deal Is a Play on M&A

The closed-end (GDL Quote)Gabelli Global Deal Fund (GDL), which raised $370 million in an initial public offering last week, offers small investors another way to capitalize on the boom in corporate merger activity.

But don't expect to reap hedge-fund-like performance.

Although the strategy employed by merger funds is more commonly associated with private investment pools that cater to the wealthy, their returns are generally unexciting. The $207 million (GABCX Quote)Gabelli ABC Fund (GABCX), an open-end fund with a similar strategy that is run by the same manager, Mario Gabelli, is up 1.6% for the year through Wednesday and has returned an annualized 6.7% over the past three years, according to Morningstar. ...