UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
N-CSR
CERTIFIED
SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment
Company Act File Number:
811-02328
SRH
Total Return Fund, Inc.
(Exact
Name of Registrant as Specified in Charter)
1700
Broadway, Suite 1850
Denver, CO 80290
(Address of Principal Executive Offices) (Zip Code)
Chris
Moore
SRH Total Return Fund, Inc.
1700 Broadway, Suite 1850
Denver, CO 80290
(Name and Address of Agent for Service)
Registrant’s
Telephone Number, including Area Code:
(866) 228-4853
Date
of Fiscal Year End: November 30
Date
of Reporting Period: December 1, 2023 - May 31, 2024
Item
1. Reports to Stockholders.
(a)
The Report to Stockholders is attached herewith.
Distribution
Policy
May
31, 2024 (Unaudited)
SRH
Total Return Fund, Inc. (the “Fund”), acting pursuant to a Securities and Exchange Commission exemptive order and
with the approval of the Fund’s Board of Directors (the “Board”), has adopted a plan, consistent with its investment
objectives and policies to support a level distribution of income, capital gains and/or return of capital (the “Plan”).
In accordance with the Plan, the Fund distributed $0.1375 per share on a quarterly basis during the six-month period ended May
31, 2024. The fixed amount distributed per share is subject to change at the discretion of the Fund’s Board. Under the Plan,
the Fund will typically distribute most or all of its available investment income to its stockholders, consistent with its primary
investment objectives and as required by the Internal Revenue Code of 1986, as amended (the “Code”). The Fund may
also distribute long-term capital gains and short-term capital gains and return of capital to stockholders in order to maintain
a level distribution. Each quarterly distribution to stockholders is expected to be at the fixed amount established by the Board,
except for extraordinary distributions and potential distribution rate increases or decreases to enable the Fund to comply with
the distribution requirements imposed by the Code. Stockholders should not draw any conclusions about the Fund’s investment
performance from the amount of these distributions or from the terms of the Plan. The Fund’s total return performance on
net asset value is presented in its financial highlights table. The Board may amend, suspend or terminate the Fund’s Plan
without prior notice if it deems such action to be in the best interest of the Fund or its stockholders. The suspension or termination
of the Plan could have the effect of creating a trading discount (if the Fund’s stock is trading at or above net asset value)
or widening an existing trading discount. The Fund is subject to risks that could have an adverse impact on its ability to maintain
level distributions. Examples of potential risks include, but are not limited to, economic downturns impacting the markets, investments
in foreign securities, foreign currency fluctuations and changes in the Code. Please refer to the Fund’s annual report for
a more complete description of its risks.
| SRH Total
Return Fund, Inc. | Table
of Contents |
| Semi-Annual Report | May
31, 2024 | 1 |
| SRH Total
Return Fund, Inc. | Performance
Overview |
May
31, 2024 (Unaudited)
Semi-Annual
Update:
The
SRH Total Return Fund, Inc. (the “Fund”) generated a return of 14.00% on net assets in the six-month period ended
May 31, 2024 (the “Period”). Within the same Period, the S&P 500 Index returned 16.35%, the Dow Jones Industrial
Average (“DJIA”) returned 8.62%, and the Morningstar US Large Value Index returned 13.39%.
The
Fund has outperformed the DJIA and Morningstar US Large Value Index on an annualized net assets basis since affiliates of Rocky
Mountain Advisers, LLC (“RMA”) became investment advisers to the Fund in January of 2002. However, the Fund has underperformed
the S&P 500 Index on an annualized net assets basis during this same timeframe.
On
a market price basis, the Fund gained 10.53% for the period, underperforming the Fund’s return performance on a NAV basis
of 14.00%. At the beginning of the period the discount was -20.26% and at the end of the period the discount was -22.69%.
More
detail on various holding period returns can be found in the table below:
| |
3
months |
6
months |
One
Year |
Three
Years* |
Five
Years* |
Ten
Years* |
Since
January
2002** |
| STEW
(NAV) |
1.45% |
14.00% |
27.74% |
9.19% |
12.23% |
10.07% |
9.16% |
| STEW
(Market) |
-0.68% |
10.53% |
21.66% |
5.60% |
10.67% |
9.79% |
7.75% |
| S&P
500 Index† |
3.91% |
16.35% |
28.19% |
9.57% |
15.80% |
12.69% |
9.25% |
| DJIA†† |
-0.31% |
8.62% |
19.97% |
6.00% |
11.62% |
11.25% |
8.87% |
Morningstar
US Large
Value Index††† |
4.64% |
13.39% |
22.17% |
8.47% |
11.67% |
9.35% |
7.61% |
| ** | Annualized
since January 2002, when affiliates of RMA became investment advisers to the Fund. Does
not include the effect of dilution on non-participating stockholders from the December
2002 rights offering. |
| † | The
S&P 500 Index is widely regarded as the best single gauge of large-cap U.S. equities.
There is over USD 9.9 trillion indexed or benchmarked to the index, with indexed assets
comprising approximately USD 3.4 trillion of this total. The index includes 500 leading
companies and captures approximately 80% coverage of available market capitalization. |
| †† | The
Dow Jones Industrial Average (DJIA), is a price-weighted measure of 30 U.S. blue-chip
companies. The index covers all industries except transportation and utilities. |
| ††† | The
Morningstar US Large Value Index measures the performance of U.S. large-cap stocks with
relatively low prices given anticipated per-share earnings, book value, cash flow, sales
and dividends. This Index does not incorporate Environment, Social, or Governance (ESG)
criteria. |
The
performance data quoted represents past performance. Past performance is no guarantee of future results. Fund returns include
reinvested dividends and distributions, but do not reflect the reduction of taxes a stockholder would pay on Fund distributions
or the sale of Fund shares and do not reflect brokerage commissions, if any. Returns of the S&P 500 Index, the DJIA and Morningstar
US Large Value Index include reinvested dividends and distributions, but do not reflect the effect of commissions, expenses or
taxes, as applicable. You cannot invest directly in any of these indices. The investment return and the principal value of an
investment will fluctuate and shares, if sold, may be worth more or less than their original cost. Current performance may be
lower or higher than the performance data quoted.
| www.srhtotalreturnfund.com | 2 |
| SRH Total
Return Fund, Inc. | Performance
Overview |
May
31, 2024 (Unaudited)
The
first half of the year began with a sense of caution. The Federal Reserve's initial pronouncements suggested a "soft landing"
for the economy, with signs of slowing inflation providing a tailwind in equity markets. Investors, encouraged by the Fed’s
dovish tone, seemed to embrace the year with open arms. The stock market responded favorably, surging over 10% by April in a display
of bullish exuberance, with investor sentiment exceeding historical highs. However, despite the transparent dialogue from the
Fed and their mandate to price stability, the market has been optimistic about rate cuts being implemented sooner than later.
Additionally, investor sentiment around artificial intelligence (AI) appears to be the driving force around growth stocks. Nvidia
alone has contributed to more than one-third of the S&P 500’s advances this year, up over 170% YTD with a market cap
of $3.22 trillion. For perspective, Nvidia, Microsoft and Apple now have a combined market value over $9 trillion, surpassing
that of China’s total stock market.
For
the first half of the year, equity markets have been volatile and we do not expect that trend to change. Economic data continues
to post “mixed” results, the Federal Reserve is set on battling inflation, geopolitical tensions are rising, and,
to add another layer, the U.S. has an election year. However, in a high-rate environment and times of uncertainty, we believe
value stocks have better long-term opportunities due to the opportunity cost between current and potential future cash flows.
With respect to our stockholders, we continue to manage the Fund by sticking to our philosophy and adhering to the Fund’s
stated investment objective. At our core, our goal is to buy great companies at fair prices with the belief that they will continue
to compound earnings growth for the long run.
For
the third consecutive year, the Fund’s Board of Directors (“Board”) announced an increase in the Fund’s
quarterly distribution beginning in January 2024. In our opinion, the Fund’s managed distribution program fits the low turnover
buy-and-hold investment strategy both in its rate of growth and overall yield. In general, the distributions tend to be long-term
capital gains, because it is rare for the Fund to hold a position less than one year. RMA supports a distribution rate that is
moderate, not excessive, so that the per share NAV of the Fund can continue to increase over the long term.
The
largest contributors to performance during the period were Berkshire Hathaway, Inc. (BRK/A and BRK/B) contributing 5.13% combined
and JPMorgan Chase & Co (JPM) contributing 3.07% to the total return on net assets. The largest detractors to performance
during the period were Intel Corporation (INTC) detracting -1.00% and Inter Parfums, Inc. (IPAR) detracting -0.42% from the total
return on net assets.
During
the Period, the full position in NRG Energy Inc (NRG) was sold. New positions were started in Forward Air Corp (FWRD), First Watch
Restaurant Group Inc (FWRG) and Inter Parfums, Inc. (IPAR).
The
Fund repurchased and retired 327,126 shares of its Common Stock during the Period. The shares were repurchased at an average price
of $14.36. Since the Board reinstated the share repurchase program in August 2017, the Fund has repurchased and retired 9,355,469
shares at an average price of $10.48 per share.
| Semi-Annual
Report | May 31, 2024 | 3 |
| SRH Total
Return Fund, Inc. | Performance
Overview |
May
31, 2024 (Unaudited)
The
following table shows the top ten holdings in the Fund as of May 31, 2024:
| Holding |
Symbol(s) |
Percentage
of Total
Managed Assets |
| Berkshire
Hathaway, Inc. |
BRK/A
and BRK/B |
38.5% |
| JPMorgan
Chase & Co. |
JPM |
10.2% |
| Yum!
Brands, Inc. |
YUM |
5.8% |
| Cash
and Short-Term Investments |
OPGXX |
5.1% |
| Enterprise
Products Partners LP |
EPD |
4.1% |
| Microsoft
Corp. |
MSFT |
3.2% |
| Cohen
& Steers Infrastructure Fund, Inc. |
UTF |
3.0% |
| Evercore,
Inc., Class A |
EVR |
2.9% |
| Stanley
Black & Decker, Inc. |
SWK |
2.8% |
| Cisco
Systems, Inc. |
CSCO |
2.7% |
As
always, we appreciate your continued support of the Fund.
Sincerely,
 |  |
Joel Looney
Portfolio Manager | Jacob
Hemmer
Portfolio Manager |
The
views and opinions in the preceding commentary are as of the date of this letter and are subject to change at any time. This material
represents an assessment of the market environment at a specific point in time, should not be relied upon as investment advice
and is not intended to predict or depict performance of any investment.
Portfolio
weightings and other figures in the foregoing commentary are provided as of period-end, unless otherwise stated.
Note
to Stockholders on the Fund’s Discount. As most stockholders are aware, the Fund’s shares presently trade at a
significant discount to net asset value. The Board is aware of this, monitors the discount and periodically reviews the limited
options available to mitigate the discount. In addition, there are several factors affecting the Fund’s discount over which
the Board and management have little control. In the end, the market sets the Fund’s share price. For long-term stockholders
of a closed-end fund, we believe the Fund’s discount should only be one of many factors taken into consideration at the
time of your investment decision.
Note
to Stockholders on Concentration of Investments. The Board feels it is important that stockholders be aware of the Fund’s
high concentration in a small number of positions. Concentrating investments in fewer securities may involve a degree of risk
that is greater than a fund having less concentrated investments spread over a greater number of securities. In particular, the
Fund is highly concentrated in Berkshire Hathaway, Inc., which, in addition to other business risks, is largely dependent on Warren
Buffett for major investment and capital allocation decisions. When Mr. Buffett is no longer able to fulfill his responsibilities
with Berkshire Hathaway, Inc., the value of the Fund’s position in Berkshire Hathaway, Inc. could be materially impacted.
| www.srhtotalreturnfund.com | 4 |
| SRH Total
Return Fund, Inc. | Performance
Overview |
May
31, 2024 (Unaudited)
Growth
of $10,000 (May 31, 2014 through May 31, 2024)
Comparison
of change in value of a hypothetical $10,000 investment in the Fund and the Underlying Indexes
Past
performance does not guarantee future results. Performance will fluctuate with changes in market conditions. Current performance
may be lower or higher than the performance data shown. Performance information does not reflect the deduction of taxes that stockholders
would pay on Fund distributions or the sale of Fund shares. An investment in the Fund involves risk, including loss of principal.
| Semi-Annual Report | May
31, 2024 | 5 |
| SRH Total
Return Fund, Inc. | Performance
Overview |
May
31, 2024 (Unaudited)
The
table below is a summary of the distributions paid for the six months ended May 31, 2024.
| | | |
Net
Asset
Value | | |
Per
Share of
Common Stock
Market Price | | |
Distribution
Paid* | |
| 1/31/2024 | | |
$ | 17.79 | | |
$ | 14.06 | | |
$ | 0.1375 | |
| 4/30/2024 | | |
| 18.27 | | |
| 14.25 | | |
| 0.1375 | |
| * | Please
refer to page 26 for classifications of distributions. |
INVESTMENTS
AS A % OF NET ASSETS
APPLICABLE
TO COMMON STOCKHOLDERS
Holdings
are subject to change
| www.srhtotalreturnfund.com | 6 |
| SRH
Total Return Fund, Inc. |
Statement
of Investments |
May
31, 2024 (Unaudited)
| Description |
Shares |
Value
(Note 2) |
| LONG TERM INVESTMENTS
- 106.17% |
| |
|
| DOMESTIC COMMON STOCK - 96.88% |
| |
|
| Capital Goods - 3.25% |
| |
|
| Stanley
Black & Decker, Inc. |
680,000 | |
$59,275,600 |
| |
| |
|
| Construction Machinery
- 1.86% |
| |
|
| Caterpillar, Inc. |
100,000 | |
33,852,000 |
| |
| |
|
| Consumer Discretionary
Distribution - 1.94% |
| |
|
| eBay, Inc. |
650,000 | |
35,243,000 |
| |
| |
|
| Consumer Services
- 7.45% |
| |
|
| First
Watch Restaurant Group, Inc.(a) |
900,000 | |
17,712,000 |
| Yum!
Brands, Inc. |
858,000 | |
117,914,940 |
| |
| |
135,626,940 |
| Consumer Staples
Distribution - 1.79% |
| |
|
| Walmart, Inc. |
495,000 | |
32,551,200 |
| |
| |
|
| Diversified - 43.27% |
| |
|
| Berkshire
Hathaway, Inc., Class A(a)(b) |
1,028 | |
644,967,200 |
| Berkshire
Hathaway, Inc., Class B(a)(b) |
345,000 | |
142,968,000 |
| |
| |
787,935,200 |
| Diversified Financial
Services - 20.91% |
| |
|
| American
Express Co.(c) |
105,000 | |
25,200,000 |
| Charles
Schwab Corp.(c) |
750,000 | |
54,960,000 |
| Evercore, Inc.,
Class A |
300,000 | |
60,882,000 |
| JPMorgan Chase
& Co. |
1,028,000 | |
208,303,640 |
| PayPal
Holdings, Inc.(a) |
500,000 | |
31,495,000 |
| |
| |
380,840,640 |
| Healthcare Products
& Services - 1.44% |
| |
|
| Johnson &
Johnson |
179,100 | |
26,268,597 |
| |
| |
|
| Household & Personal
Products - 1.91% |
| |
|
| Inter Parfums,
Inc. |
290,000 | |
34,736,200 |
| |
| |
|
| Insurance - 2.61% |
| |
|
| Travelers Cos.,
Inc. |
220,000 | |
47,454,000 |
| |
| |
|
| Semiconductors - 2.03% |
| |
|
| Intel Corp. |
1,200,000 | |
37,020,000 |
See
Accompanying Notes to Financial Statements.
| Semi-Annual
Report | May 31, 2024 |
7 |
| SRH
Total Return Fund, Inc. |
Statement
of Investments |
May
31, 2024 (Unaudited)
| Description |
Shares |
Value
(Note 2) |
| Software & Tech
Services - 4.56% |
| |
|
| Microsoft
Corp. |
200,000 | |
$83,026,000 |
| |
| |
|
| Technology, Hardware
& Equipment - 3.17% |
| |
|
| Cisco Systems,
Inc. |
1,240,000 | |
57,660,000 |
| |
| |
|
| Transportation - 0.69% |
| |
|
| Forward Air Corp. |
750,000 | |
12,600,000 |
| |
| |
|
| TOTAL DOMESTIC COMMON
STOCK |
| |
|
| (Cost $560,433,903) |
| |
1,764,089,377 |
| |
| |
|
| CLOSED-END FUNDS - 3.58% |
| |
|
| Cohen
& Steers Infrastructure Fund, Inc. |
2,750,000 | |
65,229,999 |
| |
| |
|
| TOTAL CLOSED-END
FUNDS |
| |
|
| (Cost $37,425,470) |
| |
65,229,999 |
| |
| |
|
| LIMITED PARTNERSHIPS - 5.71% |
| |
|
| Enterprise
Products Partners LP |
3,650,000 | |
104,025,000 |
| |
| |
|
| TOTAL LIMITED PARTNERSHIPS |
| |
|
| (Cost $71,009,752) |
| |
104,025,000 |
| |
| |
|
| TOTAL LONG TERM INVESTMENTS |
| |
|
| (Cost $668,869,125) |
| |
1,933,344,376 |
See
Accompanying Notes to Financial Statements.
| www.srhtotalreturnfund.com | 8 |
| SRH
Total Return Fund, Inc. |
Statement
of Investments |
May
31, 2024 (Unaudited)
| Description |
Shares |
Value
(Note 2) |
| SHORT
TERM INVESTMENTS - 6.45% |
| |
|
| MONEY
MARKET FUNDS - 6.45% |
| |
|
| State
Street Institutional U.S. Government Money Market Fund, Opportunity Class, 7-Day Yield - 5.22% |
117,509,148 | |
$117,509,148 |
| |
| |
|
| TOTAL
MONEY MARKET FUNDS |
| |
|
| (Cost
$117,509,148) |
| |
117,509,148 |
| |
| |
|
| TOTAL
SHORT TERM INVESTMENTS |
| |
|
| (Cost
$117,509,148) |
| |
117,509,148 |
| |
| |
|
| TOTAL
INVESTMENTS - 112.62% |
| |
2,050,853,524 |
| (Cost $786,378,273) |
| |
|
| |
| |
|
| SENIOR
NOTES (NET OF DEFERRED OFFERING COST OF $1,545,517) - (12.27%) |
| |
(223,454,483) |
| |
| |
|
| OTHER
ASSETS AND LIABILITIES, NET - (0.35%) |
| |
(6,416,440) |
| |
| |
|
| NET
ASSETS APPLICABLE TO COMMON STOCKHOLDERS - 100.00% |
| |
$1,820,982,601 |
| (a) | Non-income
producing security. |
| (b) | For
additional information on portfolio concentration, see Note 6. |
| (c) | A
portion of the security is held as collateral for the written call options in the amount
of $6,303,850. |
Percentages
are stated as a percent of Net Assets Applicable to Common Stockholders.
Written
Call Options:
| Description |
Exercise
Price |
Premiums
Received |
Expiration
Date |
Number
of
Contracts |
Notional
Value |
Value
(Note 2) |
| American
Express Co. |
$190 |
$1,782,312 |
1/17/2025 |
(1,050) |
$(25,200,000) |
$(5,960,850) |
| Charles
Schwab Corp. |
75 |
2,230,395 |
6/21/2024 |
(3,500) |
(25,648,000) |
(343,000) |
| |
|
$4,012,707 |
|
|
$(50,848,000) |
$(6,303,850) |
See
Accompanying Notes to Financial Statements.
| Semi-Annual
Report | May 31, 2024 |
9 |
| SRH
Total Return Fund, Inc. |
Statement
of Assets and Liabilities |
May
31, 2024 (Unaudited)
| ASSETS: | |
|
| Total Investments at Value | |
| | |
| Cost ($786,378,273) | |
$ | 2,050,853,524 | |
| Receivable for investments sold | |
| 526,473 | |
| Dividends and interest receivable | |
| 1,529,304 | |
| Prepaid
expenses and other assets | |
| 106,145 | |
| Total
Assets | |
| 2,053,015,446 | |
| | |
| | |
| LIABILITIES: | |
| | |
| Written options, at value | |
| | |
| (Premiums received
$4,012,707) | |
| 6,303,850 | |
| Senior notes (net of deferred offering
cost of $1,545,517) (Note 10) | |
| 223,454,483 | |
| Investment advisory fees payable (Note
4) | |
| 1,541,862 | |
| Interest payable on senior notes (Note
10) | |
| 448,838 | |
| Administration fees payable (Note 4) | |
| 153,650 | |
| Printing fees payable | |
| 81,498 | |
| Custody fees payable | |
| 7,173 | |
| Legal fees payable | |
| 2,131 | |
| Audit and tax fees payable | |
| 21,331 | |
| Directors’ fees and expenses payable
(Note 4) | |
| 13,837 | |
| Accrued
expenses and other payables | |
| 4,192 | |
| Total
Liabilities | |
| 232,032,845 | |
| NET
ASSETS APPLICABLE TO COMMON STOCKHOLDERS | |
$ | 1,820,982,601 | |
| | |
| | |
| NET ASSETS (APPLICABLE
TO COMMON STOCKHOLDERS) CONSIST OF: | |
| | |
| Par value of common stock (authorized
249,990,000 shares at $0.01 par value) | |
$ | 967,414 | |
| Paid-in capital
in excess of par value of common stock | |
| 518,673,982 | |
| Total
distributable earnings | |
| 1,301,341,205 | |
| NET
ASSETS (APPLICABLE TO COMMON STOCKHOLDERS) | |
$ | 1,820,982,601 | |
| | |
| | |
| Net Asset Value, Per Share of Common Stock Outstanding | |
$ | 18.82 | |
| ($1,820,982,601/96,741,348 shares) | |
| | |
See
Accompanying Notes to Financial Statements.
| www.srhtotalreturnfund.com | 10 |
| SRH
Total Return Fund, Inc. |
Statement
of Operations |
For
the Six Months Ended May 31, 2024 (Unaudited)
| INVESTMENT INCOME: | |
|
| Dividends | |
$ | 15,346,648 | |
| Interest | |
| 3,699,771 | |
| Total
Investment Income | |
| 19,046,419 | |
| | |
| | |
| EXPENSES: | |
| | |
| Investment
advisory fees (Note 4) | |
| 8,949,598 | |
| Interest
on senior notes (Note 10) | |
| 3,070,624 | |
| Administration
fees (Note 4) | |
| 897,537 | |
| Directors’
fees and expenses (Note 4) | |
| 124,574 | |
| Printing
fees | |
| 47,658 | |
| Legal
fees | |
| 53,485 | |
| Custody
fees | |
| 24,366 | |
| Insurance
expense | |
| 24,204 | |
| Audit
and tax fees | |
| 23,031 | |
| Transfer
agency fees | |
| 24,382 | |
| Offering
costs (Note 10) | |
| 95,434 | |
| Other | |
| 101,180 | |
| Total
Expenses | |
| 13,436,073 | |
| Net
Investment Income | |
| 5,610,346 | |
| | |
| | |
| REALIZED
AND UNREALIZED GAIN/(LOSS) ON INVESTMENTS: | |
| | |
| Net
realized gain/(loss) on: | |
| | |
| Investments | |
| 28,235,816 | |
| Written
options | |
| 520,537 | |
| Net
realized gain | |
| 28,756,353 | |
| Net
change in unrealized appreciation/(depreciation) on: | |
| | |
| Investments | |
| 189,053,542 | |
| Written
options | |
| (4,763,538 | ) |
| Net
change in unrealized appreciation | |
| 184,290,004 | |
| NET
REALIZED AND UNREALIZED GAIN ON INVESTMENTS | |
| 213,046,357 | |
| NET
INCREASE IN NET ASSETS APPLICABLE TO COMMON STOCKHOLDERS RESULTING FROM OPERATIONS | |
$ | 218,656,703 | |
See
Accompanying Notes to Financial Statements.
| Semi-Annual
Report | May 31, 2024 |
11 |
| SRH
Total Return Fund, Inc. |
Statements
of Changes in Net Assets |
| | |
For
the
Six Months Ended
May 31, 2024
(Unaudited) | |
For
the
Year Ended
November 30, 2023 |
| | |
| |
|
| OPERATIONS: | |
| | | |
| | |
| Net
investment income | |
$ | 5,610,346 | | |
$ | 11,493,968 | |
| Net
realized gain on investments, written options and foreign currency transactions | |
| 28,756,353 | | |
| 44,240,641 | |
| Long-term
capital gain distributions from other investment companies | |
| — | | |
| 2,698,091 | |
| Net
change in unrealized appreciation on investments, written options and foreign currency translations | |
| 184,290,004 | | |
| 81,879,653 | |
| Net
Increase in Net Assets Applicable to Common Stockholders Resulting from Operations | |
| 218,656,703 | | |
| 140,312,353 | |
| | |
| | | |
| | |
| DISTRIBUTIONS
TO COMMON STOCKHOLDERS (NOTE 9): | |
| | | |
| | |
| From
distributable earnings | |
| (26,648,304 | ) | |
| (48,632,411 | ) |
| Total
Distributions: Common Stockholders | |
| (26,648,304 | ) | |
| (48,632,411 | ) |
| | |
| | | |
| | |
| CAPITAL
SHARE TRANSACTIONS (NOTE 8): | |
| | | |
| | |
| Repurchase
of fund shares | |
| (4,698,568 | ) | |
| (3,536,681 | ) |
| Net
Decrease in Net Assets from Capital Share Transactions | |
| (4,698,568 | ) | |
| (3,536,681 | ) |
| | |
| | | |
| | |
| Net
Increase in Net Assets Applicable to Common Stockholders | |
| 187,309,831 | | |
| 88,143,261 | |
| | |
| | | |
| | |
| NET
ASSETS: | |
| | | |
| | |
| Beginning
of period | |
| 1,633,672,770 | | |
| 1,545,529,509 | |
| End
of period | |
$ | 1,820,982,601 | | |
$ | 1,633,672,770 | |
See
Accompanying Notes to Financial Statements.
| www.srhtotalreturnfund.com | 12 |
| SRH
Total Return Fund, Inc. |
Statement
of Cash Flows |
For
the Six Months Ended May 31, 2024 (Unaudited)
| CASH FLOWS FROM OPERATING ACTIVITIES: | |
|
| Net increase in net assets
applicable to Common Stockholders resulting from operations | |
$ | 218,656,703 | |
| Adjustments to reconcile change in net
assets applicable to Common Stockholders resulting from operations to net cash provided by operating activities: | |
| | |
| Purchase of investment
securities | |
| (81,578,983 | ) |
| Net sales of short-term
investment securities | |
| 23,517,502 | |
| Proceeds from
disposition of investment securities | |
| 81,314,737 | |
| Premiums paid
on closing written options transactions | |
| (571,963 | ) |
| Premiums received
from written options transactions | |
| 1,782,312 | |
| Net realized (gain)/loss
on: | |
| | |
| Investments | |
| (28,235,816 | ) |
| Written options | |
| (520,537 | ) |
| Net change in unrealized (appreciation)/depreciation
on: | |
| | |
| Investments | |
| (189,053,542 | ) |
| Written options | |
| 4,763,538 | |
| Amortization of offering costs | |
| 95,433 | |
| (Increase)/Decrease in assets: | |
| | |
| Dividends and
interest receivable | |
| 1,027,369 | |
| Prepaid expenses
and other assets | |
| (33,815 | ) |
| Increase/(Decrease) in liabilities: | |
| | |
| Interest payable
on senior notes | |
| 11,874 | |
| Investment advisory
fees payable | |
| 197,091 | |
| Administration
fees payable | |
| 18,666 | |
| Directors’
fees and expenses payable | |
| 9,208 | |
| Legal fees payable | |
| (18,941 | ) |
| Audit and tax
fees payable | |
| (22,169 | ) |
| Custody fees payable | |
| (1,103 | ) |
| Printing fees
payable | |
| 1,154 | |
| Accrued
expenses and other payables | |
| (11,846 | ) |
| Net
Cash Provided by Operating Activities | |
| 31,346,872 | |
| | |
| | |
| CASH FLOWS FROM FINANCING
ACTIVITIES: | |
| | |
| Cash distributions paid to Common Stockholders | |
| (26,648,304 | ) |
| Repurchase of fund shares | |
| (4,698,568 | ) |
| Net
Cash Used in Financing Activities | |
| (31,346,872 | ) |
| | |
| | |
| Net increase in cash | |
| — | |
| Cash,
beginning balance | |
| — | |
| Cash,
ending balance | |
$ | — | |
| | |
| | |
| Cash paid for interest on senior notes
during the period was: | |
$ | 3,058,750 | |
See
Accompanying Notes to Financial Statements.
| Semi-Annual
Report | May 31, 2024 |
13 |
| SRH
Total Return Fund, Inc. |
Financial
Highlights |
Contained
below is selected data for a share of common stock outstanding, total investment return, ratios to average net assets and other
supplemental data for the periods indicated. This information has been determined based upon information provided in the financial
statements and market price data for the Fund’s shares.
| OPERATING
PERFORMANCE: |
| Net
asset value — Beginning of Period |
| INCOME
FROM INVESTMENT OPERATIONS: |
| Net
investment income(a) |
| Net
realized and unrealized gain/(loss) on investments |
| Net
Increase from Operations Applicable to Common Stockholders |
| DISTRIBUTIONS
TO COMMON STOCKHOLDERS |
| Distributions
from net investment income |
| Distributions
from net realized capital gains |
| Distributions
from tax return of capital |
| Total
Distributions Paid to Common Stockholders |
| CAPITAL
SHARE TRANSACTIONS: |
| Impact
of Capital Share Transactions(a) |
| Total
Capital Share Transactions |
| Net
Increase/(Decrease) in Net Asset Value |
| Common
Share Net Asset Value — End of Period |
| Common
Share Market Price— End of Period |
| Total
Return, Common Share Net Asset Value(b) |
| Total
Return, Common Share Market Price(b) |
| RATIOS
TO AVERAGE NET ASSETS APPLICABLE TO COMMON STOCKHOLDERS:(c) |
| Ratio
of operating expenses to average net assets including waiver |
| Ratio of operating
expenses to average net assets excluding waiver |
| Ratio
of operating expenses to average net assets excluding interest on borrowings |
| Ratio
of net investment income to average net assets including waiver |
| Ratio
of net investment income to average net assets excluding waiver |
| SUPPLEMENTAL
DATA: |
| Portfolio
turnover rate |
| Net
Assets Applicable to Common Stockholders, End of Period (000s) |
| Number
of Common Shares Outstanding, End of Period (000s) |
| BORROWINGS
AT END OF PERIOD |
| Aggregate
Amount of Senior Notes Outstanding (000s) |
| Asset
Coverage Per $1,000(h) |
See
Accompanying Notes to Financial Statements.
| www.srhtotalreturnfund.com | 14 |
| SRH
Total Return Fund, Inc. |
Financial
Highlights |
For
the Six
Months
Ended
May 31, 2024
(Unaudited) | |
For
the Year
Ended
November 30,
2023 | |
For
the Year
Ended
November 30,
2022 | |
For
the Year
Ended
November 30,
2021 | |
For
the Year
Ended
November 30,
2020 | |
For
the Year
Ended
November 30,
2019 |
| | |
| |
| |
| |
| |
|
| $ | 16.83 | | |
$ | 15.88 | | |
$ | 15.69 | | |
$ | 13.29 | | |
$ | 13.56 | | |
$ | 13.32 | |
| | | | |
| | | |
| | | |
| | | |
| | | |
| | |
| | 0.06 | | |
| 0.12 | | |
| 0.11 | | |
| 0.01 | | |
| 0.06 | | |
| 0.07 | |
| | 2.20 | | |
| 1.32 | | |
| 0.55 | | |
| 2.79 | | |
| (0.01 | ) | |
| 0.52 | |
| | 2.26 | | |
| 1.44 | | |
| 0.66 | | |
| 2.80 | | |
| 0.05 | | |
| 0.59 | |
| | | | |
| | | |
| | | |
| | | |
| | | |
| | |
| | (0.28 | ) | |
| (0.05 | ) | |
| (0.01 | ) | |
| — | | |
| (0.05 | ) | |
| (0.08 | ) |
| | — | | |
| (0.45 | ) | |
| (0.47 | ) | |
| (0.41 | ) | |
| (0.34 | ) | |
| (0.30 | ) |
| | — | | |
| — | | |
| — | | |
| — | | |
| (0.02 | ) | |
| (0.03 | ) |
| | (0.28 | ) | |
| (0.50 | ) | |
| (0.48 | ) | |
| (0.41 | ) | |
| (0.41 | ) | |
| (0.41 | ) |
| | | | |
| | | |
| | | |
| | | |
| | | |
| | |
| | 0.01 | | |
| 0.01 | | |
| 0.01 | | |
| 0.01 | | |
| 0.09 | | |
| 0.06 | |
| | 0.01 | | |
| 0.01 | | |
| 0.01 | | |
| 0.01 | | |
| 0.09 | | |
| 0.06 | |
| | 1.99 | | |
| 0.95 | | |
| 0.19 | | |
| 2.40 | | |
| (0.27 | ) | |
| 0.24 | |
| $ | 18.82 | | |
$ | 16.83 | | |
$ | 15.88 | | |
$ | 15.69 | | |
$ | 13.29 | | |
$ | 13.56 | |
| $ | 14.55 | | |
$ | 13.42 | | |
$ | 13.31 | | |
$ | 13.02 | | |
$ | 10.91 | | |
$ | 11.41 | |
| | 14.00 | % | |
| 10.06 | % | |
| 4.96 | % | |
| 21.86 | % | |
| 2.04 | % | |
| 5.60 | % |
| | 10.53 | % | |
| 4.71 | % | |
| 6.01 | % | |
| 23.18 | % | |
| (0.45 | %) | |
| 6.72 | % |
| | | | |
| | | |
| | | |
| | | |
| | | |
| | |
| | 1.52 | %(d) | |
| 1.60 | % | |
| 1.61 | % | |
| 1.65 | %(e) | |
| 1.16 | %(e) | |
| 1.11 | % |
| | 1.52 | %(d) | |
| 1.60 | % | |
| 1.61 | % | |
| 1.68 | % | |
| 1.17 | % | |
| 1.11 | % |
| | 1.17 | %(d) | |
| 1.20 | % | |
| 1.20 | % | |
| 1.24 | % | |
| 1.12 | % | |
| N/A | |
| | 0.63 | %(d) | |
| 0.74 | % | |
| 0.70 | % | |
| 0.07 | %(e) | |
| 0.52 | %(e) | |
| 0.54 | % |
| | 0.63 | %(d) | |
| 0.74 | % | |
| 0.70 | % | |
| 0.04 | % | |
| 0.51 | % | |
| 0.54 | % |
| | | | |
| | | |
| | | |
| | | |
| | | |
| | |
| | 4 | % | |
| 10 | % | |
| 10 | % | |
| 6 | % | |
| 6 | % | |
| 2 | % |
| $ | 1,820,983 | | |
$ | 1,633,673 | | |
$ | 1,545,530 | | |
$ | 1,534,631 | | |
$ | 1,305,895 | | |
$ | 1,392,553 | |
| | 96,741 | | |
| 97,068 | | |
| 97,333 | | |
| 97,802 | | |
| 98,271 | | |
| 102,676 | |
| | | | |
| | | |
| | | |
| | | |
| | | |
| | |
| $ | 225,000 | (f)(g) | |
$ | 225,000 | (f)(g) | |
$ | 223,169 | (f) | |
$ | 222,978 | (f) | |
$ | 222,749 | (f) | |
| N/A | |
| | 9,093 | | |
| 8,261 | | |
| 7,925 | | |
| 7,882 | | |
| 6,863 | | |
| N/A | |
See
Accompanying Notes to Financial Statements.
| Semi-Annual
Report | May 31, 2024 |
15 |
| SRH
Total Return Fund, Inc. |
Financial
Highlights |
| (a) | Calculated
based on the average number of common shares outstanding during each fiscal period. |
| (b) | Total
return based on per share net asset value reflects the effects of changes in net asset
value on the performance of the Fund during each fiscal period. Total return based on
common share market value assumes the purchase of common shares at the market price on
the first day and sale of common shares at the market price on the last day of the period
indicated. Dividends and distributions, if any, are assumed to be reinvested at prices
obtained under the Fund’s distribution reinvestment plan. |
| (c) | Ratios
do not reflect the proportionate share of income and expenses of the underlying investee
funds (i.e. those listed under Money Market Funds or Closed-End Funds on the Statement
of Investments). |
| (e) | Advisory,
sub-advisory and administration fees were voluntarily waived, on amounts attributable
to the proceeds of the senior notes issued that remained in cash or cash equivalents. |
| (f) | The
amount shown is due to the issuance of senior notes (See Note 10). |
| (g) | Principal
amount. Excludes the costs incurred in connection with the issuance of the senior notes. |
| (h) | Calculated
by subtracting the Fund’s total liabilities (excluding the principal amount of
the senior notes) from the Fund’s total assets and dividing by the principal amount
of the senior notes, then multiplying by $1,000. |
See
Accompanying Notes to Financial Statements.
| www.srhtotalreturnfund.com | 16 |
| SRH
Total Return Fund, Inc. |
Notes
to Financial Statements |
| |
May
31, 2024 (Unaudited) |
NOTE
1. FUND ORGANIZATION
SRH
Total Return Fund, Inc. (the “Fund” or “STEW”), is a non-diversified, closed-end management company organized
as a Maryland corporation and is registered with the Securities and Exchange Commission (“SEC”) under the Investment
Company Act of 1940, as amended (the “1940 Act”).
The
Fund is considered an investment company for financial reporting purposes under generally accepted accounting principles in the
United States of America (“GAAP”) and accordingly follows the investment company accounting and reporting guidance
in the Financial Accounting Standards Board Accounting Standards Codification Topic 946 “Financial Services – Investment
Companies.”
NOTE
2. SIGNIFICANT ACCOUNTING POLICIES
The
following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements.
The preparation of financial statements is in accordance with GAAP, which requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting
period. Actual results could differ from those estimates.
Portfolio
Valuation: Equity securities including closed-end funds and limited partnerships for which market quotations are readily available
(including securities listed on national securities exchanges and those traded over-the-counter) are valued based on the last
sales price at the close of the applicable exchange. If such equity securities were not traded on the valuation date, but market
quotations are readily available, they are valued at the bid price provided by an independent pricing service or by principal
market makers. Equity securities traded on NASDAQ are valued at the NASDAQ Official Closing Price. Debt securities are valued
at the mean between the closing bid and asked prices, or based on a matrix system which utilizes information (such as credit ratings,
yields and maturities) from independent pricing services, principal market makers, or other independent sources. Money market
mutual funds are valued at their net asset value per share. Short-term fixed income securities such as Commercial Paper, Bankers
Acceptances and U.S. Treasury Bills, having a maturity of less than 60 days are valued using market quotations or a matrix method
provided by a pricing service. If prices are not available from the pricing service, then the securities will be priced at fair
value under procedures approved by the Board of Directors (the “Board”). Pursuant to Rule 2a-5 under the 1940 Act,
the Board has designated the Fund's investment adviser, Paralel Advisors LLC ("Paralel" or the “Adviser”),
as the valuation designee (the "Valuation Designee") with respect to the fair valuation of the Fund's portfolio securities,
subject to oversight by and periodic reporting to the Board. Fair valued securities are those for which market quotations are
not readily available or where the pricing agent or market maker does not provide a valuation or methodology, or provides a valuation
or methodology that, in the judgment of the Adviser, does not represent fair value.
For
valuation purposes, the last quoted prices of non-U.S. equity securities may be adjusted under certain circumstances described
below. If the Valuation Designee determines that developments between the close of a foreign market and the close of the New York
Stock Exchange (“NYSE”) will, in its judgment, materially affect the value of some or all of the Fund’s portfolio
securities, the Valuation Designee may adjust the previous closing prices to reflect what it believes to be the fair value of
the securities as of the close of the NYSE. In deciding whether it is necessary to adjust closing prices to reflect fair value,
the Valuation Designee reviews a variety of factors, including developments in foreign markets, the performance of U.S. securities
markets, and the performance
| Semi-Annual
Report | May 31, 2024 |
17 |
| SRH
Total Return Fund, Inc. |
Notes
to Financial Statements |
| |
May
31, 2024 (Unaudited) |
of
instruments trading in U.S. markets that represent foreign securities and baskets of foreign securities. The Valuation Designee
may also fair value securities in other situations, such as when a particular foreign market is closed but the U.S. market is
open. The Valuation Designee may use outside pricing services to provide it with closing prices. The Valuation Designee may consider
whether it is appropriate, in light of relevant circumstances, to adjust such valuation in accordance with the Fund’s valuation
procedures. The Valuation Designee cannot predict how often it will use closing prices and how often it will determine it necessary
to adjust those prices to reflect fair value. If the Valuation Designee adjusts prices, the Valuation Designee will periodically
compare closing prices, the next day’s opening prices in the same markets and those adjusted prices as a means of evaluating
its security valuation process.
Options
are valued at the mean of the highest bid and lowest ask prices on the principal exchange on which the option trades. If no quotations
are available, fair value procedures will be used. Fair value procedures will also be used for any options traded over-the-counter.
Various
inputs are used to determine the value of the Fund's investments. Observable inputs are inputs that reflect the assumptions market
participants would use based on market data obtained from sources independent of the reporting entity. Unobservable inputs are
inputs that reflect the reporting entity’s own assumptions based on the best information available in the circumstances.
These
inputs are summarized in the three broad levels listed below.
Level
1 — Unadjusted quoted prices in active markets for identical investments that the Fund has the ability to access
Level
2 — Significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit
risk, etc.)
Level
3 — Significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)
| www.srhtotalreturnfund.com |
18 |
| SRH
Total Return Fund, Inc. |
Notes
to Financial Statements |
| |
May
31, 2024 (Unaudited) |
The
following is a summary of the Fund’s investments by inputs used to value those investments and other financial instruments
as of May 31, 2024:
Investments in Securities
at Value* | |
Level 1 | | |
Level 2 | | |
Level 3 | | |
Total | |
| Domestic Common Stock | |
$ | 1,764,089,377 | | |
$ | — | | |
$ | — | | |
$ | 1,764,089,377 | |
| Closed-End Funds | |
| 65,229,999 | | |
| — | | |
| — | | |
| 65,229,999 | |
| Limited Partnerships | |
| 104,025,000 | | |
| — | | |
| — | | |
| 104,025,000 | |
| Money Market Funds | |
| 117,509,148 | | |
| — | | |
| — | | |
| 117,509,148 | |
| TOTAL | |
$ | 2,050,853,524 | | |
$ | — | | |
$ | — | | |
$ | 2,050,853,524 | |
Other Financial
Instruments** | |
Level 1 | | |
Level 2 | | |
Level 3 | | |
Total | |
| Written Call Options | |
$ | (6,303,850 | ) | |
$ | — | | |
$ | — | | |
$ | (6,303,850 | ) |
| TOTAL | |
$ | (6,303,850 | ) | |
$ | — | | |
$ | — | | |
$ | (6,303,850 | ) |
| * | For
detailed descriptions and other security classifications, see the accompanying Statement
of Investments. |
| ** | Other
financial instruments are derivative instruments reflected in the Statement of Investments. |
Cash
and Cash Equivalents: Cash and cash equivalents may include demand deposits and highly liquid investments, typically with
original maturities of three months or less. Cash and cash equivalents are carried at cost, which approximates fair value.
Securities
Transactions and Investment Income: Securities transactions are recorded as of the trade date. Realized gains and losses from
securities sold are recorded on the identified cost basis. Dividend income is recorded as of the ex-dividend date or for certain
foreign securities, when the information becomes available to the Fund. Certain dividend income from foreign securities will be
recorded, in the exercise of reasonable diligence, as soon as the Fund is informed of the dividend if such information is obtained
subsequent to the ex-dividend date and may be subject to withholding taxes in these jurisdictions. Withholding taxes on foreign
dividends have been provided for in accordance with the Fund's understanding of the applicable country's tax rules and rates.
Non-cash dividends included in dividend income, if any, are recorded at the fair value of the securities received. Interest income,
including amortization of premium and accretion of discount on debt securities, as required, is recorded on the accrual basis
using the effective yield method.
Foreign
Currency Translations: The Fund may invest a portion of its assets in foreign securities. In the event that the Fund executes
a foreign security transaction, the Fund will generally enter into a forward foreign currency contract to settle the foreign security
transaction. Foreign securities may carry more risk than U.S. securities, such as political, market and currency risks. See Foreign
Issuer Risk under Note 6.
The
Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments
from the fluctuations arising from changes in market prices of securities held. Such fluctuations are included with the net realized
and unrealized gain or loss from investments. Reported net realized foreign exchange gains or losses arise from sales of foreign
currencies, currency gains or losses realized between the trade and settlement dates on securities transactions, and the difference
between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund's books and the U.S. dollar equivalent
of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in the fair values
of
| Semi-Annual
Report | May 31, 2024 |
19 |
| SRH
Total Return Fund, Inc. |
Notes
to Financial Statements |
| |
May
31, 2024 (Unaudited) |
assets
and liabilities, other than investments in securities at fiscal period-end, resulting from changes in exchange rates.
Distributions
to Common Stockholders: It is the Fund’s policy to distribute substantially all net investment income and net realized
gains to stockholders and to otherwise qualify as a regulated investment company under provisions of the Internal Revenue Code
of 1986, as amended. Distributions to common stockholders are recorded on the ex-dividend date.
The
Fund intends to distribute its net realized capital gains, if any, at least annually. At times, to maintain a stable level of
distributions, the Fund may pay out less than all of its net investment income or pay out accumulated undistributed income, or
return capital, in addition to current net investment income. Any distribution that is treated as a return of capital generally
will reduce a stockholder's basis in his or her shares, which may increase the capital gain or reduce the capital loss realized
upon the sale of such shares. Any amounts received in excess of a stockholder's basis are generally treated as capital gain, assuming
the shares are held as capital assets.
Indemnifications:
The Fund’s organizational documents provide that its officers and directors are indemnified against certain liabilities
arising out of the performance of their duties to the Fund. In addition, both in some of its principal service contracts and in
the normal course of its business, the Fund enters into contracts that provide indemnifications to other parties for certain types
of losses or liabilities. The Fund’s maximum exposure under these arrangements is unknown as this could involve future claims
against the Fund.
Federal
Income Tax: For federal income tax purposes, the Fund currently qualifies, and intends to remain qualified as a regulated
investment company under the provisions of Subchapter M of the Internal Revenue Code of 1986, as amended, by distributing substantially
all of its earnings to its stockholders. Accordingly, no provision for federal income or excise taxes has been made.
Income
and capital gain distributions are determined and characterized in accordance with income tax regulations, which may differ from
GAAP. These differences are primarily due to differing treatments of income and gains on various investment securities held by
the Fund, timing differences and differing characterization of distributions made by the Fund as a whole.
As
of and during the six months ended May 31, 2024, the Fund did not have a liability for any unrecognized tax benefits. The Fund
recognizes interest and penalties, if any, related to unrecognized tax benefits as income tax expenses, in the Statement of Operations.
The Fund files U.S. federal, state, and local tax returns as required. The Fund’s tax returns are subject to examination
by the relevant tax authorities until expiration of the applicable statute of limitations, which is generally three years after
the filing of the tax return for federal purposes and four years for most state returns. Tax returns for open years have incorporated
no uncertain tax positions that require a provision for income taxes.
NOTE
3. DERIVATIVE FINANCIAL INSTRUMENTS
As
a part of its investment strategy, the Fund may invest to a lesser extent in derivatives contracts. In doing so, the Fund will
employ strategies in differing combinations to permit them to increase, decrease, or change the level or types of exposure to
market factors. Central to those strategies are features inherent in derivatives that make them more attractive for this purpose
than equity or debt securities; they require little or no initial cash investment, they can focus exposure on only certain selected
risk factors, and they may not require the ultimate receipt or delivery of the underlying security (or securities) to the contract.
This may allow the Fund to pursue its objectives more quickly
| www.srhtotalreturnfund.com |
20 |
| SRH
Total Return Fund, Inc. |
Notes
to Financial Statements |
| |
May
31, 2024 (Unaudited) |
and
efficiently than if it were to make direct purchases or sales of securities capable of affecting a similar response to market
factors.
Risk
of Investing in Derivatives: The Fund’s use of derivatives can result in losses due to unanticipated changes in the
market risk factors and the overall market. In instances where the Fund is using derivatives to decrease, or hedge, exposures
to market risk factors for securities held by the Fund, there are also risks that those derivatives may not perform as expected,
resulting in losses for the combined or hedged positions.
Derivatives
may have little or no initial cash investment relative to their market value exposure and therefore can produce significant gains
or losses in excess of their cost. This use of embedded leverage allows the Fund to increase its market value exposure relative
to its net assets and can substantially increase the volatility of the Fund’s performance.
Associated
risks from investing in derivatives also exist and potentially could have significant effects on the valuation of the derivative
and the Fund. Typically, the associated risks are not the risks that the Fund is attempting to increase or decrease exposure to,
per its investment objectives, but are the additional risks from investing in derivatives.
Examples
of these associated risks are liquidity risk, which is the risk that the Fund will not be able to sell or close out the derivative
in a timely manner, and counterparty credit risk, which is the risk that the counterparty will not fulfill its obligation to the
Fund. In addition, use of derivatives may increase or decrease exposure to the following risk factors:
Equity
Risk: Equity risk relates to the change in value of equity securities as they relate to increases or decreases in the general
market. Associated risks can be different for each type of derivative and are discussed by each derivative type in the notes that
follow.
Option
Contracts: The Fund may enter into options transactions for hedging purposes and for non-hedging purposes such as seeking
to enhance return. The Fund may write put and call options on any stocks or stock indices, currencies traded on domestic and foreign
securities exchanges, or futures contracts on stock indices, interest rates and currencies traded on domestic and, to the extent
permitted by the Commodity Futures Trading Commission, foreign exchanges. A call option on an asset written by the Fund obligates
the Fund to sell the specified asset to the holder (purchaser) at a stated price (the exercise price) if the option is exercised
before a specified date (the expiration date). A put option on an asset written by the Fund obligates the Fund to buy the specified
asset from the purchaser at the exercise price if the option is exercised before the expiration date. Premiums received when writing
options are recorded as liabilities and are subsequently adjusted to the current value of the options written. Premiums received
from writing options that expire are treated as realized gains. Premiums received from writing options, which are either exercised
or closed, are offset against the proceeds received or amount paid on the transaction to determine realized gains or losses.
| Semi-Annual
Report | May 31, 2024 |
21 |
| SRH
Total Return Fund, Inc. |
Notes
to Financial Statements |
| |
May
31, 2024 (Unaudited) |
For
the six months ended May 31, 2024, the effects of derivative instruments on the Statement of Assets and Liabilities were as
follows:
| Risk Exposure | |
Asset Derivatives
Statement of
Assets and
Liabilities Location | |
Value | | |
Liability Derivatives
Statement of
Assets and
Liabilities Location | |
Value | |
Equity Contracts
(Written Options) | |
N/A | |
| N/A | | |
Written options, at value | |
$ | 6,303,850 | |
| Total | |
| |
| N/A | | |
| |
$ | 6,303,850 | |
For
the six months ended May 31, 2024, the effects of derivative instruments on the Statement of Operations were as follows:
| Risk Exposure | |
Statement of Operations Location | |
Realized Gain/
(Loss) on
Derivatives | | |
Change in
Unrealized
Appreciation on
Derivatives | |
Equity Contracts
(Written Options) | |
Net realized gain on written options/ Net change in unrealized appreciation on written options | |
$ | 520,537 | | |
$ | (4,763,538 | ) |
| Total | |
| |
$ | 520,537 | | |
$ | (4,763,538 | ) |
The
average notional value of written option contracts for the Fund was $47,298,767 during the six months ended May 31, 2024.
NOTE
4. ADVISORY FEES, ADMINISTRATION FEES AND OTHER AGREEMENTS
Paralel
serves as the Fund's investment adviser pursuant to an advisory agreement with the Fund. The Fund pays Paralel an annual fee,
calculated and paid monthly, equal to 0.90% of the first $2 billion of the Fund’s average Managed Assets, plus 0.80% of
the Fund’s average Managed Assets over $2 billion. "Managed Assets" means the total assets of the Fund, including
assets attributable to leverage, minus liabilities (other than debt representing leverage and any preferred stock that may be
outstanding).
Rocky
Mountain Advisers, LLC (“RMA”) provides sub-advisory services to the Fund pursuant to a sub-advisory agreement between
RMA and Paralel. Paralel, not the Fund, pays RMA an annual sub-advisory fee, calculated and paid monthly, equal to 0.77% of the
first $2 billion of the Fund’s average Managed Assets, plus 0.68% of the Fund’s average Managed Assets over $2 billion.
Paralel
Technologies LLC (“PRT”), an affiliate of Paralel, serves as the Fund’s administrator and provides all administrative
and fund accounting services to the Fund. As compensation for its services, PRT receives an annual fee, calculated and paid monthly,
equal to 0.09% of the first $2 billion of the Fund’s average Managed Assets, plus 0.075% of the Fund’s average Managed
Assets over $2 billion.
Paralel
is a wholly owned subsidiary of PRT. RMA may be deemed an affiliate of PRT and Paralel under the 1940 Act due to an indirect,
non-controlling investment in PRT by SLCT Holdings, LLC, a fully owned subsidiary of the Susan L. Ciciora Trust, which is also
the sole member of RMA. The Susan L. Ciciora Trust may be deemed an affiliate of the Fund.
| www.srhtotalreturnfund.com |
22 |
| SRH
Total Return Fund, Inc. |
Notes
to Financial Statements |
| |
May
31, 2024 (Unaudited) |
No
persons (other than the Independent Directors) receive compensation from the Fund for acting as a director or officer; however,
certain Directors and officers of the Fund are officers or employees of Paralel, RMA or PRT and may receive compensation in such
capacities. The Fund pays each member of the Board who is not a director, officer, employee, or affiliate of Paralel, RMA or PRT
or any of their affiliates (each an “Independent Director”) a fee of $40,000 per annum, plus $5,000 for each regular
quarterly meeting, $3,000 for each audit committee meeting, $1,000 for each nominating committee meeting and $1,000 for each telephonic
meeting of the Board. The Lead Independent Director of the Board receives an additional $3,125 for attending each regular quarterly
meeting of the Board. The chairman of the Audit Committee receives an additional $3,000 for attending each regular meeting of
the audit committee. The Fund will reimburse all Directors for travel and out-of-pocket expenses incurred in connection with such
meetings.
State
Street Bank & Trust Company (“State Street”) serves as the Fund’s custodian. Computershare Shareowner Services
(“Computershare”) serves as the Fund’s common stock servicing agent, dividend-paying agent and registrar. As
compensation for State Street’s and Computershare’s services, the Fund pays each a monthly fee plus certain out-of-pocket
expenses.
NOTE
5. SECURITIES TRANSACTIONS
Purchases
and sales of securities, excluding short term securities, during the six months ended May 31, 2024 were $81,578,983 and $81,841,210,
respectively.
NOTE
6. PORTFOLIO INVESTMENTS AND CONCENTRATION
Under
normal market conditions, the Fund intends to invest at least 80% of its net assets in common stocks. Common stocks include dividend-paying
closed-end funds, open-end funds and REITs. The portion of the Fund’s assets that are not invested in common stocks may
be invested in fixed income securities and cash equivalents. The term “fixed income securities” includes bonds, U.S.
Government securities, notes, bills, debentures, preferred stocks, convertible securities, bank debt obligations, repurchase agreements
and short-term money market obligations.
Concentration
Risk: The Fund operates as a “non-diversified” investment company, as defined in the 1940 Act. As a result of
being “non-diversified” with respect to 50% of the Fund’s portfolio, the Fund must limit the portion of its
assets invested in the securities of a single issuer to 5%, measured at the time of purchase. In addition, no single investment
can exceed 25% of the Fund’s total assets at the time of purchase. A more concentrated portfolio may cause the Fund’s
net asset value to be more volatile and thus may subject stockholders to more risk. Thus, the volatility of the Fund’s net
asset value and its performance in general, depends disproportionately more on the performance of a smaller number of holdings
than that of a more diversified fund. As a result, the Fund is subject to a greater risk of loss than a fund that diversifies
its investments more broadly.
As
of May 31, 2024, the Fund held more than 25% of its assets in Berkshire Hathaway, Inc. In addition to market appreciation of the
issuer since the time of purchase, the Fund acquired additional interest in Berkshire Hathaway, Inc. in the March 20, 2015 reorganization.
After the reorganization was completed, shares held of the issuer were liquidated to bring the concentration to 25%. Concentration
of the Berkshire Hathaway, Inc. position was a direct result of market appreciation and decreased leverage since the time the
Fund and the funds acquired in the reorganization purchased the security.
Foreign
Issuer Risk: Investment in non-U.S. issuers may involve unique risks compared to investing in securities of U.S. issuers.
These risks may include, but are not limited to: (i) less information about non-U.S. issuers or markets may be available due to
less rigorous disclosure, accounting standards
| Semi-Annual
Report | May 31, 2024 |
23 |
| SRH
Total Return Fund, Inc. |
Notes
to Financial Statements |
| |
May
31, 2024 (Unaudited) |
or
regulatory practices; (ii) many non-U.S. markets are smaller, less liquid and more volatile thus, in a changing market, the Fund’s
adviser may not be able to sell the Fund’s portfolio securities at times, in amounts and at prices they consider reasonable;
(iii) currency exchange rates or controls may adversely affect the value of the Fund’s investments; (iv) the economies of
non-U.S. countries may grow at slower rates than expected or may experience downturns or recessions; and, (v) withholdings and
other non-U.S. taxes may decrease the Fund’s return.
Market
Disruption Risk: The Fund is subject to investment and operational risks associated with financial, economic, and other global
market developments and disruptions.
NOTE
7. SIGNIFICANT STOCKHOLDERS
On
May 31, 2024, trusts and other entities and individuals affiliated with Stewart R. Horejsi and the Horejsi family owned 45,384,254
shares of Common Stock of the Fund, representing approximately 46.91% of the total Common Stock outstanding.
NOTE
8. SHARE REPURCHASES AND REDEMPTIONS
In
accordance with Section 23(c) of the 1940 Act and the rules promulgated thereunder, the Fund may from time to time effect repurchases
and/or redemptions of its Common Stock.
For
the six months ended May 31, 2024, the Fund repurchased 327,126 shares of Common Stock at a total purchase amount of $4,698,568
at an average discount of 21.46% of net asset value. For the year ended November 30, 2023, the Fund repurchased 264,644 shares
of Common Stock at a total purchase amount of $3,536,681 at an average discount of 18.93% of net asset value.
NOTE
9. TAX BASIS DISTRIBUTIONS AND TAX BASIS INFORMATION
The
amounts and characteristics of tax basis distributions and composition of distributable earnings/ (accumulated losses) are finalized
at fiscal year-end; accordingly, tax basis balances have not been determined as of May 31, 2024.
The
character of distributions paid on a tax basis during the year ended November 30, 2023 was as follows:
| Distributions Paid From: | |
| |
| Ordinary Income | |
$ | 9,944,584 | |
| Long-Term Capital Gain | |
| 38,687,827 | |
| | |
$ | 48,632,411 | |
The
amount of net unrealized appreciation/(depreciation) and the cost of investment securities for tax purposes at May 31, 2024 were
as follows:
| Cost of investments for income tax purposes | |
$ | 759,071,349 | |
| Gross appreciation on investments (excess of value over tax cost) | |
| 1,334,178,499 | |
| Gross depreciation on investments (excess of tax cost over value) | |
| (42,396,324 | ) |
| Net unrealized appreciation on investments | |
$ | 1,291,782,175 | |
| www.srhtotalreturnfund.com |
24 |
| SRH
Total Return Fund, Inc. |
Notes
to Financial Statements |
| |
May
31, 2024 (Unaudited) |
NOTE
10. SENIOR NOTES
On
November 5, 2020, the Fund issued senior unsecured notes (“Notes”) in an aggregate amount of $225,000,000 in three
fixed-rate series. The Notes were issued in private placement offerings to institutional investors and are not listed on any exchange
or automated quotation system. The note purchase agreement (the “Agreement”) contains various covenants related to
other indebtedness and limits on the Fund’s overall leverage. Under the 1940 Act and the terms of the Notes, the Fund may
not declare dividends or make other distributions on shares of its common stock or make purchases of such shares if, at any time
of the declaration, distribution or purchase, asset coverage with respect to senior securities representing indebtedness (including
the Notes) would be less than 300%.
The
table below sets forth a summary of the key terms of each series of Notes outstanding at May 31, 2024.
| Series | |
Principal
Outstanding
May 31, 2024 | | |
Payment
Frequency | |
Unamortized
Offering Costs | | |
Estimated
Fair Value
May 31, 2024 | | |
Fixed
Interest
Rate | | |
Maturity Date |
| A | |
$ | 85,000,000 | | |
Semi-Annual | |
$ | 540,427 | | |
$ | 70,665,524 | | |
| 2.62% | | |
November 5, 2030 |
| B | |
$ | 85,000,000 | | |
Semi-Annual | |
$ | 590,571 | | |
$ | 68,430,452 | | |
| 2.72% | | |
November 5, 2032 |
| C | |
$ | 55,000,000 | | |
Semi-Annual | |
$ | 414,519 | | |
$ | 42,568,163 | | |
| 2.87% | | |
November 5, 2035 |
The
Fund incurred costs in connection with the issuance of the Notes. These costs, totaling $2,226,190, were recorded as a deferred
charge and are being amortized over the respective life of each series of notes. Amortization of $95,434 is included as Offering
Costs on the Statement of Operations and the carrying amount on the Statement of Assets and Liabilities is equal to the principal
amount of the Notes less unamortized offering costs. The estimated fair value of the Notes was calculated, for disclosure purposes,
based on estimated market yields for comparable debt instruments with similar maturity and terms. The Fund categorizes the Notes
as Level 2 securities within the fair value hierarchy.
The
Fund shall at all times maintain a current rating given by a NRSRO (Nationally Recognized Statistical Rating Organization) of
at least Investment Grade with respect to the Notes and shall not at any time have any rating given by a NRSRO of less than Investment
Grade with respect to the Notes. The Notes have been assigned an ‘A’ long-term rating by Fitch Ratings.
At
May 31, 2024, the Fund was in compliance with all covenants under the Agreement.
| Semi-Annual
Report | May 31, 2024 |
25 |
| SRH
Total Return Fund, Inc. |
Additional
Information |
| |
May
31, 2024 (Unaudited) |
PORTFOLIO
INFORMATION
The
Fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year as an
exhibit to its report on Form N-PORT. The Fund’s N-PORT reports are available (i) on the Fund’s website at www.srhtotalreturnfund.com;
or (ii) on the SEC’s website at www.sec.gov; or (iii) by calling toll-free (877)-561-7914.
PROXY
VOTING
The
policies and procedures used by the Fund to determine how to vote proxies relating to portfolio securities held by the Fund are
available, without charge, (i) on the Fund’s website at www.srhtotalreturnfund.com, (ii) on the SEC’s website at www.sec.gov,
or (iii) by calling toll-free (877) 561-7914. Information regarding how the Fund voted proxies relating to portfolio securities
during the most recent twelve-month period ended June 30 is available at www.sec.gov.
SENIOR
OFFICER CODE OF ETHICS
The
Fund files a copy of its code of ethics that applies to its principal executive officer, principal financial officer or controller,
or persons performing similar functions (the “Senior Officer Code of Ethics”), with the SEC as an exhibit to its annual
report on Form N-CSR. The Fund’s Senior Officer Code of Ethics is available on the Fund’s website located at www.srhtotalreturnfund.com.
SECTION
19(A) NOTICES
The
following table sets forth the estimated amount of the sources of distribution for purposes of Section 19 of the Investment Company
Act of 1940, as amended, and the related rules adopted thereunder. The Fund estimates the following percentages, of the total
distribution amount per share, attributable to (i) current and prior fiscal year net investment income, (ii) net realized short-
term capital gain, (iii) net realized long-term capital gain and (iv) return of capital or other capital source as a percentage
of the total distribution amount. These percentages are disclosed for the fiscal year-to-date cumulative distribution amount per
share for the Fund.
The
amounts and sources of distributions reported in these 19(a) notices are only estimates and not for tax reporting purposes. The
actual amounts and sources of the amounts for tax reporting purposes will depend upon the Fund’s investment experience during
the remainder of its fiscal year and may be subject to changes based on tax regulations. The Fund will send you a Form 1099-DIV
for the calendar year that will tell stockholders how to report these distributions for federal income tax purposes.
Total
Cumulative Distributions for the six
months ended May 31, 2024 |
%
Breakdown of the Total Cumulative
Distributions for the six months ended
May 31, 2024 |
Net
Investment |
Net
Realized
Capital
Gains |
Return
of
Capital |
Total
Per
Common
Share |
Net
Investment
Income |
Net
Realized
Capital
Gains |
Return
of
Capital |
Total
Per
Common
Share |
| $0.03840 |
$0.14854 |
$0.08806 |
$0.27500 |
13.97% |
54.01% |
32.02% |
100.00% |
The
Fund estimates that it has distributed more than its income and net realized capital gains; therefore, a portion of the distribution
may be a return of capital. A return of capital may occur for example, when some or all of the money that you invested in the
Fund is paid back to stockholders.
| www.srhtotalreturnfund.com |
26 |
| SRH
Total Return Fund, Inc. |
Additional
Information |
| |
May
31, 2024 (Unaudited) |
A
return of capital distribution does not necessarily reflect the Fund's investment performance and should not be confused with
`yield' or `income.’
Stockholders
should not draw any conclusions about the Fund's investment performance from the amount of the distribution or from the terms
of the Fund's Plan.
DISCLAIMER
The
Fund is not sponsored, endorsed, sold or promoted by Morningstar, Inc. or any of its affiliates (all such entities, collectively,
“Morningstar Entities”). The Morningstar Entities make no representation or warranty, express or implied, to the owners
of the Fund or any member of the public regarding the advisability of investing in mutual funds generally or in the Fund in particular
or the ability of the Morningstar Index Data to track general mutual fund market performance.
THE
MORNINGSTAR ENTITIES DO NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE MORNINGSTAR INDEX DATA OR ANY DATA INCLUDED
THEREIN AND MORNINGSTAR ENTITIES SHALL HAVE NO LIABILITY FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS THEREIN.
| Semi-Annual
Report | May 31, 2024 |
27 |
| SRH
Total Return Fund, Inc. |
Summary
of Dividend
Reinvestment Plan |
| |
May
31, 2024 (Unaudited) |
Registered
holders (“Common Stockholders”) of common shares (the “Common Shares”) are automatically enrolled (the
“Participants”) in the Fund’s Dividend Reinvestment Plan (the “Plan”) whereupon all distributions
of income, capital gains or managed distributions (“Distributions”) are automatically reinvested in additional Common
Shares. Common Stockholders who elect to not participate in the Plan will receive all distributions in cash paid by check in U.S.
dollars mailed directly to the stockholders of record (or if the shares are held in street name or other nominee name, then the
nominee) by the custodian, as dividend disbursing agent.
Computershare
Shareowner Services (the “Agent”) serves as Agent for each Participant in administering the Plan. After the Fund declares
a Distribution, if (1) the net asset value per Common Share is equal to or less than the market price per Common Share plus estimated
brokerage commissions on the payment date for a Distribution, Participants will be issued Common Shares at the higher of net asset
value per Common Share or 95% of the market price per Common Share on the payment date; or if (2) the net asset value per Common
Share exceeds the market price plus estimated brokerage commissions on the payment date for a Distribution, the Agent shall apply
the amount of such Distribution to purchase Common Shares on the open market and Participants will receive the equivalent in Common
Shares valued at the weighted average market price (including brokerage commissions) determined as of the time of the purchase
(generally, following the payment date of the Distribution). If, before the Agent has completed its purchases, the market price
plus estimated brokerage commissions exceeds the net asset value of the Common Shares as of the payment date, the purchase price
paid by the Agent may exceed the net asset value of the Common Shares, resulting in the acquisition of fewer Common Shares than
if such Distribution had been paid in Common Shares issued by the Fund. If the Agent is unable to invest the full Distribution
amount in purchases in the open market or if the market discount shifts to a market premium during the purchase period then the
Agent may cease making purchases in the open market the instant the Agent is notified of a market premium and may invest the uninvested
portion of the Distribution in newly issued Common Shares at the net asset value per Common Share at the close of business provided
that, if the net asset value is less than or equal to 95% of the then current market price per Common Share, the dollar amount
of the Distribution will be divided by 95% of the market price on the payment date. The Fund will not issue Common Shares under
the Plan below net asset value.
There
is no charge to Participants for reinvesting Distributions, except for certain brokerage commissions, as described below. The
Agent’s fees for the handling of the reinvestment of Distributions will be paid by the Fund. There will be no brokerage
commissions charged with respect to shares issued directly by the Fund. However, each Participant will pay a pro rata share of
brokerage commissions incurred with respect to the Agent’s open market purchase in connection with the reinvestment of Distributions.
The automatic reinvestment of Distributions will not relieve Participants of any federal income tax that may be payable on such
Distributions.
The
Fund reserves the right to amend or terminate the Plan upon 90 days’ written notice to Common Stockholders of the Fund.
Participants
in the Plan may (i) request a certificate, (ii) request to sell their shares, or (iii) withdraw from the Plan upon written notice
to the Agent or by telephone in accordance with the specific procedures and will receive certificates for whole Common Shares
and cash for fractional Common Shares.
All
correspondence concerning the Plan should be directed to the Agent, Computershare Shareowner Services, P.O. Box 43078, Providence
RI 02940-3078. To receive a full copy of the Fund’s Dividend Reinvestment Plan, please contact the Agent at 1-866-228-4853.
| www.srhtotalreturnfund.com |
28 |
| DIRECTORS |
Richard
I. Barr
Thomas J. Moore
Joel W. Looney
Nicole L. Murphey
Steven K. Norgaard |
| |
|
INVESTMENT
ADVISER |
Paralel
Advisors LLC
1700 Broadway, Suite 1850
Denver, CO 80290 |
| |
|
SUB-INVESTMENT
ADVISER |
Rocky
Mountain Advisers, LLC
2121 E. Crawford Place
Salina, KS 67401 |
| |
|
| ADMINISTRATOR |
Paralel
Technologies LLC
1700 Broadway, Suite 1850
Denver, CO 80290 |
| |
|
| CUSTODIAN |
State
Street Bank and Trust
One Congress Street , Suite 1
Boston, MA 02114-2016 |
| |
|
STOCK
TRANSFER
AGENT |
Computershare
Inc.
150 Royall St., Suite 101
Canton, MA 02021 |
| |
|
INDEPENDENT
REGISTERED PUBLIC
ACCOUNTING FIRM |
Cohen
& Company, Ltd.
1350 Euclid Avenue, Suite 800
Cleveland, OH 44115 |
| |
|
| LEGAL
COUNSEL |
Paul
Hastings, LLP
515 South Flower Street
Twenty-Fifth Floor
Los Angeles, CA 90071 |
The
views expressed in this report and the information about the Fund’s portfolio holdings are for the period covered by this
report and are subject to change thereafter.
Statistics
and projections in this report are derived from sources deemed to be reliable but cannot be regarded as a representation of future
results of the Fund. This report is prepared for the general information of stockholders and is not a prospectus, circular or
representation intended for use in the purchase or sale of shares of the Fund or of any securities mentioned in this report.
www.srhtotalreturnfund.com
SRH
TOTAL RETURN FUND, INC.
c/o
Computershare
P.O. Box 43078
Providence, RI 02940-3078
(b)
Not applicable.
Item
2. Code of Ethics.
Not
applicable to the semi-annual report.
Item
3. Audit Committee Financial Expert.
Not
applicable to the semi-annual report.
Item
4. Principal Accountant Fees and Services.
Not
applicable to the semi-annual report.
Item
5. Audit Committee of Listed Registrants.
Not
applicable to the semi-annual report.
Item
6. Investments.
(a) The Registrant’s
full schedule of investments is included as part of the report to stockholders filed under Item 1 of this Form.
(b)
Not applicable.
Item
7. Financial Statements and Financial Highlights for Open-End Management Investment Companies.
Not
applicable to closed-end investment companies.
Item
8. Changes in and Disagreements with Accountants for Open-End Management Investment Companies.
Not
applicable to closed-end investment companies.
Item
9. Proxy Disclosures for Open-End Management Investment Companies.
Not
applicable to closed-end investment companies.
Item
10. Remuneration Paid to Directors, Officers, and Others of Open-End Management Investment Companies.
Not
applicable to closed-end investment companies.
Item
11. Statement Regarding Basis for Approval of Investment Advisory Contract.
None.
Item
12. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not
applicable to the semi-annual report.
Item
13. Portfolio Managers of Closed-End Management Investment Companies.
Not
applicable to the semi-annual report.
Item
14. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
| Period |
(a)
Total Number of Shares (or Units) Purchased |
(b)
Average Price Paid per Share (or Unit) |
(c)
Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs |
(d)
Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs |
| 12/1/23
- 12/31/23 |
56,056 |
$13.63 |
56,056 |
N/A |
| 1/1/24
- 1/31/24 |
30,709 |
$14.03 |
30,709 |
N/A |
| 2/1/24
- 2/29/24 |
70,137 |
$14.46 |
70,137 |
N/A |
| 3/1/24
- 3/31/24 |
57,642 |
$14.78 |
57,642 |
N/A |
| 4/1/24
- 4/30/24 |
60,959 |
$14.56 |
60,959 |
N/A |
| 5/1/24
- 5/31/24 |
51,623 |
$14.53 |
51,623 |
N/A |
On August
9, 2017, the Fund announced its reaffirmation of its share buyback program. Under the program, the Fund’s sub-adviser, RMA, has
the authority (but not the obligation) to repurchase the Fund’s common stock in the open market when shares are trading at a discount
to net asset value. RMA is authorized to use its discretion in repurchasing shares when market conditions warrant. The timing, manner,
price, and amount of any share repurchases will be determined by RMA in its discretion, based on the foregoing as well as applicable
legal and regulatory requirements and other factors, including the guidelines specified in Rule 10b-18 of the Securities Exchange Act
of 1934, as amended. The program may be suspended, extended, modified, or discontinued at any time.
Each of the
purchases in the table above have been made pursuant to the share buyback program described above.
Item
15. Submission of Matters to a Vote of Security Holders.
No material
changes to the procedures by which the stockholders may recommend nominees to the Registrant’s Board of Directors have been implemented
after the Registrant last provided disclosure in response to the requirements of Item 407(c)(2)(iv) of Regulation S-K (17 CFR 229.407)
(as required by Item 22(b)(15) of Schedule 14A (17 CFR 240.14a-101)), or this Item.
Item
16. Controls and Procedures.
(a) The Registrant’s
principal executive and principal financial officers, or persons performing similar functions, have concluded that the Registrant's disclosure
controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)
(17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of the report that includes the disclosure required
by this paragraph, based on their evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b))
and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended (17 CFR 240.13a-15(b) or 240.15d-15(b)).
(b) There
were no changes in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17
CFR 270.30a-3(d)) that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially
affect, the Registrant’s internal control over financial reporting.
Item
17. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.
None.
Item
18. Recovery of Erroneously Awarded Compensation.
None.
Item
19. Exhibits.
| (a)(1) | Not
applicable to the semi-annual report. |
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, as amended, and the Investment Company Act of 1940, as amended, the Registrant
has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| (Registrant) |
SRH
TOTAL RETURN FUND, INC. |
|
| By (Signature
and Title) |
/s/
Joel W. Looney |
|
| |
Joel W. Looney,
President
(Principal Executive Officer) |
| |
|
|
Pursuant
to the requirements of the Securities Exchange Act of 1934, as amended, and the Investment Company Act of 1940, as amended, this report
has been signed below by the following persons on behalf of the Registrant and in the capacities and on the date indicated.
| By
(Signature and Title) |
/s/
Joel W. Looney |
|
| |
Joel W. Looney,
President
(Principal Executive Officer) |
| By
(Signature and Title) |
/s/
Jill Kerschen |
|
| |
Jill Kerschen, Treasurer
(Principal Financial Officer) |
|
| |
SRH Total Return Fund, Inc. N-CSRS
Exhibit
99.302(i)CERT
CERTIFICATION
PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT
I, Joel W.
Looney, certify that:
1. I
have reviewed this report on Form N-CSR of SRH Total Return Fund, Inc.
2. Based
on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered
by this report;
3. Based
on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects
the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include
a statement of cash flows) of the Registrant as of, and for, the periods presented in this report;
4. The
Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures
(as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule
30a-3(d) under the Investment Company Act of 1940) for the Registrant and have:
(a) Designed
such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure
that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being prepared;
(b) Designed
such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision,
to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the financial statements for
external purposes in accordance with generally accepted accounting principles;
(c) Evaluated
the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on
such evaluation; and
(d) Disclosed
in this report any change in the Registrant’s internal control over financial reporting that occurred during the period covered
by this report that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over
financial reporting; and
5. The
Registrant’s other certifying officer and I have disclosed to the Registrant’s auditors and the audit committee of the Registrant’s
Board of Directors (or persons performing the equivalent functions):
(a) All significant
deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely
to adversely affect the Registrant’s ability to record, process, summarize, and report financial information; and
(b) Any fraud,
whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control
over financial reporting.
| Date: |
August 6, 2024 |
/s/ Joel W. Looney |
|
| |
Joel W. Looney, President |
| |
(Principal Executive Officer) |
Exhibit
99.302(ii) CERT
CERTIFICATION
PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT
I, Jill Kerschen,
certify that:
1. I
have reviewed this report on Form N-CSR of SRH Total Return Fund, Inc.;
2. Based
on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered
by this report;
3. Based
on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects
the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include
a statement of cash flows) of the Registrant as of, and for, the periods presented in this report;
4. The
Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures
(as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule
30a-3(d) under the Investment Company Act of 1940) for the Registrant and have:
(a) Designed
such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure
that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being prepared;
(b) Designed
such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision,
to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the financial statements for
external purposes in accordance with generally accepted accounting principles;
(c) Evaluated
the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on
such evaluation; and
(d) Disclosed
in this report any change in the Registrant’s internal control over financial reporting that occurred during the period covered
by this report that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over
financial reporting; and
5. The
Registrant’s other certifying officer and I have disclosed to the Registrant’s auditors and the audit committee of the Registrant’s
Board of Directors (or persons performing the equivalent functions):
(a) All significant
deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely
to adversely affect the Registrant’s ability to record, process, summarize, and report financial information; and
(b) Any fraud,
whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control
over financial reporting.
| Date: |
August 6, 2024 |
/s/ Jill Kerschen |
|
| |
|
Jill Kerschen, Treasurer |
| |
|
(Principal Financial Officer) |
SRH Total Return Fund, Inc. N-CSRS
Exhibit
99.906CERT
CERTIFICATIONS PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT
I, Joel W. Looney, President of SRH Total Return Fund, Inc. (the “Registrant”),
certify that:
1. The
Form N-CSR of the Registrant (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities
Exchange Act of 1934, as amended; and
2. The
information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the
Registrant.
| Date: |
August 6, 2024 |
/s/ Joel W. Looney |
|
| |
Joel W. Looney, President |
| |
(Principal Executive Officer) |
I, Jill Kerschen, Treasurer of SRH Total Return Fund, Inc. (the “Registrant”),
certify that:
1. The
Form N-CSR of the Registrant (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities
Exchange Act of 1934, as amended; and
2. The
information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the
Registrant.
| Date: |
August 6, 2024 |
/s/ Jill Kerschen |
|
| |
Jill Kerschen, Treasurer |
| |
(Principal Financial Officer) |
SRH Total Return Fund, Inc. N-CSRS
Exhibit
99(19)(c)
Notification
of Sources of Distribution
Statement
Pursuant to Section 19(a) of the Investment Company Act of 1940
Denver,
CO/ACCESSWIRE/January 31, 2024/ On January 31, 2024, SRH Total Return Fund, Inc. (NYSE: STEW) (the “Fund”), a closed-end
investment company, will pay a distribution on its common stock of $0.1375 per share to stockholders of record at the close of business
on January 24, 2024. The Fund, acting in accordance with an exemptive order received from the Securities and Exchange Commission and
with approval of its Board of Directors, adopted a managed distribution policy under which the Fund may utilize capital gains, where
applicable, as part of regular quarterly cash distributions to its stockholders. This policy gives the Fund greater flexibility to realize
capital gains and to distribute those gains to stockholders.
The
following table sets forth the estimated amounts of the current distribution and the cumulative distributions paid this fiscal year-to-date
from the sources indicated in the table. In addition, the table shows the percentages of the total distribution amount per share attributable
to (i) net investment income, (ii) net realized short-term capital gain, (iii) net realized long-term capital gain and (iv) return of
capital or other capital source. These percentages are disclosed for the current distribution as well as the fiscal year-to-date cumulative
distribution amount per share for the Fund.
| Current
Distribution from: |
|
|
| |
Per
Share ($) |
Percentage
(%) |
| Net
Investment Income |
0.00147 |
1.07% |
| Net
Realized Short-Term Capital Gains |
0.00537 |
3.91% |
| Net
Realized Long-Term Capital Gains |
0.04260 |
30.98% |
| Return
of Capital or other Capital Source |
0.08806 |
64.04% |
| Total
(per common share) |
0.13750 |
100.00% |
| |
|
|
| Fiscal
Year-to-Date Cumulative |
|
|
| Distributions
from1: |
|
|
| |
Per
Share ($) |
Percentage
(%) |
| Net
Investment Income |
0.00147 |
1.07% |
| Net
Realized Short-Term Capital Gains |
0.00537 |
3.91% |
| Net
Realized Long-Term Capital Gains |
0.04260 |
30.98% |
| Return
of Capital or other Capital Source |
0.08806 |
64.04% |
| Total
(per common share) |
0.13750 |
100.00% |
Stockholders
should not draw any conclusions about the Fund’s investment performance from the amount of this distribution or from the terms
of the Fund’s managed distribution policy. The amounts and sources of distributions reported in this 19(a) Notice are only estimates,
are likely to change over time, and are not being provided for tax reporting purposes.
The
Fund estimates that it has distributed more than its income and net realized capital gains; therefore, a portion of your distribution
may be a return of capital. A return of capital may occur for example, when some or all of the money that you invested in the Fund is
paid back to you. A return of capital distribution does not necessarily reflect the Fund's investment performance and should not be confused
with ‘yield’ or ‘income’.
The
actual amounts and sources of the amounts for accounting and tax reporting purposes will depend upon the Fund’s investment experience
during the remainder of its fiscal year and may be subject to changes based on tax regulations. The amounts and sources of distributions
year-to-date may be subject to additional adjustments.
1
The Fund’s fiscal year is December 1 to November 30. Information shown is for the period beginning December 1, 2023.
THE
FUND WILL SEND YOU A FORM 1099-DIV FOR THE CALENDAR YEAR THAT WILL TELL YOU HOW TO REPORT THESE DISTRIBUTIONS FOR FEDERAL INCOME TAX
PURPOSES.
Presented
below are return figures, based on the change in the Fund’s Net Asset Value per share (“NAV”), compared to the annualized
distribution rate for this current distribution as a percentage of the NAV on the last day of the month prior to the distribution declaration
date. While the NAV performance may be indicative of the Fund’s investment performance, it does not measure the value of a stockholder’s
investment in the Fund. The value of a stockholder’s investment in the Fund is determined by the Fund’s market price, which
is based on the supply and demand for the Fund’s shares in the open market.
Fund
Performance & Distribution Rate Information
| Annualized
Distribution Rate as a Percentage of NAV^ |
3.16% |
| Cumulative
Distribution Rate as a Percentage of NAV* |
0.79% |
| Cumulative
Total Return as a Percentage of NAV** |
3.33% |
| Average
Annual Total Return*** |
10.86% |
^
Based on the Fund’s NAV as of December 31, 2023 and the quarterly distribution of $0.1375.
*Based
on the Fund’s NAV as of December 31, 2023 and includes distributions through January 31, 2024.
**Cumulative
Total Return is the percentage change in the Fund’s NAV including distributions paid and assuming reinvestment of these distributions
for the period December 1, 2023 through December 31, 2023.
***Average
Annual Total Return represents the compound average of the Annual NAV Total Returns of the Fund for the five-year period ending December
31, 2023. Annual NAV Total Return is the percentage change in the Fund’s NAV over a year including distributions paid and assuming
reinvestment of these distributions.
The
Fund has a managed distribution policy that seeks to deliver the Fund’s long term total return potential through regular quarterly
distributions declared at a fixed rate per share. Distributions may be paid in part or in full from net investment income, realized capital
gains and by returning capital, or a combination thereof. Stockholders should note, however, that if the Fund’s aggregate net investment
income and net realized capital gains are less than the amount of the distribution level, the difference will be distributed from the
Fund’s assets and will constitute a return of the stockholder’s capital. A return of capital is not taxable; rather it reduces
a stockholder’s tax basis in his or her shares of the Fund.
The
Fund’s Board of Directors reviews the amount of any distributions made pursuant to the Fund’s distribution policy and considers
the income earned and capital gains realized by the Fund, as well as the Fund’s available capital. The Board of Directors will
continue to monitor the Fund’s distribution level, taking into consideration, among other things, the Fund’s net asset value
and market conditions. The Fund’s distribution policy is subject to modification, suspension or termination by the Board of Directors
at any time, which could have an adverse effect on the market price of the Fund’s shares. The distribution rate should not be considered
the dividend yield or total return on an investment in the Fund.
For
more information on the Fund, please visit us on the web at www.srhtotalreturnfund.com.
NOT
FDIC INSURED | May Lose Value | No Bank Guarantee
Contact
info:
Website: https://srhtotalreturnfund.com/
Email: stewclientinquiries@paralel.com
Notification
of Sources of Distribution
Statement
Pursuant to Section 19(a) of the Investment Company Act of 1940
Denver,
CO/ACCESSWIRE/April 30, 2024/ On April 30, 2024, SRH Total Return Fund, Inc. (NYSE: STEW) (the “Fund”), a closed-end investment
company, will pay a distribution on its common stock of $0.1375 per share to stockholders of record at the close of business on April
23, 2024. The Fund, acting in accordance with an exemptive order received from the Securities and Exchange Commission and with approval
of its Board of Directors, adopted a managed distribution policy under which the Fund may utilize capital gains, where applicable, as
part of regular quarterly cash distributions to its stockholders. This policy gives the Fund greater flexibility to realize capital gains
and to distribute those gains to stockholders.
The
following table sets forth the estimated amounts of the current distribution and the cumulative distributions paid this fiscal year-to-date
from the sources indicated in the table. In addition, the table shows the percentages of the total distribution amount per share attributable
to (i) net investment income, (ii) net realized short-term capital gain, (iii) net realized long-term capital gain and (iv) return of
capital or other capital source. These percentages are disclosed for the current distribution as well as the fiscal year-to-date cumulative
distribution amount per share for the Fund.
| Current
Distribution from: |
|
|
| |
Per
Share ($) |
Percentage
(%) |
| Net
Investment Income |
0.03693 |
26.86% |
| Net
Realized Short-Term Capital Gains |
0.00000 |
0.00% |
| Net
Realized Long-Term Capital Gains |
0.10057 |
73.14% |
| Return
of Capital or other Capital Source |
0.00000 |
0.00% |
| Total
(per common share) |
0.13750 |
100.00% |
| |
|
|
| Fiscal
Year-to-Date Cumulative |
|
|
| Distributions
from1: |
|
|
| |
Per
Share ($) |
Percentage
(%) |
| Net
Investment Income |
0.03840 |
13.97% |
| Net
Realized Short-Term Capital Gains |
0.00537 |
1.95% |
| Net
Realized Long-Term Capital Gains |
0.14317 |
52.06% |
| Return
of Capital or other Capital Source |
0.08806 |
32.02% |
| Total
(per common share) |
0.27500 |
100.00% |
Stockholders
should not draw any conclusions about the Fund’s investment performance from the amount of this distribution or from the terms
of the Fund’s managed distribution policy. The amounts and sources of distributions reported in this 19(a) Notice are only estimates,
are likely to change over time, and are not being provided for tax reporting purposes.
The
Fund estimates that it has distributed more than its income and net realized capital gains; therefore, a portion of your distribution
may be a return of capital. A return of capital may occur for example, when some or all of the money that you invested in the Fund is
paid back to you. A return of capital distribution does not necessarily reflect the Fund's investment performance and should not be confused
with ‘yield’ or ‘income’.
The
actual amounts and sources of the amounts for accounting and tax reporting purposes will depend upon the Fund’s investment experience
during the remainder of its fiscal year and may be subject to changes based on tax regulations. The amounts and sources of distributions
year-to-date may be subject to additional adjustments.
1
The Fund’s fiscal year is December 1 to November 30. Information shown is for the period beginning December 1, 2023.
THE
FUND WILL SEND YOU A FORM 1099-DIV FOR THE CALENDAR YEAR THAT WILL TELL YOU HOW TO REPORT THESE DISTRIBUTIONS FOR FEDERAL INCOME TAX
PURPOSES.
Presented
below are return figures, based on the change in the Fund’s Net Asset Value per share (“NAV”), compared to the annualized
distribution rate for this current distribution as a percentage of the NAV on the last day of the month prior to the distribution declaration
date. While the NAV performance may be indicative of the Fund’s investment performance, it does not measure the value of a stockholder’s
investment in the Fund. The value of a stockholder’s investment in the Fund is determined by the Fund’s market price, which
is based on the supply and demand for the Fund’s shares in the open market.
Fund
Performance & Distribution Rate Information
| Annualized
Distribution Rate as a Percentage of NAV^ |
2.82% |
| Cumulative
Distribution Rate as a Percentage of NAV* |
1.41% |
| Cumulative
Total Return as a Percentage of NAV** |
17.11% |
| Average
Annual Total Return*** |
12.58% |
^
Based on the Fund’s NAV as of March 31, 2024 and the quarterly distribution of $0.1375.
*Based
on the Fund’s NAV as of March 31, 2024 and includes distributions through April 30, 2024.
**Cumulative
Total Return is the percentage change in the Fund’s NAV including distributions paid and assuming reinvestment of these distributions
for the period December 1, 2023 through March 31, 2024.
***Average
Annual Total Return represents the compound average of the Annual NAV Total Returns of the Fund for the five-year period ending March
31, 2024. Annual NAV Total Return is the percentage change in the Fund’s NAV over a year including distributions paid and assuming
reinvestment of these distributions.
The
Fund has a managed distribution policy that seeks to deliver the Fund’s long term total return potential through regular quarterly
distributions declared at a fixed rate per share. Distributions may be paid in part or in full from net investment income, realized capital
gains and by returning capital, or a combination thereof. Stockholders should note, however, that if the Fund’s aggregate net investment
income and net realized capital gains are less than the amount of the distribution level, the difference will be distributed from the
Fund’s assets and will constitute a return of the stockholder’s capital. A return of capital is not taxable; rather it reduces
a stockholder’s tax basis in his or her shares of the Fund.
The
Fund’s Board of Directors reviews the amount of any distributions made pursuant to the Fund’s distribution policy and considers
the income earned and capital gains realized by the Fund, as well as the Fund’s available capital. The Board of Directors will
continue to monitor the Fund’s distribution level, taking into consideration, among other things, the Fund’s net asset value
and market conditions. The Fund’s distribution policy is subject to modification, suspension or termination by the Board of Directors
at any time, which could have an adverse effect on the market price of the Fund’s shares. The distribution rate should not be considered
the dividend yield or total return on an investment in the Fund.
For
more information on the Fund, please visit us on the web at www.srhtotalreturnfund.com.
NOT
FDIC INSURED | May Lose Value | No Bank Guarantee
Contact
info:
Website: https://srhtotalreturnfund.com/
Email: stewclientinquiries@paralel.com
SRH Total Return (NYSE:STEW)
過去 株価チャート
から 10 2024 まで 11 2024
SRH Total Return (NYSE:STEW)
過去 株価チャート
から 11 2023 まで 11 2024
