Noting that Gabelli Asset Management is just one of a growing legion of mutual fund companies that have been subpoenaed by the New York attorney general’s office, as well as actions the firm has taken to prevent market timing, Merrill Lynch issued a favorable report on the firm Friday.

Citing a notice that Gabelli had posted on its Web site, Merrill analyst Cyntha Mayer maintained a "buy" on the firm. Gabelli has tried to prevent market timing for more than five years, according to the notice. It has monitored trading frequency and cash flows, particularly trades of $100,000 or more. In addition, it has employed fair value pricing in its gold, global and international funds to prevent time-zone arbitrage.

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