Chinese Depositary Receipt - CDR

DEFINITION of 'Chinese Depositary Receipt - CDR'

A type of depositary receipt that is traded on Chinese stock exchanges. A CDR is a certificate issued by a Chinese bank that represents a pool of foreign equity that is traded on local Chinese exchanges. Foreign companies can use CDRs to allow both Chinese institutional and private investors to own their stock.

BREAKING DOWN 'Chinese Depositary Receipt - CDR'

In other words, a depositary receipt (DR) is a certificate issued by a bank representing equity in foreign companies, which is traded on stock exchanges within the issuing country.

CDRs are a recent addition to the expansion of depositary receipts that started in the 1920s. Other forms of depositary receipts are global, European, and international. The most common type is the American depositary receipt.