Cross-Listing

AAA

DEFINITION of 'Cross-Listing'

The listing of a company's common shares on a different exchange than its primary and original stock exchange. In order to be approved for cross-listing, the company in question must meet the same requirements as any other listed member of the exchange, such as basic requirements for the share count, accounting policies, filing requirements for financial reports and company revenues.

INVESTOPEDIA EXPLAINS 'Cross-Listing'

Some of the advantages to cross-listing include having shares trade in multiple time zones and in multiple currencies. This gives issuing companies more liquidity and a greater ability to raise capital. Most foreign companies that cross-list in the U.S. markets do so via American depositary receipts (ADRs).

The term often applies to foreign-based companies that choose to list their shares on U.S.-based exchanges like the New York Stock Exchange (NYSE). But firms based in the U.S. may choose to cross-list on European or Asian exchanges, a strategy that may become more popular if the U.S. dollar struggles against major foreign currencies for a lengthy period of time.
The adoption of Sarbanes-Oxley (SOX) requirements in 2002 made cross-listing on U.S. exchanges more costly than in the past; the requirements put a heavy emphasis on corporate governance and accountability. This, along with generally accepted accounting principles (GAAP) accounting, makes for a challenging hurdle for many companies whose "home" exchange may have laxer standards.

RELATED TERMS
  1. Euro

    The official currency of the European Union's (EU) member states. ...
  2. American Depositary Receipt - ADR

    A negotiable certificate issued by a U.S. bank representing a ...
  3. New York Stock Exchange - NYSE

    A stock exchange based in New York City, which is considered ...
  4. Sarbanes-Oxley Act Of 2002 - SOX

    An act passed by U.S. Congress in 2002 to protect investors from ...
  5. Floating Exchange Rate

    A country's exchange rate regime where its currency is set by ...
  6. Internal Controls

    Methods put in place by a company to ensure the integrity of ...
Related Articles
  1. An Introduction To Depositary Receipts
    Bonds & Fixed Income

    An Introduction To Depositary Receipts

  2. What are the listing requirements for ...
    Investing

    What are the listing requirements for ...

  3. Can stocks be traded on more than one ...
    Investing

    Can stocks be traded on more than one ...

  4. What is the difference between IAS and ...
    Investing

    What is the difference between IAS and ...

comments powered by Disqus
Hot Definitions
  1. Days Sales Of Inventory - DSI

    A financial measure of a company's performance that gives investors an idea of how long it takes a company to turn its inventory ...
  2. Accounts Payable - AP

    An accounting entry that represents an entity's obligation to pay off a short-term debt to its creditors. The accounts payable ...
  3. Ratio Analysis

    Quantitative analysis of information contained in a company’s financial statements. Ratio analysis is based on line items ...
  4. Days Payable Outstanding - DPO

    A company's average payable period. Calculated as: ending accounts payable / (cost of sales/number of days).
  5. Net Sales

    The amount of sales generated by a company after the deduction of returns, allowances for damaged or missing goods and any ...
  6. Over The Counter

    A security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, etc. The phrase "over-the-counter" ...
Trading Center