Custodial Receipt

AAA

DEFINITION of 'Custodial Receipt'

A receipt representing a security held by a custodian or transfer agent. As such, it represents ownership of the security by the depositor. A security in custodial receipt form is usually non-transferable.

INVESTOPEDIA EXPLAINS 'Custodial Receipt'

In the municipal bond market, custodial receipts refer to securities that represent the right to receive future principal and interest payments on municipal obligations underlying these receipts. In a typical custodial receipt arrangement in this market, an issuer or owner of a municipal obligation deposits it with a custodian in exchange for two or more classes of receipts.

RELATED TERMS
  1. Depositary Receipt

    A negotiable financial instrument issued by a bank to represent ...
  2. American Depositary Receipt - ADR

    A negotiable certificate issued by a U.S. bank representing a ...
  3. Trust Receipt

    Notice of the release merchandise to a buyer from a bank, with ...
  4. Custodial Account

    1. An account created at a bank, brokerage firm or mutual fund ...
  5. Municipal Bond

    A debt security issued by a state, municipality or county to ...
  6. Custodian

    A financial institution that holds customers' securities for ...
RELATED FAQS
  1. Why are big foreign companies considering delisting their American depositary receipts?

    American depositary receipts (ADRs) were developed to give investors an easier way to invest in foreign companies. An ADR ... Read Full Answer >>
  2. What are the main benchmarks that track the performance of the Internet sector?

    The main benchmarks that track the performance of the Internet sector are the Nasdaq Composite Index, the First Trust Dow ... Read Full Answer >>
  3. How can I use asset allocation to properly diversify my portfolio?

    Asset allocation is the process of dividing a portfolio among a number of different asset classes. Most commonly, asset allocation ... Read Full Answer >>
  4. What are some of the limitations and drawbacks of using a payback period for analysis?

    Limitations, or disadvantages, of using the payback period method in capital budgeting include the fact that it fails to ... Read Full Answer >>
  5. What level of annual growth is common for companies in the Internet sector?

    The Internet services sector consists of a diverse group of companies that exhibit strong growth potential. Investors often ... Read Full Answer >>
  6. What are the similarities and differences between the savings and loan (S&L) crisis ...

    The savings and loan crisis and the subprime mortgage crisis both began with banks creating new profit centers following ... Read Full Answer >>
Related Articles
  1. Economics

    American Depositary Receipt Basics

    Thanks to American depositary receipts, investors now have a world of investing opportunities to choose from.
  2. Investing Basics

    Introduction To American Depositary Receipts (ADRs)

    Investors should look beyond the confines of the U.S. borders to diversify and maximize returns. ADRs are one way to diversify your portfolio and help you achieve better returns when the U.S. ...
  3. Bonds & Fixed Income

    An Introduction To Depositary Receipts

    Learn about a security that allows you to invest in a foreign company through your local exchange.
  4. Insurance

    Why Is Health Care So Expensive In The Us?

    The U.S. is the world leader in only one area of health care: costs. Why is it so hard to rein in these expenses?
  5. Personal Finance

    cities with best healthcare system

    A starting guide to figuring out where the best care is when the diagnosis is a scary one.
  6. Insurance

    Do You Need Kidnap & Ransom Insurance?

    Americans working abroad – and high-profile individuals traveling frequently in kidnapping hot spots – should consider this type of protection.
  7. Stock Analysis

    Why Hasn't McDonald's Beaten The Dow Recently?

    McDonald's has underperformed the Dow Industrials since 2009, but a reorganization and buyback could turn things around.
  8. Stock Analysis

    Whole Foods Pricing: Mistake or Misdeed?

    Whole Foods Market might soon find itself in the middle of a public relations nightmare. But will its share price suffer?
  9. Personal Finance

    5 Signs You Need A Postnup

    They're not the most fun thing to contemplate, but these contracts can actually help a marriage.
  10. Insurance

    A Guide To Kidnap & Ransom Insurance

    Every year, thousands of people are kidnapped for ransom all over the world. This insurance offers protection – and peace of mind.

You May Also Like

Hot Definitions
  1. Bund

    A bond issued by Germany's federal government, or the German word for "bond." Bunds are the German equivalent of U.S. Treasury ...
  2. European Central Bank - ECB

    The central bank responsible for the monetary system of the European Union (EU) and the euro currency. The bank was formed ...
  3. Quantitative Easing

    An unconventional monetary policy in which a central bank purchases private sector financial assets in order to lower interest ...
  4. Current Account Deficit

    A measurement of a country’s trade in which the value of goods and services it imports exceeds the value of goods and services ...
  5. International Monetary Fund - IMF

    An international organization created for the purpose of: 1. Promoting global monetary and exchange stability. 2. Facilitating ...
  6. Risk-Return Tradeoff

    The principle that potential return rises with an increase in risk. Low levels of uncertainty (low-risk) are associated with ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!