European Depository Receipt - EDR

DEFINITION of 'European Depository Receipt - EDR'

A negotiable security (receipt) that is issued by a European bank, and that represents securities which trade on exchanges outside of the bank's home country. Abbreviated as "EDRs", these securities are traded on local exchanges and used by banks - and issuing companies in the U.S. and other countries - to attract investment capital from the European region.

Also known as "Euro Depository Receipts", which may or may not imply that the euro is the currency the receipt is issued upon.

BREAKING DOWN 'European Depository Receipt - EDR'

While the euro isn't the only currency that can be used to issue and trade European Depository Receipts, it is the most common because of its widespread adoption in Europe. American Depository Receipts (ADRs) are the equivalent of this type of bank receipt in the U.S.

Investors in EDRs are entitled to the same dividends and capital gains as the investors who hold common shares in the same company.

RELATED TERMS
  1. Safekeeping Certificate

    A document that represents ownership of a security or certificate ...
  2. Euro

    The official currency of the European Union's (EU) member states. ...
  3. Unpaid Dividend

    A dividend that is owed to stockholders of record but has yet ...
  4. American Depositary Receipt - ADR

    A negotiable certificate issued by a U.S. bank representing a ...
  5. European Central Bank - ECB

    The central bank responsible for the monetary system of the European ...
  6. London Stock Exchange - LSE

    The primary stock exchange in the U.K. and the largest in Europe. ...
Related Articles
  1. Insurance

    Investing Beyond Your Borders

    Investing abroad poses risks, but can also help you diversify. Discover ways to invest in foreign stocks.
  2. 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.
  3. Forex Education

    How International Tax Rates Impact Your Investments

    International investors need to be aware of the staggering correlation between tax rates and economic performance.
  4. Investing

    3 Things About International Investing and Currency

    As world monetary policy continues to diverge rocking bottom on interest rates while the Fed raises them, expect currencies to continue their bumpy ride.
  5. Fundamental Analysis

    How Globalization Affects Developed Countries

    The increase in communications technology has companies competing in a global market.
  6. Investing

    Which Countries Will Drive Global Growth in 2016?

    Given the volatility that has already shaken the global economy, the world's largest economies will be leaned on to stimulate growth in 2016
  7. Stock Analysis

    The Top 5 Small-Cap Alternative Energy Stocks for 2016 (CSIQ, TSL)

    Learn about the top five small-cap alternative energy stocks for 2016 with analysis of their different business fundamentals and financial maneuvers.
  8. Mutual Funds & ETFs

    The 4 Best International Equity Index Mutual Funds

    Discover the top four mutual funds that invest in international equities by using a passive investment approach and following foreign stock indexes.
  9. Stock Analysis

    Investing in U.S. Stocks Vs. International Stocks in 2016

    Examine the case for investing in more international stocks versus U.S.-based stocks as the markets enter the 2016 trading year.
  10. Mutual Funds & ETFs

    Top 3 ETFS for Investing in Germany

    Discover why Germany is considered an economic powerhouse in the eurozone, and learn about the three ETFs that provide investors exposure to Germany’s economy.
RELATED FAQS
  1. Does a company's American depositary share equal one share of common stock?

    American depositary shares (ADS) come into play when a foreign company wants its shares to trade on a major American exchange. ... Read Full Answer >>
  2. Do mutual funds have CUSIP numbers?

    The Committee on Uniform Securities Identification Procedures (CUSIP) number is a standardized identification system used ... Read Full Answer >>
  3. How are American Depository Receipts (ADRs) priced?

    The price of an American depositary receipt (ADR) is determined by the bank or other financial institution that issues it. ... Read Full Answer >>
  4. How are American Depository Receipts (ADRs) exchanged?

    American depositary receipts (ADRs) are bought and sold on regular U.S. stock exchanges, either in the over-the-counter market ... Read Full Answer >>
  5. What are the differences between global depositary receipts (GDRs) and American depositary ...

    A global depositary receipt (GDR) is a bank certificate issued in multiple countries for shares in a foreign company. The ... Read Full Answer >>
  6. What is the difference between a greenfield investment and a regular investment?

    A greenfield investment is a particular type of investment where an international company begins a new operation in a foreign ... Read Full Answer >>
Hot Definitions
  1. Inverted Yield Curve

    An interest rate environment in which long-term debt instruments have a lower yield than short-term debt instruments of the ...
  2. Socially Responsible Investment - SRI

    An investment that is considered socially responsible because of the nature of the business the company conducts. Common ...
  3. Presidential Election Cycle (Theory)

    A theory developed by Yale Hirsch that states that U.S. stock markets are weakest in the year following the election of a ...
  4. Super Bowl Indicator

    An indicator based on the belief that a Super Bowl win for a team from the old AFL (AFC division) foretells a decline in ...
  5. Flight To Quality

    The action of investors moving their capital away from riskier investments to the safest possible investment vehicles. This ...
Trading Center