Holding Company Depository Receipt - HOLDR


DEFINITION of 'Holding Company Depository Receipt - HOLDR'

A financial product created by Merrill Lynch and traded daily on the American Stock Exchange that allows investors to buy and sell a basket of stocks in a particular sector, industry or other classification in a single transaction.

BREAKING DOWN 'Holding Company Depository Receipt - HOLDR'

There is a wide range of HOLDRs, covering various segments of the market such as biotech, internet and Europe 2001. Each HOLDR represents individual ownership in the stocks underlying the HOLDR. The value of the HOLDR fluctuates with the change in value of the underlying stocks.

The benefit of this instrument is that it enables an investor to gain exposure to a segment of the market and diversify within that sector. To gain the same level of diversification without this vehicle, the investor would need to purchase each company individually, thus increasing the amount of commissions.

  1. Exchange-Traded Fund (ETF)

    A security that tracks an index, a commodity or a basket of assets ...
  2. Depositary Receipt

    A negotiable financial instrument issued by a bank to represent ...
  3. American Depositary Share - ADS

    A U.S. dollar-denominated equity share of a foreign-based company ...
  4. American Depositary Receipt - ADR

    A negotiable certificate issued by a U.S. bank representing a ...
  5. American Stock Exchange - AMEX

    The third-largest stock exchange by trading volume in the United ...
  6. Sector

    1. An area of the economy in which businesses share the same ...
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. 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. Mutual Funds & ETFs

    Mutual Fund Or ETF: Which Is Right For You?

    Learn the differences between these investment products and how to take full advantage.
  4. Stock Analysis

    Berkshire Hathaway's 4 Most Profitable Lines of Business

    Learn about Warren Buffett and his company Berkshire Hathaway. Understand why the four companies listed are his most important and profitable lines of business.
  5. Insurance

    Warren Buffett: The Road To Riches

    Find out how he went from selling soft drinks to buying up companies and making billions of dollars.
  6. Investing Basics

    What's a Holding Company?

    A holding company is a corporation that owns enough voting stock in another company to control its management and policies.
  7. Economics

    How & Why Companies Become Monopolies

    Without competition, monopolies can raise prices and lower quality leaving consumers little choice. But monopolies can benefit consumers as well.
  8. Trading Strategies

    Risk Management Techniques For Shorting Call Options

    Shorting covered calls is a popular options trade strategy. Here are the methods to mitigate the risk/loss and enhance profits for selling covered calls
  9. Fundamental Analysis

    Stock Quotes Explained

    Curious about how stock quotes are compiled and what a trader should know about how? Read on.
  10. Active Trading Fundamentals

    10 Timeless Rules For Investors

    Find out what most investors are doing wrong, and how you can do it right.
  1. What is Warren Buffett's largest holding?

    The investing strategies of Warren Buffet, the billionaire investor dubbed the Oracle of Omaha, have long been the focus ... Read Full Answer >>
  2. What are the differences between AMEX and Nasdaq?

    While similar in purpose, the American Stock Exchange (AMEX) and the National Association of Securities Dealers Automated ... Read Full Answer >>
  3. What are all of the securities markets in the U.S.A?

    There are three major U.S. financial securities markets which are: New York Stock Exchange (NYSE): NYSE is a stock exchange ... Read Full Answer >>
  4. Why did the Department of Justice launch an inquiry into the sale of ImClone shares ...

    On December 28, 2001, the FDA announced that it was rejecting ImClone's new cancer drug, Erbitux. The drug represented a ... Read Full Answer >>
  5. How can I find out which stocks also trade as options?

    The trading of options has become increasingly popular among retail investors as they become aware of the many different ... Read Full Answer >>
  6. Can investors short sell pink sheet or over-the-counter stocks?

    Short selling is an effective trading strategy that can be employed to hedge the risk of a loss on an off-setting position ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Turkey

    Slang for an investment that yields disappointing results or turns out worse than expected. Failed business deals, securities ...
  2. Barefoot Pilgrim

    A slang term for an unsophisticated investor who loses all of his or her wealth by trading equities in the stock market. ...
  3. Quick Ratio

    The quick ratio is an indicator of a company’s short-term liquidity. The quick ratio measures a company’s ability to meet ...
  4. Black Tuesday

    October 29, 1929, when the DJIA fell 12% - one of the largest one-day drops in stock market history. More than 16 million ...
  5. Black Monday

    October 19, 1987, when the Dow Jones Industrial Average (DJIA) lost almost 22% in a single day. That event marked the beginning ...
  6. Monetary Policy

    Monetary policy is the actions of a central bank, currency board or other regulatory committee that determine the size and ...
Trading Center