American Depositary Receipt Basics
AAA
  1. ADR Basics: Introduction
  2. ADR Basics: What Is An ADR?
  3. ADR Basics: Determining Price
  4. ADR Basics: Risks
  5. ADR Basics: Conclusion

ADR Basics: Introduction


Globalization is the dissolution of barriers to trade and the tendency of the world's businesses to integrate customs and values. Globalization is making it increasingly easy to travel, correspond and even invest in other countries.

Investing money in your own country's stock market is relatively simple. You call your broker or login to your online account and place a buy or sell order. Investing in a company that is listed on a foreign exchange is much more difficult. Would you even know where to start? Does your broker provide services in other countries? For example, imagine the commission and foreign exchange costs on an investment in Russia or Indonesia.

However, now there is an easy way around this through American depositary receipts (ADRs). More than 2,000 foreign companies provide this option for U.S. and Canadian investors interested in buying shares. In this tutorial, we'll explain how this investment vehicle works and help you sort out whether it could be a good choice for your portfolio.

ADR Basics: What Is An ADR?

  1. ADR Basics: Introduction
  2. ADR Basics: What Is An ADR?
  3. ADR Basics: Determining Price
  4. ADR Basics: Risks
  5. ADR Basics: Conclusion
RELATED TERMS
  1. Welfare Capitalism

    Definition of welfare capitalism.
  2. Foreign remittance

  3. Bid Wanted

    An announcement by an investor who holds a security that he or ...
  4. Heckscher-Ohlin Model

    An economic theory that states that countries export what they ...
  5. Sponsored ADR

    An American depositary receipt (ADR) issued by a bank on behalf ...
  6. Depositary Receipt

    A negotiable financial instrument issued by a bank to represent ...
  1. What does it mean when a country has little activity in its capital account?

    Know what a country's capital account represents and understand what the implications are if a country has little activity ...
  2. What is the difference between a bill of exchange and a promissory note?

    Learn what bills of exchange and promissory notes are, along with notation of the primary differences between these two documents.
  3. What does 'Incoterms' mean in relation to Ex Works (EXW) trades?

    Learn about Incoterms rules and ex works trade agreements and the obligations of buyers and sellers under the Incoterms rules ...
  4. What are the differences between Ex Works (EXW) and Free On Board (FOB)?

    Learn about Ex Works and Free on Board, the main difference between these Incoterms, and the responsibilities of buyers and ...

You May Also Like

Related Tutorials
  1. Bonds & Fixed Income

    Investing For Safety and Income Tutorial

  2. Investing Basics

    Stock Basics Tutorial

  3. Options & Futures

    Beginner's Guide To Trading Futures

  4. Trading Strategies

    Introduction To Order Types

  5. Options & Futures

    Options Pricing

Trading Center