American Depositary Receipt Basics
  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
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  3. SEC Form F-6

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  4. Russia ETF

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  5. Receipt

    A written acknowledgment that something of value has been transferred ...
  6. American Depositary Share - ADS

    A U.S. dollar-denominated equity share of a foreign-based company ...
RELATED FAQS
  1. Why would a company choose to use global depositary receipts (GDRs) for financing?

    Learn why a company might choose to utilize global depositary receipts for financing, along with the many other benefits ... Read Answer >>
  2. What are the differences between global depositary receipts (GDRs) and American depositary ...

    Discover some of the similarities and differences between global depositary receipts and American depositary receipts, and ... Read Answer >>
  3. What are the benefits of global depositary receipts (GDRs) to investors?

    Discover how the issuance and use of global depositary receipts can benefit investors in a variety of ways, including greater ... Read Answer >>
  4. Is there a difference between ADR and ADS?

    American depositary receipts (ADRs) allow foreign equities to be traded on U.S. stock exchanges; in fact, this is how the ... Read Answer >>
  5. 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 Answer >>
  6. 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 Answer >>

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