American depositary receipts
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The stocks of most foreign companies that trade in the U.S. markets are traded as American Depositary Receipts (ADRs). U.S. depositary banks issue these stocks. Each ADR represents one or more shares of foreign stock or a fraction of a share. Those who own ADRs have the right to obtain the foreign stock those ADRs represent, but U.S. investors usually find it more convenient to own the ADR. The price of an ADR corresponds to the price of the foreign stock in its home market, adjusted to the ratio of the ADRs to foreign company shares.[1]
References
- ↑ American Depositary Receipts "American Depositary Receipts ”. www.sec.gov. Retrieved on Nov. 14, 2007.
