American Depositary Receipt (ADR)
📈 Investing
Quick Definition
An American Depositary Receipt (ADR) is a certificate issued by a U.S. bank representing a specified number of shares in a foreign stock traded on a U.S. exchange.
Examples
- 1A U.S. investor buys ADRs of Toyota, allowing them to invest in the Japanese company without dealing with cross-border trading complexities.
- 2An investor holds ADRs of Alibaba to gain exposure to the Chinese market while trading in U.S. dollars on the New York Stock Exchange.
- 3A mutual fund includes ADRs of Nestlé in its portfolio to diversify its investments internationally without direct trading on foreign exchanges.
Tags
ADRstocksinternational investingequityfinancial marketsglobal trading
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Quick Info
Category:Investing
Difficulty:intermediate
Last Updated:6/17/2025