About American Depository Receipt
An American Depository Receipt, or ADR, is a negotiable certificate which is issued by a US bank. It represents a specific number of shares or just one share on a foreign stock on the American exchange.
Because the underlying security of the certificate is held by a US financial institution, duty and admin costs are much lower than they would be without the ADR.
Banks in the United States tend to purchase large quantities of foreign shares. Then they repackage those shares and place them into a price range that generally falls between $10-$100. American Depository Receipts have been in the financial markets since 1927.
Despite being around for nearly a century, finding unbiased news and information about ADRs can be difficult. This is especially true if you are looking at this trading and/or investment opportunity. For the first time.
At American Depository Receipt, we are changing that lack of access one post at a time.
What You Can Expect From American Depository Receipt
We take you into the world of the negotiable ADR. Using white board video presentations and informative content that isn’t filled with industry jargon, our goal is simple: to answer your questions about this exciting opportunity. That way you can see how the process of buying foreign stock, but receiving dividend payments in US dollars, can benefit your portfolio today.
As the authority on understanding the ADR investment, you will be able to find the answers you’ve been seeking right here. Each post is designed to take you from start to finish through the topic being addressed, shedding new light onto this unique financial opportunity.
Why Choose an ADR For Your Portfolio?
Diversification is the best way to insure your financial future against the daily ups and downs of the marketplace. An ADR might have a higher growth rate because it is in an emerging market, which gives the investor a chance to earn a better return on their investment when compared to standard stocks, bonds, or money market accounts.
American investors can also benefit when they are purchasing an ADR which pays out dividends in currency units which are trading above the US dollar on the global market. The two most common currencies to do this are the Euro and the British Pound. The dividends are automatically converted into dollars, which makes the potential return that much more rewarding.
This doesn’t mean that investors will hit a home run with every ADR opportunity. As with any investment or trading opportunity, there are risks which must be managed.
This is where American Depository Receipt can help you to make more informed decisions about each opportunity. We’ll show you the advantages, the disadvantages, and the risks that come with this opportunity so that you can begin to see the bigger picture of each opportunity you encounter.
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