Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Question
Explain the concept of American depositary receipts (ADRs).
Expert Solution
Step 1
Answer:
Meaning of American depositary receipts (ADRs):
American negotiable securities that signify ownership of shares of a foreign company traded in the US capital market. It is distributed to U.S investor by an American bank in denominations of US dollars. It is essentially encouraging domestic buyers to purchase international business securities.
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