meaning of American Depositary Receipt

American Depositary Receipt meaning in Finance Dictionary

United states depositary receipts (ADRs) tend to be a convenient technique Us americans your can purchase shares in foreign companies. Instead of buying non-American stocks direct, they buy ADRs. ADRs are receipts for the shares of a foreign business. The share certificates by themselves take place by an American bank which issues the ADRs, then collects dividends and directs them to ADR-holders after changing them into bucks. The holders of ADRs as a rule have most of the rights of typical investors, including voting rights. The ADRs are tradable tools in their own right. Although meant for United states investors, ADRs can also be bought by non-Americans. Oftentimes it could be less expensive (when it comes to costs) for some body in London to get ADRs in a UK organization rather than purchase the shares from the London areas.