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connected to the international stock exchange for selling the depositary receipts. This connection ensures that the shares of stock actually exist and no manipulation occurs between the foreign company and the international brokerage house.
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A depositary receipt typically requires a company to meet a stock exchange’s specific rules before listing its stock for sale. For example, a company must transfer shares to a
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The ADR is priced in dollars, and the dividends are paid out in dollars as well, making it as simple for an
American investor to buy as the stock of a U.S.-based company.
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where a foreign share is accessible in a different market through an exchange convention and not actually registered within that different market.
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The issuing bank in the U.S. studies the financials of the foreign company in detail to assess the strength of its stock.
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DRs should not be confused with other methods that allow a company's stock to be traded in multiple exchanges, such as:
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Depositary receipts that are listed and traded in the United States are
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A typical ADR goes through the following steps before it is issued:
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Each packet is issued as an ADR through an
American stock exchange.
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function similarly, but not identically to depositary receipts.
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house in its home country. Upon receipt, the brokerage uses a
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281:. Investopedia (2009-02-15). Retrieved on 2013-07-14.
57:. Unsourced material may be challenged and removed.
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186:The bank buys shares of the foreign company.
291:How ADR Work | American Depository Receipts
140:. The depositary receipt trades on a local
117:Learn how and when to remove this message
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307:An introduction to Depositary Receipts
293:. Pfhub.com. Retrieved on 2013-07-14.
200:Other forms of multi-exchange trading
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189:The shares are grouped into packets.
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155:(EDRs), and other banks issue
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279:Depositary Receipt Definition
151:(ADRs). European banks issue
153:European depositary receipts
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234:American depositary receipt
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256:CREST Depositary Interests
157:global depository receipts
249:Indian Depository Receipt
244:Global Depositary Receipt
221:Admitted for trading,
215:Dual listed companies
66:"Depositary receipt"
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327:Depositary receipts
309:. By Reem Heakal.
131:depositary receipt
18:Depository receipt
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228:Types of DR
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159:(GDRs).
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