ADR stands for American Depository receipt. It is issued by the United States depository bank and is a negotiable certificate which represents a certain number of shares. This is often just one share of company stock in a foreign company. Currently, the ADR is traded like any domestic shares on United States stock markets.
Are There Fees Associated with ADR
The depository banks do charge “custody fees” which are sometimes called “Depository Service Fees.” These fees compensate the depository banks for their inventory of non-US shares. Also, the compliance, dividend, and recordkeeping are covered by these fees.
Further Reading
- The anatomy of financial crises: Evidence from the emerging ADR market – www.sciencedirect.com [PDF]
- The contagious effects of the Asian financial crisis: some evidence from ADR and country funds – www.sciencedirect.com [PDF]
- Investor protection and the liquidity of cross-listed securities: Evidence from the ADR market – www.sciencedirect.com [PDF]
- Are Financial Crises Indeed'Crises?'Evidence from the Emerging ADR Market – papers.ssrn.com [PDF]
- Determinants of dividend policies for ADR firms – www.emerald.com [PDF]
- Stock splits: Signaling or liquidity? The case of ADR 'solo-splits' – www.sciencedirect.com [PDF]
- Price determinants of American Depositary Receipts (ADR): a cross-sectional analysis of panel data – www.tandfonline.com [PDF]
- US ADR and Hong Kong H-share discounts of Shanghai-listed firms – www.sciencedirect.com [PDF]
- Effects of exchange-rate and interest-rate risk on ADR pricing behavior – www.sciencedirect.com [PDF]
- Do ADR investors herd?: Evidence from advanced and emerging markets – www.sciencedirect.com [PDF]
