Investments
What is ADR? (American Depository Receipts)
ADR stands for American Depository Receipts. It is a kind of negotiable certificate that provides authority to U.S. investors. This certificate has granted the right to U.S. investors to invest in companies that have been tagged as non-U.S. companies.
What is GDR? (Global Depository Receipt)
A negotiable financial instrument provided by a foreign bank that demonstrates shares of an foreign company listed on any of the stock exchanges other than the United States. When you invest as a domestic investor in any company that belongs outside of their home country, you as a GDR holder get dividends in foreign currency (Euro or GBP).
What is the difference between ADRs & GDRs?
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ADRS
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GDRs
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ADR stands for American Depository Receipts. It is a kind of negotiable certificate that provides authority to U.S. investors. This certificate has granted the right to U.S. investors to invest in companies that have been tagged as non-U.S. companies.
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GDR stands for Global Depository Receipt. It is a depository receipt provided by a foreign bank that demonstrates shares of an foreign company listed on any of the stock exchanges other than the United States.
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The US Stock market is a place where foreign companies can trade in multiple bank branches using the certificate of ADR.
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On the other hand, GDR allows foreign firms to trade in any stock market of distinctive countries other than the US market.
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It is issued only in America
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It can be trade all over the world
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In this, market is more liquid
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Not as much liquid as compared to ADRs
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High Investor’s participation
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Low Investor’s participation
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ADR market is for retail investor marketers
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GDR market is for institutional
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ADRs agreements are more burdensome
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GDRs agreements are easy to manage.
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