Global Depository Receipt
Encyclopedia
A global depository receipt or global depositary receipt (GDR) is a certificate issued by a depository bank
, which purchases share
s of foreign companies and deposits it on the account. GDRs represent ownership of an underlying number of shares.
Global depository receipts facilitate trade of shares, and are commonly used to invest in companies from developing or emerging markets
.
Prices of global depositary receipt are often close to values of related shares, but they are traded and settled independently of the underlying share.
Several international banks issue GDRs, such as JPMorgan Chase, Citigroup
, Deutsche Bank
, Bank of New York
. GDRs are often listed in the Frankfurt Stock Exchange
, Luxembourg Stock Exchange
and in the London Stock Exchange
, where they are traded on the International Order Book (IOB).
Normally 1 GDR = 10 Shares, but not always. It is negotiable instrument which is denominated in some freely convertible currency. it is a negotiable certificate denominated in us dollars which reparesents a NON-US Companys publicly traded local equity.
Depository bank
A depository bank is a bank organized in the United States which provides all the stock transfer and agency services in connection with a depository receipt program...
, which purchases share
Share (finance)
A joint stock company divides its capital into units of equal denomination. Each unit is called a share. These units are offered for sale to raise capital. This is termed as issuing shares. A person who buys share/shares of the company is called a shareholder, and by acquiring share or shares in...
s of foreign companies and deposits it on the account. GDRs represent ownership of an underlying number of shares.
Global depository receipts facilitate trade of shares, and are commonly used to invest in companies from developing or emerging markets
Emerging markets
Emerging markets are nations with social or business activity in the process of rapid growth and industrialization. Based on data from 2006, there are around 28 emerging markets in the world . The economies of China and India are considered to be the largest...
.
Prices of global depositary receipt are often close to values of related shares, but they are traded and settled independently of the underlying share.
Several international banks issue GDRs, such as JPMorgan Chase, Citigroup
Citigroup
Citigroup Inc. or Citi is an American multinational financial services corporation headquartered in Manhattan, New York City, New York, United States. Citigroup was formed from one of the world's largest mergers in history by combining the banking giant Citicorp and financial conglomerate...
, Deutsche Bank
Deutsche Bank
Deutsche Bank AG is a global financial service company with its headquarters in Frankfurt, Germany. It employs more than 100,000 people in over 70 countries, and has a large presence in Europe, the Americas, Asia Pacific and the emerging markets...
, Bank of New York
Bank of New York
The Bank of New York was a global financial services company established in 1784 by the American Founding Father Alexander Hamilton. It existed until its merger with the Mellon Financial Corporation on July 2, 2007...
. GDRs are often listed in the Frankfurt Stock Exchange
Frankfurt Stock Exchange
The Frankfurt Stock Exchange is the world's 12th largest stock exchange by market capitalization. Located in Frankfurt am Main, Germany, the Frankfurt Stock Exchange is owned and operated by Deutsche Börse, which also owns the European futures exchange Eurex and the clearing company...
, Luxembourg Stock Exchange
Luxembourg Stock Exchange
The Luxembourg Stock Exchange is a stock exchange based in Luxembourg City, in southern Luxembourg.The Exchange is located on avenue de la Porte-Neuve,...
and in the London Stock Exchange
London Stock Exchange
The London Stock Exchange is a stock exchange located in the City of London within the United Kingdom. , the Exchange had a market capitalisation of US$3.7495 trillion, making it the fourth-largest stock exchange in the world by this measurement...
, where they are traded on the International Order Book (IOB).
Normally 1 GDR = 10 Shares, but not always. It is negotiable instrument which is denominated in some freely convertible currency. it is a negotiable certificate denominated in us dollars which reparesents a NON-US Companys publicly traded local equity.
See also
- Deutsche Bank's depositary receipt website
- American Depositary ReceiptAmerican Depositary ReceiptAn American depositary receipt is a negotiable security that represents the underlying securities of a non-U.S. company that trades in the US financial markets...
- Global depository receipts
- http://adrbnymellon.com
- Frankfurt Stock Exchange