American Depositary Receipt

American Depositary Receipt - An American depositary receipt, also known as a ADR, is a negotiable certificate that is issued by one of the American banks that represents a certain number of shares available through foreign stock trading on an American Stock Exchange. By trading ADRs, it is much easier for American corporations, companies, and the public to invest their money in foreign companies. This is especially true with the widespread availability of dollar denominated, prices that are done in a particular currency, pricing information, timely dividend distribution and transactions, and lower transaction costs. An example of denominated pricing - a bond would be denominated in yen.